No CrossRef data available.
Article contents
Trade Facilitation: An Assessment of South African Experiences vis-à-vis WTO Disciplines
Published online by Cambridge University Press: 28 October 2016
Abstract
Despite an array of trade reforms undertaken to integrate the country into the international community, South Africa's performance in international trade has remained dismal, primarily due to its customs procedures and documentation, coupled with resulting high transaction costs. The facilitation of trade and integration into the international community has therefore been a challenging issue for South Africa. Recently, the republic has embarked upon reforming its existing customs regimes, by enacting new legislation that will replace the prevailing Customs and Excise Act 91 of 1964. This article attempts to analyse how far these reforms will adhere to the World Trade Organization's disciplines on trade facilitation that call for harmonization and simplification of customs related rules. The author evaluates the provisions of this new legislation in order to assess whether South Africa is ready to undertake the obligations imposed by the Agreement on Trade Facilitation.
Keywords
- Type
- Research Article
- Information
- Copyright
- Copyright © SOAS, University of London 2016
References
1 F Flatters and M Stern “Trade and trade policy in South Africa: Recent trends and future prospects” (June 2007, Development Network Africa) at 3, available at: <http://www.dnaeconomics.com/assets/dlas/FILE_063020080109_FILE_101820070217_Trade_and_Trade_Policy_in_South_Africa.pdf> (last assessed 2 April 2015).
2 World Trade Organization “Trade profile: South Africa” (September 2014), available at: <http://stat.wto.org/CountryProfile/WSDBCountryPFView.aspx?Language=F&Country=ZA> (last accessed 4 April 2015).
3 Ibid.
4 Act 31 of 2014. This act regulates customs control procedures for imported and exported goods into and from the Republic of South Africa. The act was published in South Africa's Government Gazette on 23 July 2014 and will enter into force once it has been proclaimed by the president of South Africa, as provided for in sec 944 of the act.
5 Act 30 of 2014. This act regulates the imposition, assessment and collection of customs duties, and will similarly come into force once it has been proclaimed by the president of South Africa. It was published in the Government Gazette on 10 July 2014.
6 Act 32 of 2014. This act amends the Customs and Excise Act, 1964, which regulates the levying of customs and excise duties. It will also come into force once it has been proclaimed by the president of South Africa. It was published in the Government Gazette on 23 July 2014.
7 Act 91 of 1964.
8 At the moment, the 1964 Act continues to regulate customs related matters on imported and exported products, such as the levying of duties for customs and excise, and the imposition and administration of taxes; consequently it implements and enforces legislative obligations on traders for this purpose. However, appreciating that this act does not accord with international best practice pertaining to customs procedures, such as that set forth in the Revised Kyoto Convention and by the World Trade Organization, the CM Programme embarks upon replacing the current customs legislation with the three new acts mentioned above. (The International Convention on the Simplification and Harmonization of Customs Procedures, commonly referred to as the Kyoto Convention, came into force in 1974, as a result of the increasing influence of the WTO agreements. It was subsequently revised in 1999. The convention hence came to be known as the Revised Kyoto Convention, which came into force in 2006 and endeavours to increase transparency and predictability in customs administration.)
9 Marrakesh Agreement Establishing the World Trade Organization (15 April 1994) The Legal Texts: The Results of The Uruguay Round of Multilateral Trade Negotiations 4 (1999), 1867 UNTS 154, (1994) 33 International Legal Materials 1144 (Marrakesh Agreement or WTO Agreement). The WTO was established by the Marrakesh Agreement, which consists of a preamble, 16 articles, four annexures and declarations, decisions and understandings. The agreement covers goods, services and intellectual property, with underlying principles of liberalization, commitments to lower customs tariffs and other trade barriers, subject to certain permitted exceptions.
10 WTO Agreement on Trade Facilitation, ministerial decision: WT/MIN(13)/36 - WT/L/911 (11 December 2013).
11 Id, art 14.1(a).
12 Id, art 14.1(b).
13 The WTO's General Council adopted the Protocol of Amendment on 27 November 2014, officially inserting the TFA into annex 1A of the WTO Agreement. As a result, the Preparatory Committee for Trade Facilitation is responsible for expediting the entry into force of the TFA and ensuring its efficiency thereafter. For a detailed discussion of the procedure for the Protocol of Acceptance, see WTO “How to accept the Protocol of Amendment to insert the WTO Trade Facilitation Agreement into annex 1A of the WTO Agreement” (14 April 2015), available at: <https://www.wto.org/english/tratop_e/tradfa_e/tradfa_agreement_e.htm> (last accessed 20 April 2015). According to WTO rules, the TFA, like any other WTO agreement, will not come into effect until it has been ratified by at least two thirds of members. Subsequently, the agreement will only create binding obligations on the members that have ratified it. To date only five WTO members have accepted the Protocol of Amendment: Hong Kong, China, the United States of America, Singapore and Mauritius.
