Legal Aspects

In the last couple of years, the businesses in the global trade observed and experienced many volatilities involving China as they added a set of new trade laws to their legal system. Apart from their Customs Law and Foreign Trade Law, there was no specific legislation addressing export controls previously within China. The new ECL was ratified on 17 October and took effect from 01 December 2020.

In a snapshot, an ECL is a standard international practice. It consists of regulations limiting or preventing certain exports from gaining control over a country’s consumption patterns. It is also formulated to align with other national policies such as foreign trade, economic, security, environment and military.

Existing and budding businesses in the export industry need to understand the core principles of the new ECL when trading with China

• The ECL applies to the export of dual-use goods, military goods, nuclear goods,technologies and services and other goods and services associated with national security matters and anti-proliferation responsibilities. These are listed as controlled goods.
• It requires exporters to apply for licenses to export the controlled goods where they will have to meet multiple criteria classified by the licensing authorities.
• Exporters should provide documents validating and explaining the end-user and end-use of the controlled goods to the Chinese State Export Control Administration.
• Authorities can use the ECL to force export bans for controlled goods from particular countries, regions, companies or individuals if they threaten national security.
• It applies to the procurement of controlled goods by Chinese entities and individuals to foreign entities and individuals inside or outside the country.

China faces challenges in the practical utilisation and administration of the ECL and ts integration with the existing legal system. There is also a demand for further direction, detailed interpretation requirements from international businesses.Exporters trading with China are highly recommended to conduct comprehensive research and evaluation of prerequisites and ramifications of the new ECL. It is also necessary to understand how the ECL facilitates managing risks and opportunities of exporting to China.

China has a reputation for having a conspicuously intricate compliance system.International businesses should pay attention to the regular developments and deviations of the ECL to ensure their transactions with China are faultless.

AfCFTA is the newest pendulum of the global FTA network, considered to mould Africa’s economic potential. It intends to trigger GDP growth, raise employment, and stabilise economies across the African continent, creating a single African market for goods and services.

AfCFTA requires the member countries to exclude 90% of tariffs, granting free access to merchandise, goods and services. It also simplifies customs procedures and advances further by the movement of white-collar and blue-collar workers, healthy competition, intellectual property and investments. A recent publication from Baker Mckenzie stated that, as of April 2021, AfCFTA has 36 countries sanctioned with their agreement and 54 countries in Africa have signed the agreement, with Eritrea being the only nonsignatory party.

Trading under AfCFTA activated from 1 January 2021. It is acknowledged as a timely reinforcement to encourage intra-continental trade and enhance inter-continental collaboration in a period of increasing seclusion.

The agreement is already making headway and headlines. For example, South Africa is among the first to harvest the benefits by combining its solid manufacturing base and substantial networks across the continent with AfCFTA terms. Similarly, smaller countries such as Ghana and Côte d’Ivoire are seeing a rapid improvement in trade thanks to their open economies, favourable business environment and top-grade infrastructures.

AfCFTA recognises the lack of competent leadership and trade support as critical factors and aims to address them continuously. According to Ghanaian President Nana Akufo-Addo, the COVID-19 pandemic has amplified the significance of the AfCFTA’s success more than presumed.

Some of the significant challenges that AfCFTA faces are lacking proper infrastructure, inferior trade logistics, regulatory constraints, uncertainty in financial markets, regional warfare and intricate customs processes. These can affect trade development more than imposing tariffs. In the aftermath of COVID-19, these challenges can be subdued but only with more major trade and support.

If everything works smoothly and AfCFTA unlocks its truest potential, the proposed benefits would spread globally. For example, defeat poverty in Africa, improve the export portfolio, attract FDIs, expedite economic growth, enrich women’s lives, and promote the concept of “Trade Integrity” by ensuring authenticity and transparency of transactions. According to the World Economic Forum, AfCFTA is becoming the global vanguard that demonstrates what can be accomplished with robust decision
making and forward-thinking