South Africa has significantly more financial crime than most other countries. With a rate of 77% compared to a global average of 49%, SA is something of a hotbed for fraud and scams.
As consumers and insurance-seekers we need to understand the risks of economic crime and how to avoid becoming a victim, the risks of committing insurance fraud and how to avoid being inadvertent perpetrators of fraud ourselves, by for example, omitting information in an insurance application
Herman Lombard, Founder and Executive Director of financial services provider African Unity, explains that an intentionally fraudulent claim could result in cancellation of the policy as well as a negative reputation with the insurer and the industry in general.
“Consumer fraud is the second highest ranking category of reported economic crime in the country and life insurance fraud in particular has seen a recent spike, which means insurance companies are being increasingly thorough and vigilant”.
Multiple retrenchment applications from the same employer; natural death suspiciously soon after the commencement of a life-policy; and opportunistic life policies taken against the imminent death of casual church or work acquaintances are some of the most common insurance scams perpetrated by consumers.
Companies however are rising to the challenges of intensified scam activity, becoming more self-aware and able to identify and correct their own vulnerabilities.
Lombard explains that the best way to avoid the pitfall of unintentionally committing fraud yourself is to ‘overshare’ and disclose absolutely everything in your insurance applications, even if you’re uncertain of its relevance. “The rule of thumb is to rather share too much than too little and risk future payouts,” he says.
As many South Africans know only too well, there are many insurance sales fraudsters who be able to victimise even the savviest consumer. One of the most common is linked to funeral cover where the victim is led to believe they have bought funeral cover and pay over their monthly premiums in good faith. These ‘policies’ are often sold face-to-face, and the premiums collected in cash. It’s very often only when a loved one passes away and the funds are needed to cover funeral costs that the ‘policy-holder’ will discover that they don’t have the cover they thought they had.
Lombard advises that when buying insurance, consumers must ensure that they know which insurance company will be responsible for paying out the claims and must ensure that it is a reputable organisation. He adds that customers must also insist on seeing the policy document before handing over any money.
But economic fraud doesn’t stop there.
The internet and social media have provided a whole new world of potential scams to fraudsters. Digital banking fraud has increased dramatically and in 2018 amounted to a staggering R262 million in gross losses in South Africa.
Lombard explains that the most common digital banking frauds are unauthorised SIM swaps while you’re on your banking app, or voice phishing or ‘vishing’ where a fraudster persuades you over the phone to divulge confidential information related to your bank account, like your one-time password (OTP).
People who live alone should remain especially wary as research shows this group is particularly susceptible to scammers and fraudsters, having no one else around to potentially warn or intervene. There appears to be a strong correlation between social isolation and becoming a victim of fraud. Financial illiteracy, as well as financial desperation play a significant role.
Experts warn that social-media based scams are also highly prevalent and effective in duping victims, far more than their veteran telephone- and email- based counterparts. “Don’t let your guard down and try to ensure the authenticity of each and every communication you receive.” says Lombard.
“Prior knowledge of how a scam works enables consumers to detect red flags and dissociate before they even begin to engage with scammers”, says Lombard.
Some of the most common types of online scams to watch out for in SA are:
Fake Facebook Giveaway – Scammers lure victims with promises of outrageously generous prizes, only to ‘phish’ the personal and financial details of those naïve enough to engage. These scams usually attempt to mimic a popular brand or celebrity page, as such your first line of defence is to ensure you are dealing with a Facebook-verified company page.
CNP (Card not Present) Fraud – This very common fraud involves illegitimate online purchases without the use of a physical card or the cardholder’s permission. The card details are usually acquired via data breaches, malware or phishing. Be cautious with your credit cards and only shop at reputable online stores. Watch your statements, and obviously never give out credit card details in your emails.
Advance-Fee Scam – this involves being offered a vast sum of money for a seemingly legitimate reason, on condition that a small administrative fee is deposited and / or bank details furnished. Often the ruse is successful because scammers pose as financial service providers offering personal loans. Always check whether an alleged financial services provider has a genuine official website. Spelling and grammatical errors are a major red flag. And remember that a real registered credit provider would never ask for money upfront in order to confirm a loan.
