Farms that are “too white” will no longer be allowed to export to the UK and the EU.
This comes after government quietly published new rules in the Government Gazette, in terms of which farmers must meet black economic empowerment (BEE) requirements in order to obtain export permits for Europe.
Only agricultural businesses with an annual turnover of less than R10 million are exempt from the requirements, but there are few export farmers who produce on such a small scale and fall below that threshold.
For other farmers, the regulations state:
A qualifying small enterprise (QSE) is one with an annual turnover of between R10 million and R50 million and qualifies for BEE recognition levels 1 or 2 (as defined in the amended AgriBEE sector code). QSEs which are at least 100% or 51% black-owned must use a BEE sworn affidavit template available on the department of trade, industry and competition website or a Companies and Intellectual Property Commission (CIPC) certificate on an annual basis. However, a QSE which is less than 51% black-owned must undergo BEE verification with an accredited SA National Accreditation System (Sanas) verification agency and comply with five of the elements of the AgriBEE sector code for the purpose of measurement.
This certificate must accompany the application form; and
A large enterprise is one with an annual turnover exceeding R50 million, regardless of the percentage of its black ownership. The enterprise must undergo BEE verification with an accredited Sanas BEE verification agency to obtain a valid BEE certificate. This certificate must accompany the application form;
The DA and farmers’ organisation Saai say the new obligation will deal a serious blow to investor security, job creation and growth in the agricultural sector.
For that reason, the DA has already lodged a complaint with the trade offices of the EU and the UK.
The department of agriculture, land reform and rural development published the new rules on the export of agricultural products to the EU and the UK in the Government Gazette on October 31 and November 1.
AFFECTED PRODUCE
Milk, cream, butter, fruit, nuts, sugar, jam, fruit purée, fruit juices, yeast, table grapes and wine are among the products affected, according to the notice.
South Africa’s agricultural exports amounted to around R240 billion last year. Of this, 20% was to the EU and 4% to the UK.
Applicants for export permits must comply with both the BEE Empowerment Act and the AgriBEE sector code, the announcement in gazette stated.
Noko Masipa, DA MP and party spokesperson for agriculture, says the new rules are “the bureaucratic equivalent of a pencil test on South African agricultural exporters”.
Last week, Masipa lodged a complaint with EU trade commissioner Valdis Dombrovskis and UK secretary for business and trade Kemi Badenoch. Masipa says:
The regulations violate the rules of fair trade that underpin South Africa’s agreements with the EU and the UK, both of which are explicitly premised upon protecting human rights, democratic principles and the rule of law
NEWS 24
