G/SG/N/7/ZAF/2  
G/SG/N/11/ZAF/2  
 
21 June 2013  
(13-3234)  Page: 1/3  
  Original: English  
 
  NOTIFICATION UNDER ARTICL E 12.4 OF THE AGREEMENT 
ON SAFEGUARD BEFORE TAKING A PROVISIONAL 
SAFEGUARD MEASURE REFERRED 
TO IN ARTICLE 6 
 
NOTIFICATION PURSUANT TO ARTICLE 9, 
FOOTNOTE 2 OF THE AGREEMENT 
ON SAFEGUARDS 
SOUTH AFRICA 
(Frozen potato chips) 
 
The following communication, dated 14 June 2013, is being circulated at the request of the Delegation of South Africa. 
 
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Pursuant to Article 12.4 of the Agreement on Safeguards, the Government of  South Africa hereby 
gives notification before taking provisional safeguard measures for imports of frozen potato chips; 
and a notification pursuant to Article 9, footnote 2 of the Agreement on Safeguards, on taking a 
decision not to apply those measures to imports from developing countries.  1. The product subject to the investigation 
 
The subject product is described as frozen pota to chips, classifiable under tariff subheading 
2004.10.90. 
 
2. The provisional safeguard measure  
The provisional safeguard measure consists of ad valorem  Safeguard duty of 61.42%. 
 3. The proposed date of imposition of the safeguard measure  
The provisional safeguard measure is proposed to be imposed on 1 July 2013. 
 4. The expected duration of the provisional safeguard measure, if any decision on the 
duration of the measure has been made 
 Two hundred (200) days. 
 
5. Provide the basis for:  
i. making a preliminary determination, as provided for in Article 6, that increased 
imports have caused or are threatening to cause serious injury; and, 
ii. determining that there are critical circumstances where delay would cause damage 
which it would be difficult to repair. G/SG/N/7/ZAF/2 • G/SG/N/11/ZAF/2 
 
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  The International Trade Administration Commission of South African initiated an investigation 
pursuant to an application by McCain foods (SA) (Pty) Ltd (the Applicant), on behalf of the SACU industry in order to determine whether increased imports have caused serious injury to the domestic industry, within the meaning of the Agreement on Safeguards, in connection with frozen 
potato chips. 
The preliminary determinations of the investigation are that there is sufficient evidence of serious 
injury to the domestic industry caused by increased imports. 
a. Increased Imports: There is sufficient information to indicate that there is a recent, 
sudden, sharp and significant increase in imports. 
In comparing the 2009 and 2010 financial periods the rate of increase in net imports in absolute 
terms was 811.23%. The net imports increased by 94.74% for the 2011 financial period compared 
to the 2010 financial period and decreased by 15.57% in 2012 compared to 2011. The rate of 
increase in net imports relative to the producti on for the financial years 2009 to 2010 was 789 
index points and for the financial years 2010 to 2011 the rate of the increase of 1,167 index 
points. There was a decrease in net imports relative to production between 2011 and 2012 
financial periods of 756 index points.  
In conclusion, the recent, sudden, sharp and sign ificant increase of the imports of the subject 
product occurred in the period 2009 to 2010 and the subject product continued to be imported in 
increased quantities both in absolute terms and relative to production. The imports in 2010 compared to 2009 increased in absolute terms by 811.23% and in 2012 compared to 2009 the imports remained at high levels and were 1,398% more in 2012 compared to 2009. The imports 
relative to production increased by 789 index points in 2010 compared to 2009 and remained at a 
high level in 2012 at 1,300 percentage index points compared to 100 percentage index points in 2009. 
b. Unforeseen Developments: The unforeseen developments are as follows: 
- Proliferation of Quick Service Restaurants; 
- Excess production capacity of the frozen potato chips in the European Union; 
- EU not keeping up with its export subsidy commitment made in 1995. 
c. Serious injury: There is sufficient evidence that the SACU industry is suffering serious 
injury in the form of: 
- a decrease in sales volumes; and  
- market share for the period 2008 to 2012. 
d. Causal link between increased import and serious injury:  There is sufficient 
information to indicate that the serious injury experienced by the SACU industry, is caused by the 
recent, sudden, sharp and significant surge in th e volume of imports. There are no other known 
factors other than the increased imports that sufficiently detract from this causal link. 
e. Adjustment plan:  The domestic industry has submitted an adjustment plan, outlining the 
measures it put into place for facilitation of adjustment of the domestic industry to the competitive 
conditions with the imports. 
f. Critical circumstances: Imports in 2010 compared to 2009 increased from 1,504 tons to 
13,705 tons which represent an increase of 811.23%.  The imports remained in 2012 at high levels 
and were 1,398% more in 2012 compared to 2009 from 1,504 tons in 2009 to 22,534 tons 
in 2012. 
The SACU industry's market share declined from 98.09% in 2009 to 76.84% in 2012 and the 
SACU industry's sales volume decreased from 2009 to 2012 by 3.34%.  
In view of the above, the Commission found that critical circumstances exist justifying imposition 
of provisional safeguard duties. 
g. Offer of consultations under Article 12.4:  The Government of South Africa offers 
consultations on the provisional measures. 
Below is the list of developing countries excluded from measures as they exported less than 3% of 
total imports to South Africa (Article 9.1 of the Agreement on Safeguards): G/SG/N/7/ZAF/2 • G/SG/N/11/ZAF/2 
 
