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2015/16 ANNUAL REPORT ON THE PREFERENTIAL MARKET ACCESS PROGRAMME IN TERMS OF THE SA-EU TDCA, WTO

AGREEMENT AND AGOA

Directorate: Marketing

TABLE OF CONTENTS

TABLE OF CONTENTS............................................................................................... I

ACRONYMS............................................................................................................... II

DEFINITIONS............................................................................................................. iii

1. INTRODUCTION AND BACKGROUND...............................................................1

1.1 SA – EU Trade, Development and Cooperation Agreement (TDCA)...................1

1.2 WTO Marrakech Agreement.................................................................................2

1.3 Africa Growth and Opportunity Act (AGOA)..........................................................4

2. OBJECTIVES OF THE PREFERENTIAL MARKET ACCESS PROGRAMME.....4

3. APPLICATION PROCEDURE FOR THE PREFERENTIAL MARKET ACCESS PROGRAMME......................................................................................................5

3.1 Eligibility................................................................................................................5

3.2 Method of allocation..............................................................................................6

3.3 Permit fee.............................................................................................................6

4. KEY DELIVERABLES FOR 2015/16....................................................................6

5. ANALYSIS OF FILL RATES...............................................................................13

5.1 SA-EU TDCA export quota utilization.................................................................13

6. CHALLENGES...................................................................................................16

i

ACRONYMS

SA–EU: South Africa – European Union

TDCA: Trade, Development and Cooperation Agreement

AGOA: Africa Growth and Opportunity Act

WTO: World Trade Organization

MFN: Most Favoured Nations

USA: United States of America

SAPA: South African Poultry Association

USAPEEC: USA Poultry and Egg Export Council

NCC: National Chicken Council

DAFF: Department of Agriculture, Forestry and Fisheries

DTI: Department of Trade and Industry

ITAC: International Trade Administration Commission of South Africa

BBBEE: Broad-Based Black Economic Empowerment

HDIs: Historically Disadvantaged Individuals

SAFVCA: South African Fruit & Vegetable Canners' Association

SARS: South African Revenue Service

WOSA: Wine of South Africa

SA: South Africa

Q: Quarter

FTA: Free Trade Area

2015/16 ANNUAL REPORT ON THE PREFERENTIAL MARKET ACCESS PROGRAMME IN TERMS OF THE SA-EU TDCA, WTO AGREEMENT AND AGOA Page ii

DEFINITIONS

“AGOA” is part of the Trade and Development Act of 2000 of the USA that provides 37 beneficiary countries in sub-Saharan Africa with liberal access to the USA market for a list of selected products.

“Anti – dumping duties” means the anti-dumping duties in force on Bone in cuts originating in or imported from the United States of America as listed in Schedule No.2 part 1 to the Customs and Excise Act.

“Customs and Excise Act” means the Customs and Excise Act, 91 of 1964 (as amended) and indicates a reference to the Customs Duty Act, 30 of 2014 after it came into force.

“Agri-BEE” is a sector code as defined in section 12 of the Broad-Based Black Economic Empowerment act 53 of 2003

“Free Trade Area” is a group of two or more countries or economies, customs territories in technical language, that have eliminated tariff and all or most non-tariff measures affecting trade among themselves. Participating countries usually continue to apply their existing tariffs on external goods.

“HDIs” mean historically disadvantaged individuals as defined in the Broad Based Black Economic Empowerment Act, 53 of 2003 (as amended).

“Most Favored Nations” is the tariff applied by WTO members to goods from other WTO members. In the case of WTO non-members, the application of these rates may be a requirement of a bilateral trade agreement.

“Products” means specified agricultural products under the three trade agreements (WTO, TDCA and AGOA).

“Permit fee” means the fee payable as prescribed by DAFF annually through the Government Gazette Notices.

“Utilization rate” means the actual usage of quota received

“Rate of duty” means tariff levied on importation of goods and services

“Rebate” means a partial refund to someone who has paid too much for tax, rent, or a utility.