WhatsApp Scams – Similar to the Facebook scams, these work by virally spreading links that appear to be from either an above-board business or WhatsApp itself. Clicking on the links allow fraudsters to infiltrate your device with malware. Be very wary of any WhatsApp messages which offer prizes or discounts and which requires to be spread among your contacts.
“There are many types of scams which are designed to steal the things that you hold dear, like your identity and your hard-earned cash. If you have been scammed it’s important that you report it and that you talk about it to your friends and family so that they don’t fall victim to the many unscrupulous crooks out there,” concludes Lombard.
South Africa has the highest rates of childhood obesity in the world, with an alarming figure of 13%. The global average stands at 6%. One of the main causes of South Africa’s rate is the rapid growth of the country’s commercial food industry.
This has led to increased consumption of cheap, easily accessible and ultra-processed food that is high in sugar.
We analysed the sugar content of a variety of baby food products. The study sample included commercially available baby foods – including boxes of cereals and jars of processed food – targeted at children under 12 months and sold in supermarkets and other major retailers in South Africa. We collected data on sugar content and compared this with recommended intake guidelines. We also checked if the sugar content was added sugar or free sugar – the kind often found in processed food.
We also characterised the food based on back of the package information. This wasn’t easy as the facts are provided in tiny font that is difficult to read and interpret. For example the content is usually shown as grams per 100 ml or per serving, not in teaspoons.
Our findings showed that most baby cereals have added sugar. This is a concern because they are often the first food given to babies when they are weaned. We also found that pureed fruit and desserts had very high levels of sugar (20g or more per serving; that’s about 4 teaspoons).
This is bad news for the future health of South Africa’s population because it encourages a “sweet tooth” in children – in other words a preference for foods that taste sweet for the rest of their lives.
Sugar is a big contributor to increased tooth decay. It also results in childhood weight gain and obesity that causes preventable diseases later in life such as diabetes, high blood pressure and cancer. Although the sweet-taste preference is present at birth, exposure to too much sugar early in life can affect what people eat, including a preference for sweet things.
What this adds up to is that, in the long term, sugar in baby products will contribute to South Africa’s rising burden of noncommunicable diseases and will affect life expectancy.
Global weaning guidelines recommend that babies get fed complementary foods that don’t have added sugars. The aim is to ensure that the threshold for sweet tastes is set at lower levels. In turn, this helps prevent health problems in both childhood as well as later in life.
We conclude that there’s an urgent need to start regulating sugar in baby foods. South Africa’s childhood obesity crisis won’t be resolved unless the baby food industry stops promoting the development of sweet preference from an early age.
What we found
Commercial baby foods are often introduced as first foods to infants in South Africa because they are convenient and easy to use. This makes our findings particularly alarming.
We collected and analysed the sugar content of 235 baby food items from 12 different manufacturers sold in major South African supermarkets. Nearly 90% were prepared baby food products, of which 35% were pureed fruit and 20% were pureed meals.
Only one in five of the baby foods in the study had acceptable levels as defined by the World Health Organisation (WHO) – that is, less than 20% of total calories was derived from sugar.
But nearly 80% of cereals and pureed desserts contained added sugar. Processed meals that contained added sugar, including honey, were a carrot blend with semolina and two types of breakfast oats.
The study also shed light on the fact that little information was available to consumers on the ingredients used in the baby foods. For example, it was almost impossible to identify which products had added sugar versus those that had intrinsic (natural) sugars only. Both are unhealthy in processed products.
On the basis of our study, we have a number of recommendations. The first is that the amount of sugar in baby food should be regulated as a matter of urgency. To start with, mandatory disclosure of added sugar by manufacturers and the introduction of a food labelling system is essential.
A promising example is Chile’s warning octagonal logos that tell consumers if a product exceeds a recommended limit of sugar. There is already less demand for juices and cereal with high sugar content.
And given the importance of serving sizes in controlling obesity, information on nutrients per portion and the number of portions per package should be included. It would help if this were standardised across all related food products, which is currently not the case.