14 South Africa is ranked 61st out of 189 countries with respect to the ease of starting a business in the country, according to the World Bank's 2015 “Doing business” report. The ease of starting a business in South Africa is therefore more difficult in 2015 than it was in 2014 when the country ranked 55th. See World Bank “Doing business 2015: Going beyond efficiency: Economic profile 2015: South Africa” (2015) at 18, available at: <http://documents.worldbank.org/curated/en/124391468114549588/pdf/921280WP0Box380outh0Africa00Public0.pdf> (last accessed 10 September 2016).
15 The current discussion draws heavily from the section on “Bali ministerial conference, 2013 and the provisions of the Agreement on Trade Facilitation: An overview” in Khanderia-Yadav, S “What the World Trade Organization's Agreement on Trade Facilitation would mean to the emerging economies” (2015) 12/1 Manchester Journal of International Economic Law 33 Google Scholar at 44.
16 The concept of trade facilitation owes its origins to the Barcelona Convention and the Statute on the Freedom of Transit, 1921 (7 LNTS 11, 20 April 1921) coupled with the International Convention Relating to the Simplification of Customs Formalities, 1923 (30 LNTS 371, 3 November 1923). The World Customs Organization includes the mandate of trade facilitation via: the International Convention on the Simplification and Harmonization of Customs Procedures, 1974 (commonly referred to as the Kyoto Protocol: OJL 100, 21/04/1975, 1, 18 May 1973, amended 2006); the Resolution of the Customs Co-Operation Council on the Framework of Standards to Secure and Facilitate Global Trade (June 2005), available at: <http://www.wcoomd.org/en/about-us/legal-instruments/~/media/18A4FCBBFBED41688CB72D9A510B4FA8.ashx> (last accessed 2 April 2015); and the Harmonized Community Code Description and Coding System that was established in collaboration with the WTO. In addition, trade facilitation is also a mandate of international organizations, such as the United Nations Conference on Trade and Development, the UN Economic Commission for Europe (UNECE) via the UN Centre for Trade Facilitation and Economic Business (UN/CEFACT), the International Chamber of Commerce, the International Civil Aviation Organization, the International Maritime Organization, the International Organization for Standardization, the Organization for Economic Co-operation and Development (OECD), the World Bank and the WTO General Agreement on Tariffs and Trade (GATT). For a more detailed discussion of trade facilitation as part of the work programme of these conventions and organizations, see generally JG de Matons “Facilitation of transport and trade in Africa” in de Matons, JG A Review of International Legal Instruments: Facilitation of Transport and Trade in Africa (2nd ed, 2014, International Bank for Reconstruction and Development / World Bank Publications) 13 Google Scholar at 17–20, available at <https://www.ssatp.org/sites/ssatp/files/legal-instruments-en/Chapters/SSATP-Legal-Review-Chapter-II.pdf> (last accessed 10 April 2015); T Yasui “Benefits of the Revised Kyoto Convention” (30 October 2014), available at: <http://www.carecprogram.org/uploads/events/2014/CCC-TA-Workshop-AZB/Key-Documents/009_112_213_Benefits-of-the-Revised-Kyoto-Convention.pdf > (last accessed 15 April 2015); and Ireland, R “The WCO SAFE framework of standards: Avoiding excess in global supply chain security policy” (2009) 4/11–12 Global Trade and Customs Journal 341 Google Scholar.
17 See also JS Wilson and C Mann et al “Trade facilitation: A development perspective in the Asia Pacific region” (October 2002, APEC Secretariat and World Bank), available at: <http://siteresources.worldbank.org/INTTRADERESEARCH/Resources/544824-1320091873839/TradeFacilitationInAPEC.pdf> (last accessed 7 April 2015). These authors opine similarly that there is no common understanding of how “trade facilitation” can be defined.
18 See UNECE “National trade facilitation bodies: Recommendation no 4” (2nd ed), adopted by UN/CEFACT, ECE/TRADE/242, Geneva, October 2001, para 15, available at: <http://www.unece.org/fileadmin/DAM/cefact/recommendations/rec04/rec04_ecetrd242e.pdf> (last accessed 10 April 2015); and UN/CEFACT “Recommendation no 4: National trade facilitation bodies CEFACT” (1974, UN, Geneva), which also defined the concept of trade facilitation. The mandate of trade facilitation also sees reflections in the provisions of GATT, 1947. Khanderia-Yadav “What the World Trade Organization's Agreement”, above at note 15 at 37–41. In particular, GATT, 1947, arts V, VIII and X endeavour to ease customs rules and border related procedures, with the effect of reducing transaction costs between nations and consequently promoting free trade. In this regard, GATT, 1947, art V strives to promote freedom in transit so as to reduce unwarranted delays in international trade. Art XIII underscores the need to reduce fees and other customs related formalities so as to be proportionate to the cost of services rendered. Lastly, art X promotes transparency in international trade so as to increase competitiveness.
