Economic Recovery Through Fair Business & Trade Practices

TARIFFS OPERATIONS

The Commission's trade tariffs operations primarily involve giving assistance or protection to local industry through, inter alia,: (i) the raising of tariff charges on imported commodities or services that compete with commodities or services provided by local industry; (ii) the lowering of tariff charges on imported commodities or services that are used by local industry;

(iii) the implementation of legislative or administrative measures for the purpose of countering unfair trade practices; and (iv) the technical assistance to Government in the conclusion of arrangements with other countries for the benefit of local industry.

TARIFFS CASES

The handling of tariffs cases by the Commission is governed and guided by the provisions of Part IVB of the Competition Act [Chapter 14:28] on 'investigation of tariff charges and related unfair trade practices'. The term 'tariff charge' is defined in terms of section 34B of the Act to mean "any duty, tax or charge levied by the State in connection with commodities or services imported into or exported from Zimbabwe", while the term 'unfair trade practice' is defined to mean "the dumping of imported commodities", "the granting of a bounty or subsidy with respect to imported commodities" and "any other practice in relation to the importation of commodities or services of the sale of imported commodities or the provision of an imported service where such practice is declared to be unfair (by the Minister of Industry and Commerce)".

(a) Tariff Relief Applications

The most common tariff relief applications are for import duty reduction on raw materials and tariff protection on finished local products. Requests for duty reduction on raw materials are more favourable to the Commission than those for tariff protection. Tariff protection is generally found to be inconsistent with trade liberalisation obligations under the Common Market for Eastern and Southern Africa (COMESA) and the Southern African Development Community (SADC), however are considered in exceptional cases involving the viability, and imminent closure, of the applicant company. It also negates import competition, which encourages enterprise efficiency.

Tariff relief applications are considered by the Commission in three basic steps, as follows:

  • Step 1: Tariff relief request submission or identification;
  • Step 2: Internal investigation and assessment in the Commission;
  • Step 3: Recommendations to the relevant Government authorities.

Step 1

Tariff Relief Request

Submission

Tariff relief requests (for duty reduction or suspension, tariff splits, import protection, etc.) are submitted to the Commission by the affected companies or industries.

The submissions must contain all the relevant information to enable the Commission to undertake the necessary investigations. The information required includes a description of the relevant products and their tariff codes, import sources and quantities, and justification of the relief sought.

Step 2

Tariff Relief Request Investigation

Tariff relief requests are investigated by the Tariffs Division of the Commission's Directorate. The investigations includes stakeholder consultations and economic analyses.

Factory visits are an essential part of the stakeholder consultations made.

Step 3

Tariff Relief Request Recommendation

The reports on the Tariff Division's investigations are submitted to the Commission's Tariffs Division for consideration, which in turn makes appropriate recommendations to the full Board of Commissioners.

The Commission then submits its recommendations to the Ministry of Industry and Commerce, which also consults the Ministry of Finance before a final decision is made on the tariff relief request.

(b) Unfair Trade Practices

Investigations into unfair trade practices (dumping and subsidisation) under the Competition (Anti-dumping and Countervailing Duty) (Investigation) Regulations, 2002 are protracted. They are not only based on information given by the complainants in detailed dumping forms but also on extensive stakeholder consultations and inspection visits to the countries of origin of the alleged dumped products. It is not unusual that some such investigations take years to complete.

The Commission has still not carried out a full investigation into an unfair trade practice, with many dumping allegations referred to it for investigation not technically involving dumping as defined in the Competition (Anti-dumping and Countervailing Duty) (Investigation) Regulations.

(c) Sectoral Studies

The Tariffs Division undertakes sectoral studies, to access the status and performance of the industry. The study's findings are usually forwarded to the Ministry of Industry and Commerce for policy determination.

Technical Work on Trade Policy Issues

(a) Trade Negotiations

The Tariffs Division attends and participates in trade negotiations, most of which are held under the auspices of the Ministry of Industry and Commerce. The Commission participates in preparing Zimbabwe's positions at bilateral, regional and international trade negotiations under the Common Market for Eastern and Southern Africa (COMESA), and the Southern African Development Community (SADC), Economic Partnership Agreement (EPA) and World Trade Organisation (WTO).

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