GUIDE TO: Trade agreements and certificates of origin
Trade agreements are when two or more nations agree on how they will work together to ensure mutual benefit in the field of trade. These agreements determine the tariffs (duties) countries impose on imports and exports.
Generally when there is a trade agreement in place goods move between those countries more easily and with less duties payable by the importer.
Exporters, in turn, can benefit from trade agreements by offering goods at a reduced rate of duty to buyers in the country of import. This ensures a competitive edge in the global market – so much so that your buyers may insist on this benefit.
So, whether you import or export, it is worthwhile knowing about and making use of these agreements where applicable.
To benefit from trade agreements as an importer:
1. Find out whether South Africa has a trade agreement that applies to your imports by consulting the table below.
2. Determine the rate of duty applicable to your goods under the relevant trade agreement by consulting our import duty directory.
3. Instruct your supplier to include the required certificate of origin with your import shipments. To find out which certificate you need, consult the table below. .
To benefit from trade agreements as an exporter:
1. Find out whether South Africa has trade agreements that apply to your exports by consulting the table below.
2. Register as a trader under the applicable trade agreements.
3. Include a Certificate of Origin with the shipment. To find out which certificate you need, consult the table below. To order certificates of origin for you exports, click here.
Consult the table below to find out which nations have trade agreements with South Africa.
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SOUTHERN AFRICAN CUSTOMS UNION (SACU)
COUNTRIES INVOLVED
South Africa, Botswana, Lesotho, Namibia and Eswatini
WHAT THIS MEANS FOR YOU
Duty free movement of goods between these countries. SACU is not a trade agreement, it is a Customs Union (trade bloc) which belongs to some of the below trade agreements as one common Customs controlled area.
Goods moving between countries that belong to SACU are not technically imported or exported because it stays within the same Customs controlled area. The goods must still be cleared through Customs for regulatory control and VAT purposes.
DUTY BENEFITS FOR: South African importers and exporters
CERTIFICATE OF ORIGIN REQUIRED: None
SOUTHERN AFRICA DEVELOPMENT COMMUNITY FREE TRADE AGREEMENT (SADC FTA)
COUNTRIES INVOLVED
16 SADC Member States:
Angola, Botswana, Comoros, Democratic Republic of Congo, Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Tanzania, Zambia and Zimbabwe
WHAT THIS MEANS FOR YOU
Free trade for 85% of goods. The remaining 15% of goods are on the “sensitive list” and may attract some import duty.
To qualify goods must adhere to the SADC rules of origin
DUTY BENEFITS FOR: South African importers and exporters
Preferential SADC import duty rates are listed in the South African tariff book under Schedule 1 Part 1’s SADC column. Use our import duty directory to learn more. Go to import duty directory
CERTIFICATE OF ORIGIN REQUIRED: SADC Certificate
SACU-EFTA FREE TRADE AGREEMENT
COUNTRIES INVOLVED
SACU (see above) and the European Free Trade Association (EFTA) which consists of:
Iceland, Liechtenstein, Norway and Switzerland
WHAT THIS MEANS FOR YOU
EFTA countries charge significantly reduced tariffs on SACU products making them good markets to branch into, depending on product demand.
To qualify goods must adhere to the EFTA rules of origin
DUTY BENEFITS FOR: South African importers and exporters
Preferential EFTA import duty rates are listed in the South African tariff book under Schedule 1 Part 1’s EFTA column. Use our import duty directory to learn more. Go to import duty directory
CERTIFICATE OF ORIGIN REQUIRED: EUR.1 Certificate
SADC-EU ECONOMIC PARTNERSHIP AGREEMENT (SADC-EU EPA)
COUNTRIES INVOLVED
SADC (see above) and the European Union (EU) which consists of:
Austria, Belgium, Bulgaria, Croatia, Cyprus, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Czech Republic, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden
WHAT THIS MEANS FOR YOU
Tariff benefit for import and export.
100% free access to the EU market for Botswana, Lesotho, Mozambique, Namibia, and Eswatini (with the exception of arms and munitions).
Full or partial removal of customs duties on 98.7% of South African imports to the EU; full or partial removal of customs duties on 86% of SACU imports to the EU; and full or partial removal of customs duties on 74% of Mozambican imports to the EU.
This EPA implements asymmetric liberalisation, which means that the SADC EPA states do not have to match the EU’s market openness levels, but can instead select to keep tariffs on products that are sensitive to international competition.
To qualify goods must adhere to the SADC-EU EPA Rules of Origin
The United Kingdom was part of this agreement, until the end of 2020 when it left the EU. The UK entered a rollover agreement with similar benefit for SACU and Mozambique – See SACUM-UK below.
DUTY BENEFITS FOR: South African importers and exporters
Preferential EFTA import duty rates are listed in the South African tariff book under Schedule 1 Part 1’s EFTA column. Use our import duty directory to learn more. Go to import duty directory
CERTIFICATE OF ORIGIN REQUIRED: EUR.1 Certificate
SACUM-UK ECONOMIC PARTNERSHIP AGREEMENT
REGISTRATION AS A SACUM-UK EXPORTER IS NOT YET AVAILABLE
COUNTRIES INVOLVED
United Kingdom Great Britain and Northern Ireland and SACUM.
SACUM consists of SACU and Mozambique
WHAT THIS MEANS FOR YOU
The SACUM-UK EPA was negotiated for the sake of continued trade with the United Kingdom post Brexit.
During the implementation period SADC-EU EPA preferential duty rates remain valid and SADC-EU EPA Rules of Origin apply.