19 WTO “WTO: A training package: What is trade facilitation?” (1998).
20 Hansen, P and Annovazzi-Jakab, L “Facilitating cross border movement of goods: A sustainable approach” in Lawrence, RZ, Blanke, J, Hanouz, MD and Moavenzadeh, J The Global Enabling Trade Report (2008, World Economic Forum) 67 Google Scholar at 67, available at: <http://www.weforum.org/pdf/GETR08/Chap%201.5_Facilitating%20Cross-Border%20Mvt%20of%20Goods.pdf> (last accessed 25 April 2015).
21 A Portugal-Perez and JS Wilson “Trade costs in Africa: Barriers and opportunities for reform” (2008, The World Bank Development Research Group policy research working paper no 4619) at 4–18, available at: <http://siteresources.worldbank.org/INTRANETTRADE/Resources/Internal-Training/Portugal-Perez_Wilson_Trade_Costs_Africa_paper.pdf> (last accessed 20 April 2015).
22 “Trade facilitation and intra-African trade” at 203, available at: <http://www.mcli.co.za/mcli-web/downloads/ARIA4/chap6.pdf> (last accessed 30 April 2015).
23 See generally OECD “Trade costs: What have we learned? A synthesis report” (15 April 2013) (Working Party of the Trade Committee trade policy paper no 150, TAD/TC/WP(2013)3/FINAL), available at: <http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=TAD/TC/WP(2013)3/FINAL&docLanguage=En> (last accessed 10 September 2016), which underscores how non-tariff barriers can potentially double the restrictive effects of tariffs for a significant number of goods and services; C Milner “Protection by tariff barriers and international transport costs compared” (Leverhulme Centre for Research in Globalization and Economic Policy research paper no 2002/01), available at: <http://beta.nottingham.ac.uk/gep/documents/papers/2002/02-01.pdf> (last accessed 12 April 2015), which, while analysing US exports into the EU, demonstrates that non-tariff barriers in the form of high transaction costs are far more overreaching than tariffs; and De, P “Trade, infrastructure and transaction costs: The imperatives for Asian economic co-operation” (2006) 21/4 Journal of Economic Integration 708 CrossRefGoogle Scholar.
24 See generally H Wagner “Costs of legal uncertainty: Is harmonization of law a good solution?” (paper presented at UNCITRAL Modern Law for Global Commerce Congress, Vienna, 9–12 July 2007), available at: <http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.532.3794&rep=rep1&type=pdf> (last accessed 10 September 2016); and Pomar, FG “The harmonization of contract law through European rules: A law and economics perspective” (2008) 2 InDret Google Scholar, available at: <http://www.indret.com/pdf/535_en.pdf> (last accessed 12 April 2015), which argues that diversity in legal rules increases transaction costs.
25 See WTO “Preparatory Committee on Trade Facilitation: Notifications of category A commitments under the Agreement On Trade Facilitation” (23 March, 2015) WT/PCTF/W/29 for a list of notifications made by members in this regard.
26 WTO Ministerial Declaration of 13 December 1996, WT/MIN(96)/DEC: (1997) 36 International Legal Materials 218, para 21 (Singapore ministerial conference).
27 WTO Ministerial Declaration of 14 November 2001, WT/MIN(01)/DEC/1: (2002) 41 International Legal Materials 746, para 27 (Doha ministerial conference), read along with WTO “The Doha development programme” WT/L/579, 2 August 2005 (also known as the July Package, 2005), which sets out the agenda as follows: “Recognizing the case for further expediting the movement, release and clearance of goods, including goods in transit, and the need for enhanced technical assistance and capacity building in this area, we agree that negotiations will take place after the fifth session of the ministerial conference on the basis of a decision to be taken, by explicit consensus, and that session on modalities of negotiations. In the period until the fifth session, the Council for Trade in Goods shall review and, as appropriate, clarify and improve relevant aspects of arts V, VIII and X of GATT, 1994 and identify the trade facilitation needs and priorities of members, in particular developing and least-developed countries. We commit ourselves to ensuring adequate technical assistance and support for capacity building in this area.”
28 TFA, art 13.
29 “Category A notifications” can be found on the WTO website at: <https://docs.wto.org/dol2fe/Pages/FE_Search/FE_S_S001.aspx> (symbol: WT/PCTF/*) (last accessed 4 August 2016). See WTO “Preparatory Committee on Trade Facilitation: Agreement on Trade Facilitation” WT/L/931 (15 July 2014) for the legal review and category A notifications.
30 WTO “Trade Facilitation: WTO members debate future work on trade facilitation as deadlock on protocol remains” (29 September 2014), available at: <www.wto.org/english/news_e/news14_e/fac_29sep14_e.htm> (last accessed 15 April 2015).
31 This section draws on a similar discussion in a paper written by the author; see Khanderia-Yadav “What the World Trade Organization's Agreement”, above at note 15 at 48–57.