Consumers can’t make informed choices about what’s in the food they are feeding their infants without easily understandable labels of calorie and nutritional information. Even if they wanted to stick to the WHO’s recommendation that the intake of free sugars should be reduced to less than 10% of total energy intake, the public can’t do so because of a lack of clearly understandable information.
We also recommend limiting sweet, processed baby foods in favour of healthier alternatives.
We acknowledge the contribution of Agnes Erze in the preparation of this piece. She is a research fellow at the SAMRC/Wits Centre for Health Economics and Decision Science/PRICELESS.
Karen Hofman, Professor and Program Director, SA MRC Centre for Health Economics and Decision Science - PRICELESS SA ( Priority Cost Effective Lessons in Systems Stregthening South Africa), University of the Witwatersrand and Nicola Christofides, Associate Professor, School of Public Health, University of the Witwatersrand
South African police said on Thursday they had arrested a number of people, including two former senior managers of Eskom, on suspicion of involvement in fraud and corruption worth 745 million rand ($51 million) at the troubled state-run power firm.
The managers, as well as two business directors and seven companies, are expected to appear in court on Thursday to face the police allegations, which also included money laundering, South Africa’s elite police unit the Hawks and National Prosecuting Authority said in a joint statement.
The individuals, who were not named, were arrested earlier in the day following an investigation into the construction of large projects at two power stations, the statement said.
This revealed “gross manipulation” of contracts between contractors, Eskom employees and third parties at one of them, it continued.
“Eskom continues to work with law enforcement agencies … to root out corruption and malfeasance,” the power provider said in a statement, adding the names of the individuals could not be revealed until they appeared in court.
“We … will leave no stone unturned in ensuring that perpetrators … are brought to book,” it added.
The ailing utility, which provides 90% of South Africa’s power, has been struggling to keep the lights on amid serious financial problems in part stemming from years of mismanagement and alleged graft.
Last week, it had to implement some of the most far reaching planned blackouts in years and is regularly cited by ratings agencies as one of the main risks to South Africa’s economy.
“This is a great milestone in the fight against corruption in our country,” South Africa’s Special Investigating Unit, which was also looking into the allegations, said.
Eskom’s problems are a headache for President Cyril Ramaphosa, who has staked his reputation on fixing ailing state-owned firms and reviving South Africa’s flagging economy.
Former leader of the radical South African left, Julius Malema, was unsurprisingly reappointed on Saturday night at the head of his party, the Economic Freedom Fighters (EFF) meeting Congress in Johannesburg.
“For the position of president, it is Mr. Julius Malema,” Terry Tselane, a private company official in charge of organizing the election, told the 3,000 party delegates.
Aged 38, Mr. Malema founded the EFF in 2013 after his ouster from the ruling African National Congress (ANC).
Still wearing his red beret as “commander in chief” of the movement, he presents himself as the defender of the poorest and advocates the redistribution of wealth for the benefit of the country’s black majority, whose situation has improved little, a quarter of a century after the fall of apartheid.
His anti-capitalist and willingly anti-White rhetoric, particularly in favour of expropriation without compensation of land held in majority by the white minority, has led to multiple lawsuits.
In last May’s general elections, the EFF won nearly 11% of the vote, a significant increase over the previous election, and increased the number of its members in the Cape Town Parliament from 25 to 44.
“We represent the poor and oppressed here,” Julius Malema reaffirmed on Saturday by opening his party’s congress.
“The scars of colonialism and apartheid are still there. The failure to change the property structures in our economy and return the land to our people has resulted in our people having political rights, but no economic freedom,” he said to applause.
The EFF congress – the second in its young history – is disrupted by a controversy arising from its refusal to accredit several local media, including the online news website Daily Maverick, which published several articles accusing party leaders of embezzlement.
“No other party in post-apartheid South Africa has been considered as much of an enemy of society as the EFF,” Malema lamented in the gallery, denying the corruption charges as “a storm in a glass of water.
In solidarity with the banned media, the news channel eNCA has decided to suspend its coverage of the congress.
“Good riddance,” the EFF reacted in a statement.
Malema wants the six-year-old organisation to have a presence everywhere on the continent.