“Tariff” means a tax imposed by government on goods or services which are imported into the country

“TDCA” is a trade agreement between South Africa and the EU whereby the EU has liberalized approximately 61% of agricultural imports from SA and granted tariff quotas

2015/16 ANNUAL REPORT ON THE PREFERENTIAL MARKET ACCESS PROGRAMME IN TERMS OF THE SA-EU TDCA, WTO AGREEMENT AND AGOA Page iii

for certain agricultural products at preferential tariff rates (ranging from 50% to 100% of MFN.

“Wine online system” is a web based system controlling the local export certification of liquor products; the system is governed and prescribed by the Liquor Products Act and the regulations pertaining to it.

“Quota” means a limited quantity of a particular product which under official control can be produced, exported, or imported.

2015/16 ANNUAL REPORT ON THE PREFERENTIAL MARKET ACCESS PROGRAMME IN TERMS OF THE SA-EU TDCA, WTO AGREEMENT AND AGOA Page iv

1. INTRODUCTION AND BACKGROUND

The Directorate Marketing is routinely involved in the administration and issuing of

negotiated market access import and export quotas and permits for a range of selected

agricultural products. The trade agreements which are involved for this preferential market

access programme are the South Africa – European Union (SA – EU) Trade,

Development and Cooperation Agreement (TDCA), World Trade Organisation (WTO)

Marrakech Agreement and the Africa Growth and Opportunity Act (AGOA). Importers in

South Africa pay a reduced rate of duty on certain selected products in terms of the WTO

and AGOA. On the export of certain products, the importers in the European Union (EU)

receive a rebate on the tariff rate. These enable exporters with quotas to export their

products at more favourable prices to EU countries. The objectives of these agreements

are to enhance trade between the countries and ensure increased market access to

importers and exporters.

1.1 SA – EU Trade, Development and Cooperation Agreement (TDCA)

The TDCA between the EU and South Africa has been established and entered into force

on 01 January 2000. This agreement provides for the establishment of a Free Trade Area

(FTA) between the EU and South Africa in accordance with the WTO rules and the

strengthening of EU development assistance to South Africa.

In terms of the Agreement the EU has undertaken to liberalise approximately 61% of

agricultural imports from South Africa and further granted tariff quotas for certain

agricultural products at preferential tariff rates, ranging from 50% to 100% of the Most

Favoured Nations (MFN) tariff. These quotas make up approximately 13% of agricultural

trade with the EU, implying that in total 74% of South African exports to the EU are subject

to some form of preferential trade access.

As part of the concessions provided for in terms of this agreement, tariff preferences were

granted on limited quantities of selected products in the form of tariff quotas. The

Department of Agriculture, Forestry and Fisheries (DAFF) administers the EU agricultural

quotas. Export permits are issued for the access quantities at reduced levels of duty

payable by the importers in the EU countries. Detailed information on the procedures

regarding applications for these quotas is published annually in a General Notice in the

2015/16 ANNUAL REPORT ON THE PREFERENTIAL MARKET ACCESS PROGRAMME IN TERMS OF THE SA-EU TDCA, WTO AGREEMENT AND AGOA Page 1

Government Gazette. The following table shows quota (volumes) and products which can

be exported to the EU under the agreement.

Table 1: Quota (volumes) and products exported under the SA-EU TDCA

Products Quota (Volumes) (Annual Tonnage)

Quota allocated(Tons)

Cut flowers 3 895 1 565

Frozen strawberries 377.5 0

Canned fruit (pears, apricots,

peaches, mixtures of fruit)

60 866 59 050

Canned Mixtures of fruit, other than

tropical fruit

27 102.4 20 000

Canned Mixtures of tropical fruit 2 960 0

Apple juice 3 700 1 950

Pineapple juice (concentrate) 3 700 3 000

Frozen orange juice 1 036 1 036

Products Volumes (Annual Litres) Quota allocated (Litres)

Wines of fresh grapes (sparkling wine, white wine, red wine)

49 067 000 49 067 000

Source: DAFF, Directorate Marketing

1.2 WTO Marrakech Agreement

In order to fulfil South Africa’s commitments under the WTO Marrakech Agreement

regarding market access, quotas are issued for various products that can be imported at

reduced rates of duty subject to an import permit. Detailed information regarding the

procedures for the submission of applications for these permits is published annually as a

General Notice in the Government Gazette. Applications are invited quarterly, half-yearly

and annually as stipulated in the Notice for the specified products. The following table

(table 2) shows quotas and products which can be imported under the WTO agreement.