32 WTO “A trade facilitation deal could give a $1 trillion boost to world economy: Lamy” (1 February 2013), available at: <www.wto.org/english/news_e/sppl_e/sppl265_e.htm> (last accessed 15 April 2015).
33 WTO “Doha Development Agenda: Trade negotiations” (annual report, 2014) at 4, available at: <www.wto.org/english/res_e/booksp_e/anrep_e/anrep14_chap5_e.pdf> (last accessed 12 April 2015).
34 HK Nordås, E Pinali and MG Grosso “Logistics and time as a trade barrier” (30 May 2006, OECD Trade Policy working paper no 35: TD/TC/WP(2006)3/FINAL), available at: <www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?doclanguage=en&cote=td/tc/wp(2006)3/final> (last accessed 17 April 2015).
35 M Engman “The economic impact of trade facilitation” (12 October, 2005, OECD Trade Policy working paper no 21: TD/TC/WP(2005)12/FINAL), available at: <http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=TD/TC/WP%282005%2912/FINAL&docLanguage=En> (last accessed 17 April 2015).
36 S Djankov, C Freund and C Pham “Trading on time” (2010) at 4, available at: <http://www.doingbusiness.org/~/media/FPDKM/Doing%20Business/Documents/Methodology/Supporting-Papers/DB-Methodology-Trading-On-Time.pdf> (last accessed 5 April 2015).
37 Direct costs are those that impact customs fees, payments and port handling changes by virtue of cross border inefficiencies.
38 Acceleration of costs caused by inefficiencies in the time taken to complete pre-shipment inspections, processing of shipments or transit is considered an indirect cost.
39 OECD “Business benefits of trade facilitation” (2001, Working Party of the Trade Committee: TD/TC/WP(2001)21/FINAL), available at: <http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=TD/TC/WP%282001%2921/FINAL&docLanguage=En> (last accessed 17 April 2015). Compare with P Minor and M Tsigas “Impacts of better trade facilitation in developing countries: Analysis with a new GTAP database for the value of time in trade” (2008, Nathan Associates Inc research report) at 3, available at: <https://www.gtap.agecon.purdue.edu/resources/download/4036.pdf> (last accessed 17 April 2015).
40 World Economic Forum “Enabling trade: Valuing growth opportunities” (2013) at 37, available at: <www3.weforum.org/docs/WEF_SCT_EnablingTrade_Report_2013.pdf > (last accessed 20 April 2015).
41 Hummels, D and Schaur, G “Time as a trade barrier” (2013) 103/7 American Economic Review 2935 CrossRefGoogle Scholar.
42 K Joosep “Trade facilitation as a means to improve SME competitiveness and consumer welfare in developing and least-developed countries” (CUTS international briefing paper no 1, 2014) at 5, available at: <http://www.cuts-geneva.org/pdf/BP-2014-1-Trade%20Facilitation%20SMEs%20and%20Consumers.pdf> (last accessed 20 April 2015).
43 Id at 4–5.
44 World Bank “Doing business”, above at note 14 at 67.
45 Id at 66–69. According to the report, it requires five documents, 16 days and USD 1,830 to export a standard container from South Africa. On the other hand, it requires six documents, 21 days and USD 2,080 to import a similar standard container into South Africa. The report further demonstrates that trade facilitation in terms of the cost of import and export have increased since the previous year (2014), when it cost USD 1,705 to export a standard container from South Africa and USD 1,980 to import a similar container into South Africa.
46 Id at 67. In a related vein, the 2015 report highlights that a mere 10% reduction in these trading costs would enable developing countries to reap greater benefits than the reduction of tariffs would entail.
47 For an understanding of trade policies in South Africa before it joined the WTO, see Roberts, S and Thoburn, J “Globalization and the South African textiles industry: Impacts on firms and workers” (2004) 16/1 Journal of International Development 125 CrossRefGoogle Scholar; and Evenett, S “The impact of economic sanctions in South African exports” (2002) 49/5 Scottish Journal of Political Economy 557 CrossRefGoogle Scholar.
48 For a detailed discussion of South Africa's trade liberalization strategies to ensure compliance with WTO standards, see P Belli, M Finger and A Ballivian “South Africa: A review of trade policies” (1993) (World Bank informal discussion paper on aspects of the South African economy, no 4, the Southern Africa Department, The World Bank), available at: <http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2000/02/03/000009265_3961006075001/Rendered/PDF/multi_page.pdf> (last accessed 19 April 2015); Harmse, C and Rangasamy, L “The extent of trade liberalization in the 1990s: Revisited” (2003) 71/4 South African Journal of Economics 705 Google Scholar; Department of Trade and Industry, Republic of South Africa “A national industrial policy framework”, available at: <http://www.thedti.gov.za/industrial_development/docs/niPF-3aug.pdf> (last accessed 1 April 2015); and Tregenna, F and Kwaramba, M “An institutional analysis of the International Trade Administration Commission of South Africa” (2014) 7/S Journal of Economic and Financial Sciences 641 Google Scholar.
