LETTER: All eyes on Sars after ruling over frozen chicken tariffs
Arbitration panel favours the EU in a dispute with the Southern African Customs Union over a safeguard
09 August 2022 - 17:48
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An arbitration panel ruled last week in favour of the EU in a bilateral dispute with the Southern African Customs Union (Sacu) under the EU-Sadc Economic Partnership Agreement (EPA), over a safeguard measure imposed by Sacu on imports of frozen chicken cuts.
The panel’s report reads that the safeguard measures (punitive tariffs) affected €183m worth of EU exports (at the current exchange rate of R17 to the euro this equates to an astonishing R2.9bn). The panel found that the safeguard was not proportionate and way beyond what was needed to remedy or prevent any serious injury or disturbances.
Moreover, the delay between the investigation and the imposition of safeguard measures was excessive, and not in compliance with the EPA. It did not comply with the legal requirements set out in the agreement and was thus illegal. This is the first time yet that the EU has taken this extreme step in any of its many EPA agreements.
The safeguard measures were in effect from 2018 to 2022. Being illegal, payments in terms of these measures are likely to have to be repaid. If the SA Revenue Service (Sars) declines it would be no surprise if the matter ends up in court.
Over the last decade poultry disputes were referred to the high court, the World Trade Organization (WTO) or an independent arbitration panel three times, and in all three cases the locals lost.
In the light of the WTO and arbitration findings, one can only speculate how many other tariff decisions in many different industries would have been overruled by a higher authority had they been referred. The International Trade Administration Commission of SA is, after all, an arm of the government that openly aligns itself with government trade policies.
David Wolpert Rivonia
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
LETTER: All eyes on Sars after ruling over frozen chicken tariffs
Arbitration panel favours the EU in a dispute with the Southern African Customs Union over a safeguard
An arbitration panel ruled last week in favour of the EU in a bilateral dispute with the Southern African Customs Union (Sacu) under the EU-Sadc Economic Partnership Agreement (EPA), over a safeguard measure imposed by Sacu on imports of frozen chicken cuts.
The panel’s report reads that the safeguard measures (punitive tariffs) affected €183m worth of EU exports (at the current exchange rate of R17 to the euro this equates to an astonishing R2.9bn). The panel found that the safeguard was not proportionate and way beyond what was needed to remedy or prevent any serious injury or disturbances.
Moreover, the delay between the investigation and the imposition of safeguard measures was excessive, and not in compliance with the EPA. It did not comply with the legal requirements set out in the agreement and was thus illegal. This is the first time yet that the EU has taken this extreme step in any of its many EPA agreements.
The safeguard measures were in effect from 2018 to 2022. Being illegal, payments in terms of these measures are likely to have to be repaid. If the SA Revenue Service (Sars) declines it would be no surprise if the matter ends up in court.
Over the last decade poultry disputes were referred to the high court, the World Trade Organization (WTO) or an independent arbitration panel three times, and in all three cases the locals lost.
In the light of the WTO and arbitration findings, one can only speculate how many other tariff decisions in many different industries would have been overruled by a higher authority had they been referred. The International Trade Administration Commission of SA is, after all, an arm of the government that openly aligns itself with government trade policies.
David Wolpert
Rivonia
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
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