Table 2: Quota (volumes) and products imported under the WTO Agreement

Products Volumes (Annual Tonnage) Quota allocated (Tons)

Dried beans 11 063 11063

Food preparations 3 109 3109

Malt extract 6 119 0

Pasta 1 749 1749

Wines and spirits 9 572 405 1 220 500

Dried vegetables 860 860

Frozen vegetables 583 583

Peas 263 0

Bird’s Eggs 9 000 0

Beef 26 254 26254

Mutton 6 002 6002

Dried fruits 349 339.5

Cotton 17 101 0

Tobacco 16 773 16773

Butter 1 167 1167

Butter milk 213 107

Whey 2 786 2186

Cheese and curd 1 989 1989

Buckwheat 145 0

Maize 269 000 269000

Wheat & Meslin 108 279 108279

Dried grapes 397 0

Dried chickpeas 5 184 0



1.3 Africa Growth and Opportunity Act (AGOA)

The South African and Unites States of America (USA) governments, in consultation with

the South African Poultry Association (SAPA) and the USA Poultry and Egg Export

Council (USAPEEC) and National Chicken Council (NCC) agreed on an annual quota of

65 000 metric tons (the quota) of bone-in chicken pieces, classifiable under tariff

subheading 0207.14.9, that can be imported into South Africa without payment of the

applicable anti-dumping duty as listed in Schedule 2, Part 1 to the Customs and Excise

Act, 1964. This was done to address the concerns raised by the USAPEEC and NCC and

the USA government during the Africa Growth and Opportunity Act (AGOA) renewal

process. To facilitate the implementation of the agreement, the Department of Trade and

Industry (the DTI), DAFF and the International Trade Administration Commission of South

Africa (ITAC) developed guidelines that were published for public comments on 30

October 2015 and finally gazetted by the DTI on 18 December 2015.

It was agreed that the government of South Africa will implement the agreement referred

to above through the creation of a Rebate Provision. It was further agreed that the quota

will increase with annual growth factor based on the annual average growth of production

and consumption figures of poultry meat as published by DAFF in March of each year.

The quota will be terminated or suspended if South Africa’s beneficiary status under

AGOA changes.

2. OBJECTIVES OF THE PREFERENTIAL MARKET ACCESS PROGRAMME

To enhance agricultural trade of goods and services between South Africa and the

rest of the world;

To ensure increased market access to South African importers and exporters;

To administer the allocation of quotas on three trade agreements through fair and

equitable allocation; and

To monitor the utilization of quotas under the three trade agreements and reallocate

where necessary.


3. APPLICATION PROCEDURE FOR THE PREFERENTIAL MARKET ACCESS PROGRAMME

The application processes under all agreements begins by invitations being forwarded to

all interested parties through the publication of a Government Notice in the form of a

Government Gazette. The gazette is published annually on the departmental website and

websites of various industry organizations after approval by the Director General. The

gazette outlines all the terms and conditions regarding the application process.

3.1 Eligibility

In order to be considered for an import/export permit by DAFF under the quota, an

applicant must:

Be a South African citizen with a valid identity document or a legal entity with a valid

certificate of registration/incorporation in South Africa;

Have a valid South African Revenue Service (SARS) tax clearance certificate

(failure to submit this will lead to disqualification);

Be registered at SARS as an importer/exporter;

Provide a valid BBBEE verification certificate from an accredited rating agency to

confirm BBBEE status;

Provide share certificates to confirm the HDI status in a business;

Complete and sign an application form and an affidavit; and

Provide proof of payment of the prescribed permit fee.