49 International Trade and Economic Development Division, Department of Trade and Industry, South Africa “A South African trade policy and strategy framework” (May 2010) at xiv, available at: <http://www.tralac.org/files/2012/12/Trade-Policy-and-Strategy-Framework-2010.pdf> (last accessed 20 April 2015). South Africa is thus a signatory to a number of regional trade agreements, such as the Southern African Customs Union (SACU), which was signed in 1910 and is the oldest such agreement, and the Southern African Development Community (SADC) signed in 1994 and coupled with the SADC Protocol in 2000, which witnessed a substantial liberalization of trade with 99% of tariffs and 97% of imports from SADC qualifying for duty-free access to South Africa. Moreover, South Africa has also been a party to the Economic Partnership Agreement with the European Union since 2000, the Africa Growth and Opportunity Act with the United States, the SACU-USA Trade, Investment, Development and Corporation Agreement in 2008, the MERCOSUR with SACU in 2009, and most recently the BRICS Agreement with Brazil, Russia, India and China in 2010.
50 P Dunne and L Edwards “Trade and poverty in South Africa: Exploring the trade-labour linkages” (2006, South Africa Labour and Development Research Project, University of Cape Town), available at: <http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.537.5192&rep=rep1&type=pdf> (last accessed 10 September 2016).
51 Department of Trade and Industry “A South African trade policy”, above at note 49 at 11.
52 See J Lewis “Reform and opportunity: The changing role and patterns of trade in South Africa and SADC” (2001, World Bank, Africa region working paper series 14) at 1.
53 This means that, even though South Africa is now a member of the WTO, the mere reduction of tariffs would not be considered sufficient when these reductions have not been complemented by and supplemented at the same time as domestic or national policies that stimulate growth, such as improvements in infrastructure, high competitiveness, increased transparency and reduced corruption.
54 WTO “Trade profile: South Africa” (September 2014), available at: <http://stat.wto.org/CountryProfile/WSDBCountryPFView.aspx?Language=F&Country=ZA > (last accessed 2 May 2015). On the other hand, South Africa's tariff-binding rate on manufactured products is 99.37%, according to World Bank indicators; see Edwards, L “Has South Africa liberalised its trade?” (2005) 73 South African Journal of Economics 754 CrossRefGoogle Scholar at 754–56.
55 Edwards, id at 756.
56 South African Revenue Service Act 37 of 1997, by virtue of which SARS is an autonomous organ with administrative responsibilities.
57 SARS “Customs modernization” available at: <http://www.sars.gov.za/ClientSegments/Customs-Excise/AboutCustoms/Pages/Modernisation.aspx> (last accessed 2 May 2015); SARS “Customs modernization: Moving into the future”, available at: <http://www.saaffkzn.co.za/web/webroot/files/articles/1294/60983_TRADERSPOCKETGUIDEv4.pdf > (last accessed 2 May 2015).
58 The acts are presumed to come into force in 2015 / 2016.
59 Above at note 8.
60 In a similar context, research demonstrates that facilitation of trade is highly dependent on infrastructure, but at the same time is also dependent on administrative developments, with hurdles in the latter in the form of customs and tax procedures and clearance being even more detrimental to the facilitation of trade. For a detailed discussion of the former, see Global Event of Landlocked Developing Countries and Transit Countries on Trade and Trade Facilitation “Trade, trade facilitation and transit transport issues for landlocked developing countries”, available at: <http://www.unohrlls.org/UserFiles/File/Elle%20Wang%20Uploads/LLDCs%20Publication.pdf > (last accessed 2 May 2015); and Djankov et al “Trading on time”, above at note 36 at 9.
61 OECD “OECD trade facilitation indicators: State of implementation” (June 2014), available at: <http://www.oecd.org/tad/facilitation/TFI-state-implementation-june-2014.pdf > (last accessed 2 May 2015). Compare with E Moïsé, T Orliac and P Minor “Trade facilitation indicators: The impact on trade costs” (2011, OECD Trade Policy working paper no 118), available at: <https://www.wto.org/english/tratop_e/tradfa_e/case_studies_e/oecd_paper_e.pdf> (last accessed 4 May 2015), which identifies a set of 12 variables that rely on the WTO's Draft Consolidated Negotiating Text on Trade Facilitation that also contains 12 parameters of trade facilitation, in 12 articles. Interestingly, these 12 indicators have been re-organized into a set of 16 parameters laid out in the OECD policy paper that analyses the cost of trade facilitation on the developing world. Compare with OECD “Trade facilitation indicators: The potential impact of trade facilitation on developing countries' trade” (2013, OECD Trade Policy paper no 144), available at: <http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=TAD/TC/WP%282012%2924/FINAL&docLanguage=En> (last accessed 1 May 2015).
62 Available at: <http://www.oecd.org/tad/facilitation/south-africa-oecd-trade-facilitation-indicators-april-2014.pdf> (last accessed 4 August 2016).
