Martina speaks at the “Workshop on e-commerce in Africa: key policy issues and priority research questions” in Pretoria in January 2017.

1. D I G I TA L T R A D E
R E S T R I C T I O N S I N
S O U T H A F R I C A
M A R T I N A F. F E R R A C A N E
R E S E A R C H A S S O C I A T E A T E C I P E
R O U N D TA B L E D I S C U S S I O N : E - C O M M E R C E I N A F R I C A
3 1 J A N U A RY 2 0 1 7

2. D E F I N I T I O N A L I S S U E S
- “An e-commerce transaction is the sale or purchase of goods
or services, conducted over computer networks by methods
specifically designed for the purpose of receiving or placing
of orders.“ - UNCTAD
- “Cross-border provision of goods, products, services and
solutions that are instrumental to or avail themselves of
internet connectivity.”- Huawei
E - C O M M E R C E :
D I G I TA L T R A D E :

3. D I G I TA L T R A D E E S T I M A T E S :
T H E D A TA B A S E
13 main areas:
1. Tariffs and trade defence
2. Taxation and subsidies
3. Public procurement
4. Foreign investment
5. IPR
6. Competition policy
7. Business mobility
8. Data policies
9. Intermediary liability
10. Content access
11. Quantitative trade restrictions
12. Standards
13. Online sales and transactions

4. 1. Applied tariffs on digital goods
2. Antidumping, CVD & Safeguards on digital goods
C H A P T E R 1 :
TA R I F F S A N D T R A D E D E F E N C E

5. Digital goods : ICT products beyond the list agreed in the ITA agreements.
C H A P T E R 1 :
TA R I F F S A N D T R A D E D E F E N C E
South Africa is not a signatory of the 1996 WTO
Information Technology Agreement (ITA) !!!

6. C H A P T E R 2 :
TA X A T I O N A N D S U B S I D I E S
1. Discriminatory tax regime on digital goods and products
2. Discriminatory tax regime on online services
3. Taxation on data usage
4. Subsidies and discriminatory tax regime

7. Foreign e-commerce suppliers and foreign businesses
supplying eBooks, music and other digital services (e.g.
apps, digital books, online memberships, gaming online,
streaming movies, music downloads) are required to
register as Value Added Tax (VAT) vendors for business to
consumer operations.
C H A P T E R 2 :
TA X A T I O N A N D S U B S I D I E S
Moreover, the VAT registration threshold for foreign
companies (taxable yearly turnover exceeding ZAR 50,000
(approx. USD 3,500) is lower than that for domestic
companies (ZAR 1 million (approx. USD 100,000)).

8. C H A P T E R 2 :
TA X A T I O N A N D S U B S I D I E S
In the 2015 National Budget Speech, it was announced
that the electronic services provisions would be
amended to include the supply of software within its
scope. This announcement signals a departure from the
strict focus on business to consumer operations and the
first steps towards the taxation of online services which
are provided in business to business operations.

9. C H A P T E R 3 :
P U B L I C P R O C U R E M E N T
1. Preferential purchase schemes covering ICT products, services
2. Surrendering of patents, source code etc.
3. Technology mandate (encryption, formats)

10. C H A P T E R 3 :
P U B L I C P R O C U R E M E N T
In the case of designated sectors where local production
and content is deemed “of critical importance”, the
tendering procedure must be restricted to locally
produced goods, services or works only. As of April 2014,
these designated sectors include set-top boxes for
digital TV and telecom cables.

11. C H A P T E R 3 :
P U B L I C P R O C U R E M E N T
South Africa is not a party to the WTO Agreement on
Government Procurement.

12. C H A P T E R 4 . F O R E I G N I N V E S T M E N T
1. Restrictions on ownership
2. Restrictions on board of directors and managers
3. Screening and restrictions on cross-border mergers
and acquisitions
1. Patents
2. Copyright
3. Trade secrets
C H A P T E R 5 . I N T E L L E C T U A L P R O P E R T Y R I G H T S

13. The Copyright Act provides for a copyright exception
based on the notion of fair dealing. When the source as
well as the name of the author are mentioned, literary or
musical work can be used for the purposes of research,
private study, criticism, review and reporting current
events.
C H A P T E R 5 :
I N T E L L E C T U A L P R O P E R T Y R I G H T S

14. M A I N A R E A S :
6 . C O M P E T I T I O N P O L I C Y
Mainly related to the
telecom sector….

15. M A I N A R E A S :
6 . C O M P E T I T I O N P O L I C Y
Despite deregulation in February 2005, it is reported that
local loop unboundling has not been implemented.

