Expiration of rebate certificates issued under rebate item 412 for critical supplies
By Tabacks Cpmmercial Team
The South African government has made commendable efforts to ensure a continued supply of critical medical equipment. One of the measures introduced by the International Trade Administration Commission (ITAC) provides for a full rebate of customs duties on critical supplies imported for the “the relief of distress of persons” under rebate item 412.11 during the national state of disaster. Upon issuing these rebate certificates, ITAC imposed particular conditions, including, inter alia, that the certificate would be valid for the clearance of eligible products until 31 May 2020.
This rebate programme was introduced with the purposes of combatting the spread of COVID-19 by ensuring that South Africa is able to maintain a continued source of critical medical supplies through incentivising imports. At present ITAC has made a determination, based on the information available to them, that there is no signal that there is (or will be) a shortage of these supplies.
The Department of Trade and industry has submitted that, at a policy level, custom duties are in place for the purposes of protecting domestic producers. The introduction of the lockdown to combat the spread of COVID-19 has undeniably diminished the rate of South Africa’s domestic economic activity, and thus extending the rebate programme for duty-free importation of these critical supplies would be detrimental for local manufacturing. Consequently, ITAC has issued a notice that rebate certificates issued by ITAC will not be extended or renewed after 31 May 2020 and any portion of the quota allocated in these certificates, which remains unused after the expiry date will be forfeited. In addition, no new rebate certificates will be issued after 31 May 2020.