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  LIST OF DEVELOPING COUNTRIES EXCLUDED FROM THE MEASURES  
Country Country 
Afghanistan 
Albania 
Algeria 
American Samoa Angola 
Antigua and Barbuda 
Argentina Armenia Azerbaijan 
Bangladesh 
Belarus Belize Benin 
Bhutan 
Bolivia Bosnia and Herzegovina 
Botswana 
Brazil Bulgaria Burkina Faso 
Burundi 
Cambodia Cameroon Cape Verde 
Central African Republic 
Chad Chile 
China 
Colombia Comoros Congo, Dem. Rep 
Congo, Rep. 
Costa Rica Côte d'Ivoire Cuba 
Djibouti 
Dominica Dominican Republic 
Ecuador 
Egypt, Arab Rep. El Salvador Eritrea 
Ethiopia 
Nicaragua Niger Nigeria 
Pakistan 
Palau Panama 
Papua New Guinea 
Paraguay Peru Philippines 
Romania 
Russian Federation Rwanda Samoa 
São Tomé and Principe 
Senegal Serbia 
Seychelles 
Sierra Leone Solomon Islands Somalia 
South Africa 
Uganda Ukraine Uruguay 
Uzbekistan 
Vanuatu Venezuela, RB 
Vietnam 
West Bank and Gaza Yemen, Rep. Zambia 
Zimbabwe Fiji
 
Gabon 
Gambia, The 
Georgia Ghana 
Grenada 
Guatemala Guinea Guinea-Bisau 
Guyana 
Haiti Honduras India 
Indonesia 
Iran, Islamic Rep. Iraq 
Jamaica 
Jordan Kazakhstan Kenya 
Kiribati 
Korea, Dem Rep. Kosovo Kyrgyz Republic 
Lao PDR 
Latvia Lebanon 
Lesotho 
Liberia Libya Lithuania 
Macedonia, FYR 
Madagascar Malawi Malaysia 
Maldives 
Mali Marshall Islands 
Mauritania 
Mauritius Mexico Micronesia, Fed. Sts. 
Moldova 
Mongolia Montenegro Morocco 
Mozambique 
Myanmar Namibia 
Nepal 
South Sudan Sri Lanka St. Lucia 
St. Vincent and the 
Grenadines Sudan Suriname 
Swaziland 
Syrian Arab Republic Tajikistan 
Tanzania 
Thailand Timor-Leste Togo 
Tonga 
Tunisia Turkey Turkmenistan 
Tuvalu 
 
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