WT/TPR/M/324/Add.2  
8 February 2016  
(16-0825)  Page: 1/2  
Trade Policy Review Body 
4 and 6 November 2015 Original: English/anglais/inglés  
 
  TRADE POLICY REVIEW 
SOUTHERN AFRICAN CUSTOMS UNION 
MINUTES OF THE MEETING 
Addendum 
Chairperson: H.E. Mr. Atanas Paparizov (Bulgaria) 
This document contains the advance written questions and additional questions by WTO 
Members, and replies provided by the Southern African Customs Union members.1 
 
 
Organe d'examen des politiques commerciales 
4 et 6 novembre 2015 
EXAMEN DES POLITIQUES COMMERCIALES 
UNION DOUANIÈRE DE L 'AFRIQUE AUSTRALE  
COMPTE RENDU DE LA RÉUNION 
Addendum 
Président: S.E. M. Atanas Paparizov (Bulgarie) 
Le présent document contient les questions écrites communiquées à l'avance par les 
Membres de l'OMC, leurs questions additionnelles, et les réponses fournies par les membres de 
l'Union douanière de l'Afrique australe.1 
 
 Órgano de Examen de las Políticas Comerciales 
4 y 6 de noviembre de 2015 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
U
NIÓN ADUANERA DEL ÁFRICA MERIDIONAL  
ACTA DE LA REUNIÓN 
Addendum 
Presidente: Excmo. Sr. Atanas Paparizov (Bulgaria) 
En el presente documento figuran las preguntas presentadas anticipadamente por escrito y 
las preguntas adicionales de los Miembros de la OMC, así como las respuestas facilitadas por los miembros de la Unión aduanera del África meridional.
1 
 
                                               
1 In English only./En anglais seulement./En inglés solamente. WT/TPR/M/324/Add.2 
 
- 2 - 
 
  JAPAN 
 Report by Southern African Customs Union (WT/TPR/G/324)  
(Question 10: Page 318, Paragraph 3.110) 
Please disclose the method for penalty calculation method with specific numerical information in case the NIP obligation has not been fulfilled beca use the guideline does not provide such method. 
 
Answer 10 The NIP policy provides for a Performance Guar antee of 5% of the obligation value. All 
NIP obligation agreements specify that in th e event of non performance, the dti reserve 
the right to demand the performance guarant ee. The performance guarantee is the last 
resort where companies have not been able to remedy the non-performance. 
 
(Question 11: Page 318, Paragraph 3.110) 
The Department of Trade and Industry provides NIP reports 2003 – 2008 but has not provided NIP 
reports since 2009 on its website. We request to provide NIP reports from 2009 to the latest one.  
 
Answer 11 The NIP reports from 2003 - 2009 were based on the request from the portfolio committee on Trade and Industry specifically  to monitor the performance of obligors 
related to the Strategic Defense Procurem ent Packages. These companies have all 
fulfilled their obligations. NIP reports now form part of the Industrial Development 
Division section in the dti annual reports. 
 
(Question 12: Page 318, Paragraph 3.110) On the web site of the Department of Trade and Industry, it explicitly says that the NIP contract 
will be signed approximately four weeks after the program approval. However, in fact, it has been 
reported that suppliers are first forced to sign th e NIP contract at the stage of public procurement 
tenders, then discuss and negotiate the content of the program for approval, sometimes for as l o n g  a s  s e v e r a l  y e a r s .  I s  t h e  g o v e r nm e n t  a w a r e  o f  s u c h  i n v e r t e d  p r oc e s s  o f  N I P ?  I f  s o ,  p l e a s e  
explain the rationale. The government of Japan requests a proper implementation of the NIP 
process cohere the signing of NIP contracts sh ould take place only after agreement on the 
program content is reached, and that approval pe riod of the program content shall be expedited, 
observing the standard of approximately four weeks. 
 
Answer 12 
The NIP Guidelines provide for the NIP Ob ligation Agreements to be concluded and 
signed within a period of 3 months after the award and conclusion of the main purchase 
agreement. However, companies bidding for state tenders need to commit to fulfilling 
the obligation agreement should they be awarded the tender and the imported content 
is more than US $10 million. This is do ne through the signing of the Supplier Bid 
Document (SBD5), which is a one page document  included as part of tender documents. 
The period of fulfilling the obligation is 7 year s. This takes into account the time it takes 
to identify and implement projects. If obligor s are able to identify projects before the 
signing of the agreement, then these can be in cluded as part of the agreement. This has 
happened in a few instances where bidders are already familiar with South Africa. 
Where any business proposal is submitted, it takes a maximum period of 2 months 
(provided sufficient information is submitted)  for the IPCC to make a decision. The IPCC 
sits once a month.  
(Question 13: Page 318, Paragraph 3.110) 
NIP is the obligation on the import of goods and services for public procurement above a certain amount. Please explain the specific laws and regulations stipulating the legal grounds of the NIP 
obligation. 
 Answer 13 
NIP forms part of the four-tier system of pu blic procurement levers approved by Cabinet 
in December 2012. It is implemented by mean s of Treasury Instruction notes sent to all 
state institutions.  
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