Both the SA – EU TDCA and WTO agreements have twenty percent of the quota reserved

for HDIs whereas the AGOA agreement has a minimum of fifty per cent of the quota

reserved for HDIs; in order to pursue the goals of transformation as enshrined in the Agri-

BEE sector code under section 9(1) of the BBBEE Act 53 of 2003 (as amended).

The quotas allocated to exporters are provisional; the department assesses on an annual

basis the utilization rate by the end of June after which there will be reallocation by the

end of September.


3.2 Method of allocation

Quotas are allocated taking into account the following variables:

The BBBEE status of applicants – obtainable from a BEE certificate issued by an

accredited verification agency;

The market share of applicants – derived from historical exports/imports data for the

past three years. This is not a requirement for HDIs;

Quota applied for by applicants;

Number of applicants; and

The total quota available.

3.3 Permit fee

The permit fee is determined in collaboration with the Directorate: Financial Services as

prescribed by the National Treasury regulations. The fees payable for the quota is

prescribed annually through the publication of the Government Gazette and in the

departmental tariff manual. The following variables are taken into consideration when

calculating the fee:

The direct costs which are the operational cost (letterheads, stationery, toners,

publication of the gazette etc.;

The indirect cost i.e. labour cost (salary, percentage of time spent, number of

personnel etc.); and

The number of permits issued for that particular year.

The current fee (for 2015/16) is R703.00 per permit. The revised fee for 2016/17 will be

R820.00 for a permit. Payments are made in a special standard bank account of the

department, at cashiers of the department and/or internet.

4. KEY DELIVERABLES FOR 2015/16

Notices relating to the allocation of the quotas for the 2015/16 period were published in

the Government Gazette number 39275 in October 2014 (for the TDCA and WTO

agreements). The department in collaboration with the DTI and ITAC published the

guidelines in December 2015 for the application for a quota under the AGOA agreement.


Notices relating to the allocation of the AGOA import quotas were published in the

Government Gazette number 39643 in January 2016 to invite all interested parties to

submit their applications for import permits. Tables 3 to 8 underneath illustrate the

summary of the quota allocation under the WTO, TDCA and AGOA Agreements in

2015/16.

Table 3: Quota allocations for products imported quarterly under the WTO Agreement

Products Total number of applicants in 2015/16

Number of permits issued Number of disqualified applications

Period Q11 Q22 Q33 Q44 Total Q1 Q2 Q3 Q4 Total

Beef 14 13 17 15 59 14 13 17 15 59 0

Mutton 12 12 15 14 53 12 12 15 14 53 0

Dried beans

19 19 23 23 84 19 19 23 23 84 0

Pasta 9 8 10 10 37 9 8 10 10 37 0

Food preparation

10 15 17 12 54 10 15 17 12 54 0

Total 64 65 82 74 285 64 65 82 74 285 0


Table 3 illustrates the results of import quota for various products allocated on quarterly basis during 2015/16. The first quarter was characterized by low number of applications as compared to other quarters. The highest number of applications was recorded during quarter three (Q3). The high number of importers in Q3 and Q4 is primarily due to the end of the year increase in demand for various agricultural products by the local market. Overall, dried beans quota received the largest number of applications followed by the beef quota both recording 84 and 54 applications respectively. The least number of quota applications received were for pasta recording 37 applications. All applicants complied with all application requirements hence none of the applications were disqualified. Figure 1 below clearly shows the trend in the number of application received during 2015/16, for the products under the WTO agreement.

1 Q1 refers to a period from January to April2 Q2 refers to a period from April to July3 Q3 refers to a period from July to October4 Q4 refers to a period from October to January


Q1 Q2 Q3 Q40

5

10

15

20

25

Figure 1: Number of applications received in 2015/16 per quarter

Beef Mutton Dried beans Pasta Food preparation

Period (Quarters)

Num

ber o

f app

licat

ions


Table 4: Quota allocations for products imported on a semester basis under the WTO Agreement



Period Semester5 1

Semester6 2

Total Semester 1

Semester 2

Total

Butter 3 5 8 3 5 8 0

Milk 2 1 3 2 1 3 0

Wines of fresh grapes

7 6 13 7 6 13 0

Dried fruits 1 1 2 1 1 2 0

Frozen vegetables

2 1 3 2 1 3 0

5 Semester 1 refers to a period from January to July6 Semester 2 refers to a period from July to December




Period Semester 1

Semester 2

Total Semester 1

Semester 2

Total

Dried vegetables

2 2 4 2 2 4 0

Cheese 2 4 6 2 4 6 0

Total 19 20 39 19 20 39 0

Source: DAFF, Directorate Marketing.