63 The author restricts the discussion to the implementation of trade facilitation through the new legislative enactments simply because the current 1964 Act will eventually be replaced by the new legislation. Besides, as mentioned in the introductory remarks, the 1964 Act does not successfully enforce the mandates of contemporary international trade rules (primarily those of the Revised Kyoto Convention and the WTO) in a globalized era.
64 Above at note 62.
65 Ibid.
66 TFA, art 1.1, 1.2, and 1.3, encourages the publication of regulations pertaining to import, export and transit procedures for the convenience of traders. It also recognizes the need to establish enquiry points across the jurisdictions of member states along with such provisions in customs unions or other applicable regional agreements for the benefit of traders and businesses.
67 Id, art 2 builds upon art 1.2.
68 Id, art 3.9(a), which defines an advance ruling as “a written decision provided by a Member to an applicant prior to the importation of a good covered by the application that sets forth the treatment that the Member shall provide to the good at the time of importation with regard to: i) the good's tariff classification, and ii) the origin of the good”.
69 Id, art 3, which recognizes the need for advance rulings by underscoring the fact that inconsistent decisions across customs authorities often work to the detriment of traders and indeed foreign investment. Hence, investors and business houses prefer to relocate to nations with predictable rules. Accordingly, art 3.9(b) states that a member must provide advance rulings, among other things, in the manner in which customs duties are calculated along with the exceptions and quotas applicable with regard to such duties.
70 These obligations are mainly set out in art 1.1 of the TFA.
71 CCA, chap 4, part 3, secs 109–15 pertain to the “General principles governing goods under customs procedures” and contain regulations regarding commencement and ending of customs procedures, clearance and release, transfer of ownership and tax related matters.
72 Id, chaps 16 and 17.
73 Documents required to be endorsed for customs purposes are listed on the SARS website, available at: <http://www.sars.gov.za/ClientSegments/Customs-Excise/AboutCustoms/Pages/Documentation.aspx> (last accessed 10 May 2015).
74 Procedures for transit are set forth in the CCA, chaps 9 and 10 and regulate national and international transit along with excise warehouse transit.
75 South Africa is a signatory to the WCO International Convention on the Harmonised Commodity Description and Coding System and implements the 2012 version of the harmonised classification as well (see Government Gazette no 34772). The convention regulates the classification of imported goods with respect to the imposition of duties pertaining to customs, excise, ad valorem, antidumping and countervailing. For a detailed discussion of South Africa's tariff book, see: <http://www.sars.gov.za/Legal/Primary-Legislation/Pages/Schedules-to-the-Customs-and-Excise-Act.aspx> (last accessed 18 May 2015).
76 The CCA, chap 41, sec 921 provides for publication of the international agreement(s) to which South Africa is a party.
77 Legislative enactments pertaining to customs related rules and procedures are also published on the SARS website, available at: <http://www.sars.gov.za/Legal/Primary-Legislation/Pages/Acts-administered-by-the-Commissioner.aspx> (last accessed 10 May 2015).
78 <www.sars.gov.za> (last accessed 4 August 2016).
79 TFA, art 1.1, which mandates the establishment of enquiry points by members at the national level.
80 SARS held workshops in 2014 in order to discuss the comments that were received from stakeholders regarding the draft Customs Control Rules. Accordingly the draft Customs Control Rules were published in phases, for the benefit of stakeholders. The first batch consisted of chaps 1–3 and 10 in June 2014, with a due date of 29 July 2014. The second batch was published on 4 August 2014 with a due date of 26 September 2014, consisting of chaps 11–20 and 24. The third was published on 9 October 2014 with a due date of 14 November 2014 and consisted of chaps 21, 23 and 25–31. The remaining chapters of the CCA were proposed to be published in a fourth phase. The fifth batch would include the CDA rules for comment. For a detailed discussion of the SARS workshops, see: <http://www.sars.gov.za/Legal/Preparation-of-Legislation/Pages/Workshops.aspx> (last accessed 10 September 2016).
81 TFA, art 2.2.
82 See CCA, sec 944, CDA, sec 229 and CEAA, sec 88.
83 Agreement on Rules of Origin (15 April 1994), Marrakesh Agreement, The Legal Texts: The Results of the Uruguay Round of Multilateral Trade Negotiations 17 (1999), 1868 UNTS 397, (1994) 33 International Legal Materials 1143.
84 CDA, sec 1(1).
85 Id, chap 10, secs 187–98.
86 Id, sec 188.
87 Id, sec 191.
88 Id, sec 192.
89 Id, sec 193.
90 Id, sec 194.
91 Id, sec 195.
92 Id, secs 100(1)–(3), 117(2)(b), 118, 153(2)(a) and 154(3).
93 Id, secs 116(1)(a), 116(3)(b), 152(1)(a) and 152(3)(b).
94 According to the SARS website, only 70% of the CCA and the CDA would be implemented in the first phase (originally proposed for June / July 2015), which would not include, inter alia, chap 10 governing advance rulings. See: <http://www.sars.gov.za/AllDocs/LegalDoclib/Bills/LAPD-LPrep-Bill-2014-08%20-%20Strategic%20Stakeholder%20Meeting%20Implementation%20Customs%20Legislation.pdf> (last accessed 9 May 2015) at 6.
