Pretoria: The publication of the Block Exemption for Promotion of Exports, enabling South African exporters to collaborate in pursuing international markets, will not benefit them unless they make full use of the regulation.
According to South African Government News Agency, this was conveyed by Kwanele Mkhwanazi, the Director of Export Development and Support at the Department of Trade, Industry and Competition (the dtic), during a webinar on the Block Exemption for Promotion of Exports, co-hosted by the dtic and the Competition Commission of South Africa (CCSA). The Block Exemption, promulgated by dtic Minister Parks Tau under the Competition Act, facilitates specific types of collaborations in export markets, freeing them from certain provisions of the Competition Act.
The exemption provides opportunities for qualifying exporters to achieve economies of scale and efficiencies, share certain landed costs, export-related infrastructure, and market information. It also allows them to coordinate logistics, collectively market South African goods, and negotiate or contract with foreign buyers where permitted. This initiative responds to challenging global trade conditions, such as broad-based tariff increases by key trading partners, rising logistics costs, and increased complexity in accessing alternative export markets.
Mkhwanazi highlighted the shared responsibility between South African companies and the government to enhance the export ecosystem. He stressed the importance of Export Councils, industry associations, and provincial export-support agencies in identifying opportunities due to their insight into business and sector-specific challenges. He further noted that the Block Exemption should align with the broader support available to exporters through the dtic and its partners, including services like the Export Help Desk and various support programs.
Mkhwanazi remarked that while larger firms predominantly drive South Africa's exports, smaller businesses remain less engaged in international markets. The aim is to assist businesses in entering, competing, sustaining, and expanding within those markets. He emphasized the need for a reimagined export ecosystem, where companies could share costs and activities like market research, warehousing, logistics, and international marketing, as permitted under the regulations.
The dtic and the CCSA urged exporters and export-support organizations to understand the requirements and limitations of the Block Exemption before forming collaborative ventures. The exemption is applicable to qualifying activities within its scope and does not offer a blanket exemption from competition law.