DUTY BENEFITS FOR: South African importers and exporters
Preferential SACUM-UK import duty rates are listed in the South African tariff book under Schedule 1 Part 1’s EU column. Use our import duty directory to learn more. Go to import duty directory
CERTIFICATE OF ORIGIN REQUIRED: EUR.1 Certificate apply until a dedicated SACUM-UK certificate becomes available.
AFRICAN CONTINENTAL FREE TRADE AGREEMENT (AFCFTA)
REGISTRATION AS A AfCFTA EXPORTER IS NOT YET AVAILABLE
COUNTRIES INVOLVED
The 5 member of SACU and Benin, Burkina Faso, Burundi, Cabo Verde, Cameroon, Central African Republic, Chad, Congo Republic, Democratic Republic of Congo, Egypt, Equatorial Guinea, Gabon, Ghana, Guinea, Guinea Bissau, Ivory Coast, Kenya, Liberia, Madagascar, Malawi, Mali, Mauritania, Mauritius, Niger, Nigeria, Rwanda, São Tomé and Príncipe, Senegal, Seychelles, Sierra Leone, Sudan, The Gambia, Togo, Uganda, United Republic if Tanzania and Zambia
WHAT THIS MEANS FOR YOU
Not all nations who are part of AfCFTA have submitted preferential rates. Thus far the countries who South Africa can trade with under AfCFTA are:
• São Tomé and Príncipe
• Egypt
DUTY BENEFITS FOR: South African importers and exporters
Preferential AfCFTA import duty rates are listed in the South African tariff book under Schedule 1 Part 1’s AfCFTA column. Use our import duty directory to learn more. Go to import duty directory
CERTIFICATE OF ORIGIN REQUIRED: SADC Certificates apply until a dedicated AfCFTA certificate becomes available.
MERCOSUR-SACU PREFERENTIAL TRADE AGREEMENT (PTA)
COUNTRIES INVOLVED
SACU (see above) and the Mercado Común del Sur (Common Market of the South) – MERCOSUR which consists of:
Argentina, Brazil, Paraguay and Uruguay
WHAT THIS MEANS FOR YOU
Tariff reductions on selected goods traded with the strongest South American economies that form part of MERCOSUR.
DUTY BENEFITS FOR: South African importers and exporters
Preferential MERCOSUR import duty rates are listed in the South African tariff book under Schedule 1 Part 1’s MERCOSUR column. Use our import duty directory to learn more. Go to import duty directory
CERTIFICATE OF ORIGIN REQUIRED: Mercosur Certificate
GENERALISED SYSTEM OF PREFERENCES (GSP)
COUNTRIES INVOLVED
Offered to South Africa as developing country by*:
Norway, Russia, Turkey, The USA, Canada and Japan
*Click on countries to view qualifying commodity codes
WHAT THIS MEANS FOR YOU
Products from the developing countries qualify for preferential market access in the form of lower tariffs (and removal of tariffs in some cases) on two thirds of all product categories.
DUTY BENEFITS FOR: Benefit is for export only.
No preferential rates apply to the South African tariff book for imports.
CERTIFICATE OF ORIGIN REQUIRED: Form A Certificates. Except for Norway which has an online certification system.
AFRICA GROWTH AND OPPORTUNITY ACT (AGOA)
COUNTRIES INVOLVED
Granted by the US to approved Sub-Saharan African (SSA) countries
WHAT THIS MEANS FOR YOU
AGOA offer preferential access to the US market through lower tariffs or no tariffs on some products.
DUTY BENEFITS FOR: Benefit is for export only.
No preferential rates apply to the South African tariff book for imports.
CERTIFICATE OF ORIGIN REQUIRED: A visa stamp which is put on the invoice for the consignment or an AGOA certificate of origin which is required for textiles.
Certificates of Origin
A Certificate of Origin (CO) is an international trade document which confirms that the goods in the shipment are obtained, produced, manufactured or processed in a particular country. An item can qualify for a certificate of origin from a specific country if it is either:
Wholly obtained from that country – all components and manufacturing originate in that country.
Sufficiently processed in that country – the components may have been imported but sufficient processing/manufacturing was done to transform or add value to the components so that the final item may be regarded as originating from that country.
For South Africans, the most frequently used certificates of origin are the SADC certificate and the EUR.1 certificate. For the regions where these certificates are applicable please refer to the above table.
SADC Certificate of Origin
A SADC certificate may be obtained when:
1) components/parts and finished product is fully obtained in a SADC country and
2) if some of the components/materials were imported, a minimum of 35% of the value should have been added in the SADC country during the manufacturing process.
EUR 1 Certificate of Origin
A EUR1 certificate may be obtained when:
1) components/parts and finished product is fully obtained in a qualifying country and
2) in that case where some of the components/parts were imported, there must be ‘sufficient processing’. For trade agreements that use Eur.1 certificates this generally means that the components/parts used must change tariff heading during the manufacturing process.
A tariff heading refers to the first four digits of a tariff code:
In conclusion: Making use of trade agreements may lower your tax rate or even reduce it to zero.
Be sure to have the sufficient documentation before importing or exporting. One of the most important documents you will need to make use of these trade agreements is your certificate of origin. To obtain a certificate of origin your product needs to be ‘wholly obtained’ or ‘sufficiently processed’ in the country from which you are applying for the certificate of origin.
To learn more about trade agreements, as well as the duties and taxes regarding import and export, we recommend signing up for the below online course.
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