95 CDA, sec 838.
96 TFA, art 4.
97 CCA, secs 838 and 839.
98 Id, sec 840.
99 Id, sec 845(c).
100 Compare with id, secs 838–45, which are also applicable to SARS officers in addition to customs authorities.
101 TFA, art 4.5 and 4.6.
102 “Administrative appeal” has the same meaning and scope as that expressed in CCA, part 3 of chap 37.
103 CDA, sec 92.
104 See id, secs 107, 120 and 160.
105 TFA, art 5.
106 Id, art 5.1.
107 Id, art 5.2.
108 Id, art 5.3.
109 SADC “Sanitary and phytosanitary (SPS) annex VIII to the SADC Protocol on Trade” (17 July 2014), available at: <http://www.sadc.int/files/2114/1520/0828/SPS_Annex_to_the_SADC_Protocol_on_Trade_-_Approved_Version_-_17_July_2014_-_English.pdf> (last accessed 30 April 2015).
110 Dept of Agriculture, Forestry and Fisheries “Draft sanitary and phytosanitary strategy” (January 2014), available at: <http://sansor.org/wp-content/uploads/2012/09/Draft-Strategy-January-2014.pdf> (last accessed 17 April 2015).
111 CCA, sec 757.
112 Id, sec 722(3)(d).
113 Id, sec 724(2)(a).
114 Compare with TFA, art 5.3.1.
115 Compare with id, art. 5.3.2.
116 GATT, 1994, art III pertains to internal taxes. A tax or charge is considered to be “internal” when it is applied within the border of the importing country.
117 TFA, art 6.1.2 and 6.1.3.
118 Id, art 6.3.
119 South Africa's performance in this regard is rated by the OECD as 1.3 on a scale of 0–2, with 2 being the best performance.
120 CCA, sec 585. Goods may be stored on licensed premises in the form of a customs storage warehouse, special storage warehouse, bonded warehouse, manufacturing warehouse or state warehouse. See: <http://www.gov.za/sites/www.gov.za/files/37862_gon582.pdf> (last accessed 2 September 2016) and 1964 Act.
121 CCA, chap 39, secs 874–85.
122 Id, chap 40, secs 886–901.
123 TFA, art 7.2.
124 Id, art 7.1.
125 Id, art 7.4.
126 Id, art 7.5. Khanderia-Yadav “What the World Trade Organization's Agreement”, above at note 15 at 46.
127 Revised Kyoto Convention, art 7.8 and 7.9.
128 CCA, art 170.
129 Id, secs 169 and 913.
130 CDA, sec 60. Compare with CDA, sec 706, which recognizes electronic payments as a method that may be used to pay a debt.
131 SARS now incorporates “e@syFile software” for the benefit of importers, exporters and customs brokers who can now upload customs documents with ease. See: <http://www.sarsefiling.co.za/> (last accessed 10 May 2015).
132 See CCA, chap 24, secs 518–39, in particular secs 530 and 533.
133 Gilfer “South Africa: Statistic extracts from the SARS annual report” (6 May 2013) (copy on file with the author).
134 Above at note 49. SACU “Quarterly SACU customs bulletin October to December 2011”, available at: <http://www.sacu.int/newsletters/2011/thirdquarter.pdf > (last accessed 2 May 2015). See also World Customs Organization “WCO trends and patterns report: A capacity building estimate” (issue 3: June 2008) at 29, available at: <http://wcoomdpublications.org/downloadable/download/sample/sample_id/24/> (last accessed 2 May 2015).
135 CCA, chap 24 pertains to the expedited clearance and release of goods, while chap 30 deals with accreditation. In this regard, sec 1(1) of the CCA defines an accredited person as a person who “is a registered person or licensee [to whom] an accredited client status certificate has been issued in terms of Chapter 30”.
136 Compare with TFA, art 7.8.
137 Border Control Operational Coordinating Committee, Republic of South Africa “About us”, available at: <http://www.borders.sars.gov.za/Documents/ABOUT-US-BCOCC.pdf> (last accessed 2 May 2015).
138 While South Africa's performance is ranked as 2 (being the best performance) in terms of both internal and external border co-operation, world performance averages 1.9 (2 in terms of internal border co-operation but 1.8 in terms of external border co-operation).
139 UN Economic Commission for South Africa (UNECA) “Trade facilitation from an African perspective” (2013) at 35–36, available at: <http://www.uneca.org/sites/default/files/PublicationFiles/trade_facilitation_eng.pdf> (last accessed 10 September 2016).
140 “BRICS customs agencies to cooperate” (14 March 2013) SouthAfrica.info, available at: <http://www.southafrica.info/global/brics/customs-140313.htm#.V9PbBqN_ymx > (last accessed 10 September 2016).
