Trump to review SA’s tax-free trade

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The tax-free import of certain South African products to the US will be reviewed because of concerns over the controversial Copyright Amendment Bill.

The bill is currently under pres. Cyril Ramaphosa to sign it after Parliament accepted it.

The US Trade Representative’s Office said in a statement on Friday. Donald Trump has suspended roughly R19 billion ($ 1.3 billion) of preference enjoyed by Thailand under its Generalized System of Preferences (GSP). This is because this country fails to protect internationally recognized workers’ rights.

At the same time, the office announced Trump was recovering some of Ukraine’s benefits after the country passed legislation addressing flaws in its regime to protect intellectual property rights.

According to this statement, South Africa’s eligibility for preferential trade will be reviewed because of the country’s protection of intellectual property.

America uses preferential programs to help developing countries in particular gain better access to its market.

One of the oldest preferred systems is the GSP which was started in 1976. The GSP program provides for the tax-free import of designated items when imported from the beneficiary countries.

A preferred program that is better known to South Africans is the Growth and Opportunities Act in Africa (Agoa), which came into force in 2000 and allows tax-free imports from certain African countries.

According to the Office of the Trade Representative, a petition has been accepted by the International Intellectual Property Alliance (IIPA) printing group expressing concern about whether South Africa fully complies with the GSP intellectual property rights criteria for copyright protection. Read who the IIPA is. 

A notice was issued in June requesting comment on the annual review of the GSP beneficiaries.

Another notice will be issued on public hearings and the time allowed for comment on the review of the countries eligible for GSP.

Under the GSP program, 3 500 products can be imported tax-free from the 119 countries that receive preferential treatment. To be eligible, the beneficiary countries must meet 15 criteria, including steps to protect internationally recognized labor rights, adequately and effectively protect property rights, and provide fair and reasonable access to their markets.

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