“Our vision is not these small-minded things you’re thinking about; we want to lead Africa. We want a United States of Africa with one currency, economy, and judiciary,” Malema said.
Credit: Africa Global Village
The phrase “medical xenophobia” is often used to describe the negative attitudes and practices of South African health care professionals towards refugees and migrants. It is used whenever foreign nationals are denied access to any medical treatment or care.
Research on migration and health in South Africa has documented public health care providers as indiscriminately practising “medical xenophobia”. But this dominant, single narrative around migrants and health care is misleading.
My recent research showed that there was more complexity, ambivalence and a range of possible experiences of non-nationals in South Africa’s public health care system. I conducted the research in a public health clinic in Musina, a small town on the border of South Africa and Zimbabwe.
I found that frontline health care workers provided services, including HIV treatment, to black African migrants who are often at the receiving end of xenophobic sentiment and violence. This was in spite of several institutional and policy-related challenges.
Discretion and innovation played a crucial role in inclusive health care delivery to migrants in a country marred by high xenophobic sentiment. This was because health care providers subscribed to an ethos of what was right for the patient.
Public health and individual discretion
There are a few issues with the current framing of “medical xenophobia”. First, the focus on attitudes – and not health care delivery – reflects a particular generalisation of how health providers are perceived to treat African migrants in South Africa.
This framing does not consider challenges facing the health system. These include shortages of medical personnel. Many migrants seeking care in South Africa’s public health system do face challenges arising from being “foreigners”. But there are other grounds beyond citizenship or legal status on which medical care might be denied. Not all cases of poor treatment are “medical xenophobia”.
South Africans also face challenges with the public health care system. These are related to the general shortages of nurses and doctors. Other challenges include high bed occupancy, high workload, low morale among nurses in public health facilities and the burden of the HIV pandemic.
Second, existing policy responses to communicable diseases in South Africa and the southern African region do not adequately cater for migrants. For example, treatment guidelines in South Africa have been found to be incomplete or inapplicable to migrant patients. Policies and programmes in the Southern African Development Community on communicable diseases such as HIV do not extend to migrant patients.
Health care providers often have to operate within these institutional, bureaucratic and policy constraints.
This scenario makes frontline discretion unavoidable. Health care providers have to rely on their own judgement to determine what “best practices” to invoke with relatively little input or interference from other institutions.
In spite of these challenges, frontline health care providers were doing their best to provide health services to black African migrants. They bypassed institutional and policy-related barriers to registering and treating undocumented migrants, non-native speaking migrants and migrants without referral letters.
This suggests that the experiences of non-nationals in South Africa’s public health care system were more complex and varied than implied by the dominant discourse on “medical xenophobia”.
It is true that some health care providers stereotyped migrant patients and blamed them for their destitution. But my research showed that these stereotypes didn’t directly translate to the exclusion of migrant patients from health care services. This was because of the health workers’ strong professional conduct and an awareness of the public health implications of not providing migrant patients with HIV treatment.
Working around the system
Health care providers in the clinic I visited came up with a system of using the date of birth to identify and keep a record of undocumented migrant patients. This replaced the 13-digit South African identity number, which is normally used to open patient files. Several of them used notions of morality, ethics and public service to frame their decision making. They understood health care to be a right for everyone, in line with Section 27 of the country’s constitution.
Others provided HIV treatment to migrant patients without referral letters. This decision was also mediated by how patients professed their “belonging” through “alternative” forms of knowledge and expertise. For example, one nurse claimed that she only provided anteretroviral therapy if migrant patients demonstrated knowledge of their medication, or if they brought a medicine container for a refill.
Health care providers reported difficulties interacting with migrant patients who spoke Swahili, French, Portuguese or Chewa. Staff and local patients worked together to ensure that migrant patients accessed health care services, often in extremely demanding circumstances. Health care providers made the effort to connect with migrant patients through informal interpreters by asking co-workers or patients fluent in these non-native languages to translate in English or other native languages.
These health care providers didn’t use language, documentation and referral letters to discriminate against migrant patients. They used innovation, creativity and compromise to provide services to migrant patients living with HIV.