Table 4 illustrates the results of import quota allocations for various products on semester

basis. The second semester of the year 2015 received more applications as compared to

the first semester. Wines of fresh grapes had the largest number of permits issued

recording 7 and 6 in both semesters respectively. The least number of permits issued was

for dried fruits. The total number of applications received for 2015/16 was 39. All

applicants complied with application requirements hence none of the applications were

disqualified.

Table 5: Quota allocations for products imported annually under the WTO Agreement

Products Total number. of applicants in

2015/16

Number of permits issued

Number of disqualified applications

Wheat 4 4 0

Maize 7 7 0

Tobacco 4 4 0

Total 15 15 0


Table 5 illustrates quota allocation results for various products imported annually under

the WTO Agreement. The total number of applications received was 15. With 4 permits

issued for wheat imports, 7 for maize imports and 4 for tobacco imports. All companies

that applied were issued permits and none was disqualified.

Table 6: Quota allocations for products exported under the SA–EU TDCA


Products Total number. of applicants 2015/2016



Canned Pears, Apricots and Peaches not containing added spirit

4 4 0

Canned Mixtures of fruit, other than tropical fruit

2 2 0

Canned Mixtures of tropical fruit

0 0 0

Frozen orange juice 1 1 0

Pineapple juice (concentrate)

1 1 0

Apple juice 3 3 0

Wines of fresh grapes (sparkling wine, white wine, red wine)

305 286 19

Total 316 297 19


According to table 6, there were only 4 applications received for canned pears, apricots

and peaches (not containing added spirit) and all applicants were issued with quotas and

permits during 2015/16. Only 2 applications were received for canned mixtures of fruit

(other than tropical fruit). Frozen orange juice and pineapple juice received only 1

application respectively and all were issued with permits. There were 305 applications

received for the wine export quota. However, only 286 permits were issued with 19

applications being disqualified due to the applicants’ inability to submit valid SARS tax

clearance certificates.


Table 7: Companies that participated in the AGOA poultry meat import scheme.

COMPANY (ESTABLISHED

IMPORTERS)CUSTOMS

CODEBEE

LEVEL

APPLIED QUOTA (TONS)

FINAL ALLOCATED QUOTA (TONS)

South Atlantic Meat Import and Export (Pty) Ltd 01484506 8 1000 588Etlin International (Pty) Ltd 816622 4 16250 1805Excellent Meat International Trading (Pty) Ltd

1409927 4 3000 579

Britos Meat (Pty) Ltd 879653 7 7500 387Humeat Import and Export (Pty) Ltd 21360625 8 8125 714Shoprite Checkers (Pty) Ltd 00523473 4 4050 499

Merger Meats (Pty) Ltd 21486863Non-

Compliant 243 61Deep Catch Trading (Pty) Ltd 20572694

Non-Compliant 924 45

Federated Meats (Pty) Ltd 01699216Non-

Compliant 2160 484

Koo Koo Roo Chickens cc 20150612Non-

Compliant 5000 118Assign Trading cc 21237444 4 1080 532Chester Wholesale Meat (KZN) (Pty) Ltd 1716354 8 65000 205Weddelswift South Africa (Pty) Ltd 20652915


