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BPL Inform - August 2018

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August 2018

 

APPLICATIONS FOR CHANGES IN CUSTOMS DUTIES

 

The following applications for changes in rates of customs duty were published in the past month. Interested parties must submit comments to ITAC within 4 (four) weeks of the date the notice was first published unless otherwise stipulated.

 

Reductions

 

Government Gazette 41781 – 07.20.2018

 

  1. Amendment of tariff item 6210.10.20: "disposable panties of fabrics of heading 56.03" to read "disposable underwear of fabrics of heading 56.03".

     

    SAFEGUARD DUTIES - CALL FOR COMMENTS

     
    On 20th July ITAC published Notice 402 of 2018 (Gazette no 41781) giving all interested parties just 10 calendar days to comment on a proposed "attached reference and procedural guide" in terms of Article 34 of the EPA. The notice adds that ITAC will finalise the guidelines after considering all comments received.

     
    For those confused by the jargon, the EPA is the European Partnership Agreement between the European Union and South Africa, Botswana, Lesotho, Namibia, Swaziland and Mozambique, often loosely referred to as the EU Trade Agreement.  Article 34 deals with the rights of the parties to introduce "safeguards" (temporary additional duty measures) to protect local producers against "disruptive" imports. 

     
    The "attached reference and procedural guide" was not published: with its potential to affect the business of anybody importing goods from the European Union, the proposed guideline is a mystery. We assume that the commission, content in the knowledge that no adverse comments were received, will eventually simply go ahead and implement the guideline, be it good, bad or indifferent. 

     
    Given the circumstances we cannot but wonder if the omission and timeframe are accidental or not.

 

NEW UCR DELAYED

Implementation of the revised requirements for Universal Consignment Reference Numbers (UCRs) outlined in our July issue has been deferred by SARS to 17th August.

All import, export and transit traffic within the common customs area that South Africa shares with Botswana, Lesotho, Namibia and Swaziland must move against exporter generated UCRs. These must now identify the type of registration number used (e.g. exporter or importer's registration number, tax registration or identity number) as well as what the quoted reference number relates to (e.g. Invoice, order number etc.).

 

PROOF OF EXPORT

Exporters who nominate their own transporters for road exports from South Africa must make sure that proof of export is obtained by their transporters when exiting the border post from South Africa. The exporter must retain this proof on file for a minimum of five years as evidence of entitlement to zero-rate the sale for VAT purposes. The exporter must also give Bidvest Panalpina Logistics a copy.

The CN2 document issued by SARS at the point of exit is the only acceptable proof that goods cleared for export by road have left the country. This document is issued to the truck operator at the time of exit.

 

It is the responsibility of the transporter to make certain that each consignment on board a vehicle appears on that vehicle's manifest at the time of departure from South Africa and that the CN2 is obtained at that time. SARS does not issue retrospective or duplicate CN2s.

 

Where no CN2 is available SARS assumes that the export declaration has not been acted upon and the exporter is held liable for any duties and taxes payable on the goods.

 

EGYPTIAN CUSTOMS HEAD ARRESTED

The Head of Egypt's Customs Authority was recently arrested following allegations that he accepted an E£1 000 000 (about R750 000) bribe for allowing a textile importer to bypass clearing procedures.

Egypt is currently ranked at 117th place in the world corruption index; South Africa is currently 71st along with Vanuatu and Bulgaria. Namibia is ranked at no 53 while Botswana trails behind at "only" 34. New Zealand is in the number 1 spot and currently ranks as the world's least corrupt country.

 

LITHIUM AND LITHIUM ION BATTERIES

All electrical cells and batteries containing lithium in any form are hazardous cargo. They are generally prohibited from carriage as cargo on any passenger aircraft unless falling within a specifically exempted category.

The exceptions to this rule are single items fitted with up to four cells or two batteries: typical examples are cell phones, laptops, tablets and similar electronic devices if carried by passengers, plus certain products that are supplied with a discharged battery fitted or securely packed in the same container. Also exempted are small consignments where criteria relating to the number of units per package, the total number of batteries included and the state of charge of the batteries, among other things, apply.

Batteries must be securely packed with or fitted into the equipment with which transported. Packed batteries must have all terminals protected so that they cannot accidentally contact any metal or electrically conductive surface.

 

Shippers should take note that that IATA-mandated warning labels for batteries have been redesigned and that only the new label may be used from 1st January 2019.

 

IS IT A BIRD OR A BEE OR A DONKEY?

An amusing report in weekend media at the end of July included pictures of a donkey with a trimmed mane and black/white stripes displayed at a Cairo zoo as a Zebra. http://www.asiaone.com/world/egyptian-zoo-gets-called-out-faking-zebra-painted-donkey

Despite the paint job being smudged, starting to run, and the animal having been examined by a Vet, who confirmed that it was just a donkey with a bad haircut and runny make-up, the zoo continued to insist that the animal was a Zebra.

South African customs regulations require that all goods entering or leaving the country (striped animals included) must be detailed on a commercial invoice, in English, with enough details provided to enable the animal/product to be correctly classified in terms of the Harmonised Customs Tariff. Failure to comply is a serious breach of the law and may be regarded as a false declaration, an attempt to evade duty or attempted smuggling, all of which can land an importer in hot water with substantial penalties or criminal prosecution as a result.

An increasing number of import invoices are seemingly being compiled with the assistance of Google Translate, sometimes with potentially disastrous consequences. It is the responsibility of importers to check that the invoices received from suppliers accurately and clearly describe the goods being bought; that they describe the goods in the state and condition at the time of import and that values and quantities are correct. Bidvest Panalpina Logistics has no liability for errors arising from inaccurate or incomplete information supplied by either clients or their suppliers.

 

LIFE AFTER BREXIT

"Trade ministers of the SACU states met with their UK counterpart in Johannesburg on 19th July to discuss the implications of Britain's withdrawal from the European Union, now scheduled for 1st April 2019. An announcement after the meeting said that the two sides had agreed that trade should not be disrupted by the move and that a new agreement similar to the existing one with the European Union would be signed ahead of Britain's departure from the Union."

Very little has happened since we made this statement 12 months ago: the process of Britain disengaging from the European Union has become increasingly acrimonious and complicated with seemingly very little consideration being given to trade relations with other countries after Brexit. Added to this are the 'trade wars' between the world's major economies, from which some South African businesses are already starting to experience collateral damage.

Nothing in life is ever certain; any proposed long-term supply contracts with British importers or exporters should be approached cautiously because of the uncertainties surrounding future duty regimes.