Policymakers need to recognise the importance of human relationships, communication networks, leadership and motivation in strengthening the country’s ailing public health system.
More crucially, activists need to identify the informal, inclusive and innovative practices of health care providers in addressing challenges related to documentation, referrals and language.
This should be coupled with calls to strengthen and invest in these grassroots responses to build greater solidarity. This is what can be done while waiting for policymakers to respond to ongoing calls for public health care systems to adequately engage with mobility.
South Africa’s Vodacom Group and MTN Group could face prosecution if they do not agree with the Competition Commission in the next two months to lower data prices, the watchdog said in findings from an inquiry published on Monday.
The data services inquiry was launched in August 2017 in response to a request from the minister of economic Development and after complaints from consumers about high data costs.
In its final report, the Commission recommended that the two mobile operators must independently reach agreement with the competition watchdog on substantial reductions on tariff levels, especially prepaid monthly bundles, within two months of the release of the report.
It said the preliminary evidence suggests that there is scope for price reductions in the region of 30% to 50%.
The mobile operators must also reach agreement “to cease ongoing partitioning and price discrimination strategies that may facilitate greater exploitation of market power and anti-poor pricing.”
“With respect to the above recommendations on the level and structure of pricing, should an operator fail to reach the required agreements with the Commission within the specified timeframes, the Commission will proceed to prosecution under the appropriate sections of the Act,” The Commission said in a summary of its report.
One of the most important discoveries of the year took place 1785km off the southern coast of South Africa where Total has made a gas condensate discovery on the Brulpadda prospects, located on Block 11B/12B in the Outeniqua Basin.
The exploration well encountered 57 metres of net gas condensate play in Lower Cretaceous reservoirs. Following the success of the main objective, the well was deepened to a final depth of 3,633 metres and has also been successful in the Brulpadda-deep prospect.
Speaking at Africa Oil Week last week (Africa-OilWeek.com), Dr Enzo Insalaco, Vice President Exploration Africa at Total explained that South Africa has become an interesting area for exploration. “When you look at the fundamentals, you can see a scenario where there are a number of significant, relatively underexplored basins and many of the play fundamentals are present in these places,” he says. “We see that there's a lot of scope for exploration and significant potential.”
That interest has been illustrated by the recent activity by the industry, which has seen a significant amount of seismic capture and blocks being taken in Namibia and South Africa. “Much of that activity is early stage, so 2D or 3D,” Insalaco added. “What we will see in the next few years is an uptick in reservoir drilling and exploration.
We have a strong position in the oil basin, so we have a couple of blocks in the Orange Basin and in South Africa the 11B/12B block where this discovery was made.”
Opening a new petroleum basin
For Total, Brulpadda was certainly a high impact well for opening up what they believe is a significant petroleum basin. “It was a very bold technical well,” Insalaco continued. “Many people may not realise that the well was actually drilled on 2D. It is a deep offshore well, so drilling on 2D was a very bold move. But given our understanding of the basin and the innovations we did on the operations, this well could be drilled safely and successfully on 2D.
“As we know, it was an operational success just as much as a technical success; we drilled the well within budget, within time and in terms of NPT we have about 3% of NPT and 3% waiting on weather. If you consider the conditions, that is fantastic operational performance. We drilled the well to the main reservoir log and then we went down to a deeper reservoir.
“We did extensive logging records, took samples of fluid, reservoir and source rock. It was a fantastic result in terms of operational performance and data acquisition. It is a gas and condensate and oil discovery, both traces were found. The reservoirs were well developed with good fluid and reservoir properties. You could not really wish for more information from an exploration well. That data acquisition has really put us in a great position going forward to be able to accelerate the next level and the evaluation.”
A fast track to production
The fact that Total drilled the prospect on basic 2D seismic data meant that they needed to hit the ground running in the discovery scenario. They planned for success and were ready to shoot the 3D campaign as soon as they were comfortable that the well was successful and there was going to be potential on the basin. “We were ready for 3D, we were already negotiating contracts on the way,” Insalaco added. “When you look at the milestones on the well you can see that we finished our P&A in the first week of February.