16. M A I N A R E A S :
6 . C O M P E T I T I O N P O L I C Y
Telkom, the telecommunications incumbent in South
Africa, is 51% state-owned.

17. M A I N A R E A S :
6 . C O M P E T I T I O N P O L I C Y
It is reported that several factors limite competition and
the effects of liberalisation in the South Africa
telecommunications market. These include:
interconnection, tariff regulation, access to scarce
resources and anti-competitive practices.
In 2013, Orange (France) complained that mobile
termination rates in South Africa were very high and that
the wholesale prices are not capped by the regulator.

18. M A I N A R E A S :
7 . B U S I N E S S M O B I L I T Y
Measures include quotas, labour
market regulations and limits of stay,
inter alia.

19. M A I N A R E A S :
8 . D A TA P O L I C I E S
1. Restrictions cross-border on data flows (data localisation)
2. Data retention
3. Subject rights on data privacy
4. Administrative requirements on data privacy
5. Sanctions for non-compliance

20. M A I N A R E A S :
8 . D A TA P O L I C I E S
Consent is needed for the data transfer to third countries.
Otherwise, the transfer can happen if:
- the third party is subject to a law, binding corporate rules or
binding agreement that provide for an adequate level of protection;
- the transfer is necessary for the performance of a contract between
the data subject and the responsible party, or
- the transfer is necessary for the implementation of pre-contractual
measures taken in response to the data subject's request.

21. Source: ECIPE Digital Trade Estimates database. Available at www.ecipe.org/dte/database
Note: The graph does not include one measure whose date of entry into force is unknown.
0"
10"
20"
30"
40"
50"
60"
70"
80"
90"
1960" 1965" 1970" 1975" 1980" 1985" 1990" 1995" 2000" 2005" 2010" 2015"
The$evolu)on$of$data$localisa)on$measures$
F E W W O R D S O N D A TA L O C A L I S A T I O N

24. M A I N A R E A S :
9 . I N T E R M E D I A RY L I A B I L I T Y
1. Framework that provides a safe harbor
2. Notice and takedown requirement
1 0 . C O N T E N T A C C E S S
1. Censorship, filtering
2. Bandwidth, net neutrality

25. M A I N A R E A S :
9 . I N T E R M E D I A RY L I A B I L I T Y
The most distinctive feature of South African safe harbor
regime for intermediaries is the conditioning of any
liability limitation to the membership of an industry
representative body recognised by the Minister of
Communications. Membership is subject to specific
criteria, which are reported to be quite lengthy and
burdensome. At the same time, the representative body
should assess compliance over all members.

26. M A I N A R E A S :
1 1 . Q U A N T I TA T I V E T R A D E R E S T R I C T I O N S
1. Import restrictions
2. Local Content Requirements for commercial market
3. Export restrictions

27. M A I N A R E A S :
1 2 . S TA N D A R D S
1. Telecom network and base standards (Non-international
broadband, mobile, and ICT product standards)
2. Product safety certification (EMC/EMI, radio transmission)
3. Product screening and testing requirements
4. Encryption

28. M A I N A R E A S :
1 2 . S TA N D A R D S
South Africa's National Regulator for Compulsory
Specifications (NRCS) requires a Letter of Authority for product
safety and Certificate of Conformity for Electromagnetic
Compatibility for some telecommunications equipment, some
radio equipment and information technology equipment.
Approval is typically issued based on foreign standard test
reports that demonstrate compliance with South African
technical standards.Telecommunication line terminal
equipment (TLTE) is subject to type approval by ICASA (the
regulator for the South African communications sector.)

29. M A I N A R E A S :
1 3 . O N L I N E S A L E S A N D T R A N S A C T I O N S
1. Barriers to fulfilment
2. Domain name (DNS) registration requirements
3. Ban to online sales
4. Discriminatory/disproportionate consumer protection

30. M A I N A R E A S :
1 3 . O N L I N E S A L E S A N D T R A N S A C T I O N S
South Africa has no de minimis rule, which means that
there is no minimum value of a good below which the
good is exempted from duties and taxes collected by
the customs.

31. W W W. E C I P E . O R G / D T E
M A R T I N A F R A N C E S C A F E R R A C A N E
E M A I L : M A R T I N A . F E R R A C A N E @ E C I P E . O R G
THANK YOU!