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Policy Directive on the Exportation of Scrap Metal Extended

March 23, 2020

Department of Trade and Industry

The Policy Directive on the Exportation of Ferrous and Non-Ferrous Waste and Scrap Metal has been extended.

The trade and industry department published notification of the extension in Government Gazette 43123.

Comment on the proposed extension was called for in February 2020.

The Policy Directive limiting the export of ferrous and non-ferrous scrap metal came into force in 2013.

It set out the policy in terms of which the International Trade Administration Commission (ITAC) was to exercise its powers under the ITA Act in administering the exportation of ferrous and non-ferrous waste and scrap metal.

ITAC subsequently issued export control guidelines.

The guidelines put in place a price preference system to assist domestic users, processors and recyclers to purchase scrap metal at a preference price for local consumption before the metal is exported.

The guidelines also contained substantiated proposals on what the price percentage lower than the Metal Bulletin price as determined in Rotterdam should be.

Local foundries, mills and smelters of scrap metal are given first option to buy the scrap at the preferred price for which an export permit has been applied for.

If no interest is shown in the metal by local operators within 30 days, then the exporter is able to continue with the export plans.

The price preference system is managed by the ITAC.

In September 2018, the Policy Directive was renewed for nine months until 30 June 2019.

The Amended Export Control Guidelines were also extended in the same month.

Last year the Policy Directive was extended for a further nine months until 31 March 2020.

According to the earlier notice for comment, the extension was sought so that the department, together with national treasury and the trade and industry department, could “explore the introduction of an export tax on ferrous and non-ferrous waste and scrap metal and its implications for the Directive”.

In Budget 2019, the finance minister, Tito Mboweni, announced that the introduction of an export tax on scrap metal was under consideration.

In the latest call for comment, the proposal to extend the Policy Directive was to enable treasury and the trade, industry and competition department to finalise the implementation of an export tax.

The Policy Directive has been extended from 31 March 2020 until 31 December 2020.

Meanwhile, in Gazette 43110, the economic development department published amendments to the conditions of exemption granted by the Competition Commission to the National Hospital Network (NHN).

The exemption was granted for five years commencing on 1 November 2018 and ending on 31 October 2023.

Last year, the NHN filed an application with the Commission requesting an extension or waiver of Clause 1 of the conditions dealing with the exclusion of members who do not meet the legislative criteria “Grace Period Condition” in order to allow for sufficient time to become compliant.

The Commission has extended the duration of clause 1 to 31 October 2021.

In Notice 181, the trade and industry department published two customs tariff applications to the International Trade Administration Commission.

One deals with an application by Columbus Stainless Steel (Pty) Ltd to increase the rate of customs duty on stainless steel flat products to counter projected low price imports into the Southern African Customs Union.

Representation is invited within four weeks of the date of publication.

The second focuses on an application by Luomo Atlantis Manufacturing (Pty) Ltd to create rebate facilities on woven fabrics of polyester fibres and cotton as the 22% ad valorem customs duty renders the end-products uncompetitive.

Representation is invited within seven working days of the date of publication.