QK Meats (Pty) Ltd 20359927 6 165 165Dawn Farm Foods (Pty) Ltd 20466810


Dee Import and Export (Pty) Ltd 20128008


Merlog Foods (Pty) Ltd 1237254 7 16250 969

Rib Zone (Pty) Ltd 21277884Non-

Compliant 2000 111Capricon Cold Storage (Pty) Ltd 20815808


Afgri Poultry (Pty) Ltd t/a Daybreak Farm 21473436 2 16250 491

HISTORICAL DISADVANTAGED

INDIVIDUALS (HDIs)CUSTOMS

CODEBEE

LEVEL



Dini Lesizwe (Pty) Ltd 3 2000 1025Humbulani Albert Mulibana (Kwendo Logistics) 21579675 3 6000 1025PSJ 976 (Pty) Ltd 21577559 1 648 648Luthuli Trading House (Pty) Ltd 2 1080 1025

HISTORICAL DISADVANTAGED

INDIVIDUALS (HDIs)CUSTOMS

CODEBEE

LEVEL


FINAL ALLOCATED

QUOTA (TONS)


Ubuntu Food Traders (Pty) Ltd 21599089 1 1500 1025ZCM Investment (Pty) Ltd 21584864 2 300 300Mega Foods Supplies (Pty) Ltd 21599232 2 5000 1025Thintani (Pty) Ltd 20401652 1 2800 1025Radisol Group (Pty) Ltd 21537786 1 3000 1025

DISQUALIFIED COMPANIES

CUSTOMS CODE

BEE LEVEL



Millennium Meat Import and Export (Pty)Ltd 20968021


Liphumile Agencies (Pty) Ltd 27 0Hume South Africa (Pty) Ltd 21587200 3 8125 0Source: DAFF, Directorate Marketing

Tables 7 and 8 indicate that there were 32 applications received for the chicken quota to

be imported from the USA. However, only 29 permits were issued with 3 applications

being disqualified.

Table 8: Quota allocations for products imported under the AGOA agreement

Products Total number of applicants for Q17 of 2016/17



Frozen meat of the species Gallus domesticus, cut in pieces with bone in, classifiable in tariff subheading 0207.14.9 (Chicken)

32 29 3


Four applicants that were disqualified received letters from the department notifying them

of the outcome of their applications. The following provides a summary of the

disqualifications:

Millennium Meat Import and Export (Pty) Ltd was disqualified due to the applicant’s

failure to submit SARS tax clearance certificate. The Government Gazette number

39643 clearly indicated that failure to submit SARS tax clearance certificate result

7 Q1 refers to a period from April-June


in automatic disqualification of the application. However prior to the application

disqualification, numerous attempts were made by the department to remind the

applicant to submit valid SARS tax clearance certificate. The applicant was

encouraged to sort out all issues regarding SARS paperwork in advance in order

to participate in the Preferential Market Access Programme in the next round of

allocation period.

Liphumile Agencies (Pty) Ltd is disqualification was due to failure to provide proof

of payment of the prescribed permit fee. The Government Gazette clearly states

that the permit fee of R820.00 should accompany the application and failure to

adhere to this requirement will result in automatic disqualification. However, prior

to the disqualification, numerous reminders informing the applicant to submit the

proof of payment were made by the department. The applicant was encouraged to

make payment and attach the proof of payment (bank deposit slip or cashier

receipt) in the application form in order for the company to meet all the

requirements as stipulated in the Government Gazette number 39643 in the next

round of allocations.

Hume South Africa (Pty) Ltd’s application was disqualified due to inconsistencies

in the information provided to substantiate its HDI status. Numerous attempts were

made to request the applicant to furnish the department with the requested

information however; the documents provided could not be corroborated with the

supporting evidence.

5. ANALYSIS OF FILL RATES

5.1 SA-EU TDCA export quota utilization

Table 9: TDCA export quota utilization in 2015/16

Product

Allocated quota (tons)

Utilized quota (tons)

Remaining quota (tons)

Percentage (%) use of

quotaStrawberries, Frozen 363 0 363 0Canned Pears, Apricots and Peaches not containing added spirit 59 629 33 511 26 118 56.2Canned Mixtures of fruit, other than tropical fruit 26 552 2 336 24 216 8.8Canned Mixtures of tropical 2 900 0 2 900 0


Product

Allocated quota (tons)

Utilized quota (tons)