141 South Africa and Zimbabwe Customs Mutual Assistance Agreement, signed 8 April 2015. This agreement has not yet been ratified. See “South Africa, Zimbabwe strengthen relations” (9 April 2015) SouthAfrica.info, available at: <http://www.southafrica.info/news/international/south-africa-zimbabwe-090415.htm#.VVMjutOqqko> (last accessed 2 May 2015).
142 Trade, Development and Co-operation Agreement “Council decision 2004/441/EC, OJ L 311, 04.12.1999” (1 January 2004), as amended by a decision of the Council of the European Union on 26 April 2004, available at: <http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32004D0441&from=EN> (last accessed 2 May 2015).
143 South Africa has been a member of the Mutual Legal Assistance Treaty and Customs Mutual Assistance Agreement with Canada since 2001 and 2010 respectively.
144 CCA, sec 44.
145 TFA, art 10.
146 The single window system, which is encouraged by art 10 of the TFA, aims to simplify procedures in international trade by requiring traders to provide certain information by means of necessary documents that are, where possible, only provided once. This in turn reduces delay in international trade when countries that incorporate and participate in the system are enabled to access information from other partner countries electronically.
147 Countries that currently incorporate the single window include Finland, Germany, Ghana, Republic of Korea, Malaysia, Mauritius Singapore and United States of America. The experiences of these countries may be found on the UNECE database at: <www.unece.org/cefact/single_window/welcome.html> (last accessed 10 May 2015). See Khanderia-Yadav “What the World Trade Organization's”, above at note 15, footnote 79.
148 On the other hand, a large number of African countries have introduced single windows to facilitate trade. For instance, the Zimbabwe Revenue Authority has progressively implemented these at all major ports. The country is also part of the ASYCUDA system to allow national revenue authorities to access data. Uganda also uses ASYCUDA World, an advanced version of the system, permitting customs declarations from the rest of the world. Other African member nations include Ghana, Kenya, Madagascar, Mauritius, Rwanda, Senegal and Tunisia. Reference may be made to the single window system incorporated by Ghana, Madagascar and Mozambique. South Africa incorporated the mandate of a single window in order to simplify prevalent norms for customs evaluation and has been a continuous example for various other developing and least developed nations. Hence, while Mozambique faced several challenges in terms of infrastructure in order to give effect to the mandate, the country is now able to handle more than 1,500 customs evaluations per day with the incorporation of a single window system. See Khanderia-Yadav id, footnote 80.
149 CCA, chap 24.
150 TFA, art 10.3.
151 1868 UNTS 368.
152 See CCA, chap 1, part 1, sec 1 for the definition of customs brokers.
153 The following sections of the CCA govern the use of customs brokers: 165(1)(b), 165(3), 166(2), 167(i), 177(c), 186(3), 189(e), 201(g), 225(b), 248(1)(c), 267(1)(c), 274(d), 302(1)(e), 302(2)(c), 320(b), 340(d), 366(c), 386(c), 413(c), 420(d), 440(c), 459(c), 467(b), 523(h)(i), 542(2)(b), 549(3)(b) and 589(2)(g).
154 SARS “Importation of unaccompanied goods into South Africa” (July 2016), available at: <http://www.sars.gov.za/AllDocs/OpsDocs/Guides/Customs-G002%20-%20Guide%20on%20Importation%20of%20unaccompanied%20goods%20-%20External%20Guide.pdf > (last accessed 2 May 2015).
155 TFA, art 11.3.
156 Id, art 11.2.
157 Id, art 11.4.
158 Id, art 11.5.
159 Id, art 11.14.
160 Id, art 11.6–11.13.
161 South Africa embraces the freedom of transit through a number of international conventions: the GATT-WTO; Kyoto Convention; Nairobi Convention on Mutual Administrative Assistance for the Prevention, Investigation and Repression of Customs Offences; Geneva Convention on Harmonization of Frontier Control of Goods; Montego Bay Convention on Landlocked Countries; Almaty Programme of Action; and regional conventions such as those forming the Common Market for Eastern and Southern Africa, SACU and SADC. See UNECA “Trade facilitation”, above at note 139 at 32–34 and 61. Compare with R Tama Lisinge “Leveraging WTO negotiations on trade facilitation to operationalize the Almaty Programme of Action” (November 2008, UNECA-African Trade Policy Centre, work in progress no 71), available at: <http://www1.uneca.org/Portals/atpc/CrossArticle/1/WorkinProgress/71.pdf> (last accessed 10 September 2016).
162 UNECA “Trade facilitation”, id at 32 and 34.
163 This is because category A notifications consist of provisions that the respective member undertakes to implement before the commencement of the TFA. Given that the CCA, CDA and CEAA will only be implemented after the requisite proclamation by the president, it is understood that none of the provisions under the umbrella of these acts is yet in force.
164 Above at note 62.