The rig moved offsite the middle of February, and the first 3D seismic shot was done on the 14th of March. A month between the first shot of seismic and the end of the work which is a fantastic performance.
“We also fast tracked the seismic acquisition, so we could start looking at the potential on the new data by June of this year and that allows us, together with the information that we collected, to fast track well evaluation and put us into position to commission the rig and be able to drill early next year. Doing as many processes in parallel allowed us to save 18 months to two years in the well programme and I don't think we can compress that timeline anymore, given the operational constraints and the operational windows for the seismic acquisition.”
With the initial phase of the 3D seismic acquisition programme over the basin completed, the Brulpadda well results will be integrated with the 3D seismic data ahead of the drilling programme in 2020, which will include up to three exploration wells.
Sir Richard Branson has apologised for a photo he used to mark the launch his new Branson Centre of Entrepreneurship in South Africa.
The entrepreneur tweeted a photo which was criticised for failing to reflect the diversity of South Africa.
One of the critics is South African fashion designer Thula Sindi, who says: "Where did you find so many white people in South Africa?"
Sir Richard tweeted an apology, saying it "clearly lacked diversity".
A Virgin Group spokesperson added the image in Sir Richard's tweet did not reflect "the diverse make-up of attendees" at the launch event.
In the intial tweet, Sir Richard said: "Wonderful to be in South Africa to help launch the new Branson Centre of Entrepreneurship. We aim to become the heart of entrepreneurship for Southern Africa."
Plastic milk bottles are being recycled to make roads in South Africa, with the hope of helping the country tackle its waste problem and improve the quality of its roads.
Potholes cost the country's road users an estimated $3.4 billion per year in vehicle repairs and injuries, according to the South African Road Federation, as well as damaging freight.
In August, Shisalanga Construction became the first company in South Africa to lay a section of road that's partly plastic, in KwaZulu-Natal (KZN) province on the east coast.
It has now repaved more than 400 meters of the road in Cliffdale, on the outskirts of Durban, using asphalt made with the equivalent of almost 40,000 recycled two-liter plastic milk bottles.
Road to recycling
Shisalanga uses high-density polyethylene (HDPE), a thick plastic typically used for milk bottles. A local recycling plant turns it into pellets, which are heated to 190 degrees Celsius until they dissolve and are mixed with additives. They replace six percent of the asphalt's bitumen binder, so every ton of asphalt contains roughly 118 to 128 bottles.
Shisalanga says fewer toxic emissions are produced than during traditional processes and says its compound is more durable and water resistant than conventional asphalt, withstanding temperatures as high as 70 degrees Celsius (158F) and as low as 22 below zero (-7.6F).
The cost is similar to existing methods, but Shisalanga believes there will be a financial saving as its roads are expected to last longer than the national average of 20 years.
"The results are spectacular," says general manager Deane Koekemoer. "The performance is phenomenal."
Unlike in Europe, for example, where recyclable plastic is often collected directly from homes, in South Africa, 70 percent is sourced from landfill. The plastic will only be taken from landfill if there is somewhere for it to go -- such as into roads. Shisalanga says that by turning bottles into roads it is creating a new market for waste plastic, allowing its recycling plant partner to take more out of the nation's dumps.
Kit Ducasse, control technician at the KZN Department of Transport -- which commissioned the plastic repaving -- is "impressed" with the road and has now commissioned a highway on-ramp in addition to the first road. "It's working so well," he says. "Time will tell, but what I've seen is great news."
Shisalanga has applied to the South Africa National Roads Agency (SANRAL) to lay 200 tons of plastic tarmac on the country's main N3 highway between Durban and Johannesburg and is awaiting approval for the project.
If it meets the agency's requirements, the technology could be rolled out across the nation. Since SANRAL's standards are so high, Shisalanga hopes it would then be able to meet the strictest regulations across the world.
Tackling the plastic problem
India began laying plastic roads 17 years ago, and the concept has been tested in locations across Europe, North America and Australia. But there are concerns over potential carcinogenic gases created during production and the release of microplastics (tiny particles of plastic) as the roads wear away.