Remaining quota (tons)


quotafruitsFrozen orange juice 1 015 1 015 0 100Pineapple juice (concentrate) 7 250 551 6 699 7.6Source: EC Taric website (http://ec.europa.eu/taxation_customs )

Product

Allocated quota (litres)

Utilized quota (litres)

Remaining quota (litres)


quotaWines of fresh grapes (sparkling wine, white wine, red wine) 49 067 000 42 344 821 6 722 179 86.3Source: EC Taric website (http://ec.europa.eu/taxation_customs )

According to table 9, wines of fresh grapes were by far the major product under the TDCA

export quota agreement with the allocation of just under 49 million liters. It is important to

note that only 86% of the wines of fresh grapes export quota were utilized by the end of

2015. The frozen orange juice export quota was fully used while the utilization of

pineapple juice export quota amounted to 7.6%. The export quota available for frozen

strawberries during 2015 was 363 tons however none of the export quota was used as

there were no applications for this product. The same occurred for canned mixtures of

tropical fruits. The quota utilization for canned pears, apricots and peaches (not containing

added spirit) amounted to 56.2% while that of canned mixtures of fruit, (other than tropical

fruit) amounted to 8.8%.

It can be inferred from table 9 that the export quotas for most products are underutilized

and the department is constantly communicating with industry associations such as the

South African Fruit & Vegetable Canners' Association (SAFVCA) representing the fruit

and vegetable canning industry members and Wines of South Africa (WOSA) representing

wine traders to alert them of the fill rates so that they disseminate the information to their

members.

The department during 2015 continued to monitor the utilization of the wine export quota

on a regular basis by identifying individual exporters who underutilized their allocated

quota and timeously reallocating when necessary through the Wine-on-line system and

the Joint Wine Monitoring committee comprising the DAFF, SARS and the wine industry

represented by WOSA.


http://ec.europa.eu/taxation_customs


2010 2011 2012 2013 2014 20150

10

20

30

40

50

60

70

80

90

100

Figure 2: SA-EU Trade, Development and Cooperation Agreement (TDCA) Export Quota Utilization

Period (Years)

Expo

rts Q

uota

Util

izatio

n (%

)

Source: EC Taric website (http://ec.europa.eu/taxation_customs)

The above figure illustrates the fill rates (in percentages) over the past six years for

products exported under the TDCA that are administered by the department. It is clear

from the figure that over the past six years more than fifty percent of the quota is used in

all products except for frozen strawberries, canned mixture of fruit (other than tropical)

and canned mixtures of tropical fruit. It can be observed that throughout the period under

analysis both frozen strawberries and canned mixture of tropical fruits recorded 0%

utilization of quota. This was as result of not receiving applications for these products. The

utilization of the quota for canned pears, apricots and peaches (not containing added

spirit) has been declining over the past six years. The same can also be said for Canned

Mixtures of fruit (other than tropical fruits). Furthermore, in the past three years from 2013,

2014 and 2015 the export quota for frozen orange juice has been fully utilised. It is also

clear from the figure that wine export quota utilization increased by 4% in 2015 as

compared to 2014.



6. CHALLENGES

Occasionally applicants send incomplete applications which then pose a challenge when

allocation processes begin. However the department constantly ensures that before the

allocation process start, it informs all those that have submitted application forms with

outstanding documents in time and they are given an opportunity to provide required

supporting documents.

Under the TDCA agreement, it appears that there is constant underutilization of the export

quota for certain products such as frozen strawberries and canned mixtures of fruits.

However the department is continuously in contact with relevant industry organisations in

an effort to inform the members & create awareness.

Currently there is no system in place to assess the fill rate for products imported under

WTO and AGOA agreements. However, the directorate has established a working

relationship with SARS in order to gain access to individual company trade data, which will

enable the directorate to continually assess the fill rates of products imported under all

three trade agreements. SARS has consequently advised the department to communicate

to the Commissioner through the Director General to request access to trade statistics of

companies benefiting from the preferential market access programme.

…………………………………………………………

Name: H.M Mamabolo

Designation: Director: Marketing

Date:


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