"Such issues have to be ruled out, otherwise we're going to contribute to and not alleviate the national environmental waste problem," says Georges Mturi, senior scientist at CSIR.
Shisalanga has spent five years researching the technology. Its technical manager Wynand Nortje says its method of melting the plastic into the bitumen modifier minimizes the risk of microplastics. "The performance of our plastic mix is better than traditional modifiers, the fatigue seems improved and resistance to water deformation is as good or better," he adds.
Roads are one of many creative solutions to reusing plastic waste. Companies around the world are turning it into bricks, fuel and clothing.
Some other international companies have even found ways to repurpose so-called "non-recyclable" plastic into roads. But Mturi at CSIR believes this is currently too risky in terms of emissions and microplastics, because the properties of this plastic are so variable.
Still, Koekemoer hopes to expand into using non-recyclable plastic in the future, allowing the company to get even more waste plastic out of the environment.
"We're taking plastic out of our dumps (landfills) and we're reducing our pollution problem, and to top it off we've produced a product that's far superior to alternatives," says Koekemoer. "We're leading the global curves."
The Office of the United States Trade Representative (USTR) is reviewing its current dealings with South Africa based on intellectual property concerns.
In a statement on Friday (25 October), the group said that it would review South Africa’s eligibility to participate in its Generalized System of Preferences (GSP) based on a petition it had received.
The GSP is the largest and oldest US trade preference program.
It is designed to promote economic development by allowing duty-free entry into the United States for 3,500 products from the 119 designated beneficiary countries and territories.
To remain eligible for these advantages, beneficiary countries must comply with 15 statutory eligibility criteria that are important to US interests, including taking steps to afford internationally recognized labour rights, providing adequate and effective protection of intellectual property rights, and assuring equitable and reasonable access to its markets.
Why South Africa is being reviewed
The USTR said it is reviewing South Africa after accepting a petition from the International Intellectual Property Alliance.
The petition outlines concerns with South Africa’s compliance with the GSP’s intellectual property criteria in the area of copyright protection and enforcement.
While the USTR did not comment on the contents of the petition, the International Intellectual Property Alliance has previously raised concerns about the Copyright & Performers’ Protection Amendment Bill which is awaiting presidential approval before being signed into law.
The bill’s primary aim is to provide fair compensation to publishers, artists and film producers.
However, the bill has also come under intense scrutiny as some provisions allow for the ‘free use’ of certain copyrighted material.
In an August 2019 letter – signed by the Motion Picture Association (MPA) and the International Confederation of Music Publishers (ICMP) among others – a number of international bodies asked that Ramaphosa take the bill back to Parliament for a ‘proper, sector-specific impact assessment and meaningful consultation with affected stakeholders’.
“The South African Government has committed itself to modernising South African copyright law to bring it into line with the WIPO Internet and Beijing treaties, which South Africa intends to ratify,” it states.
“Our communities fully support these policy aims. Regrettably, the Copyright Amendment Bill and the Performers’ Protection Amendment Bill, as currently drafted, would not only fail to achieve these stated aims but they would instead undermine South Africa’s creative communities.
“The proposals contained in the bills would, if adopted, limit the creative sectors’ ability to protect their rights and invest in South Africa, substantially weakening the South African internal and export markets for creative content.
“This would harm South Africa’s creators, its strong creative culture and, ultimately, its citizens.”
Warning signs were there
Copyright lawyer Carlo Scollo Lavizzari has previously warned that the bill will lead to South Africa breaching its international obligations, causing unnecessary diplomatic stress and damage to the economy.
“(The bill) translated into the real world, will damage filmmakers, musicians, authors, TV productions and software businesses by diminishing access to publishing for authors locally, forcing them to publish for overseas audiences,” he said.
He said that this would decimate the local film and music industries.
“For South Africa to come ‘first’ the country needs to have a first-rate, up-to-date copyright act that benefits the creative sector.
“Today, having sound laws on copyright is simply the price of entry a nation pays to compete for talent.
“Respecting world standards of copyright protection in the digital world is no contradiction to offering world-class opportunities for creators and knowledge workers — it is actually a pre-condition.”