An IDZ is a purpose-built industrial estate linked to an international sea or air port that leverages fixed direct investments in value added and export-oriented manufacturing industries.
The aim of the IDZ programme
IDZ are intended to promote the competitiveness of the manufacturing sector and to encourage beneficiation of locally available resources. The support could either be a turn-about strategy to attract investment or be a national programme for economic development to increase exports and competitiveness of South African products.
Key objectives of the programme
- Attract foreign direct investment (FDI);
- Attract advanced foreign production and technology methods in order to gain experience in global manufacturing and production networks;
- Develop linkages between domestic and zone-based industries;
- Provide world-class industrial infrastructure.
Benefits of the incentive scheme
- A Customs Controlled Area (CCA) with dedicated South African Revenue Services (SARS) officials to provide support for customs and VAT requirements;
- World-class industrial support infrastructure;
- Links to an international port of entry;
- Duty suspension on imports for production-related raw materials, including machinery and assets used in production with the aim of exporting the finished products;
- VAT exemptions under specific conditions for supplies procured in South Africa.
Restrictions on the incentive scheme
- All activities, and the manufacture of all goods in contravention of any South African Act shall be prohibited within an IDZ. Contraventions shall attract the penalties prescribed by law;
- No person or company shall bring into, or cause to be brought into, an IDZ a substance or good, the possession of which is considered illegal or illicit or items prohibited by the laws of South Africa or binding international conventions to which South Africa is a signatory;
- Enterprises who wish to manufacture goods, the manufacture of which requires special permits, license or legislative consent, shall acquire such special permit, license or legislative consent prior to the commencement of production and shall disclose their intention to manufacture such goods in their IDZ enterprise agreement.
Application for the IDZ designation
- Interested parties may approach the Minister to apply for a specified area linked to a sea or air port with customs facilities to be considered as an area suitable for the development of an Industrial Development Zone;
- The application must contain the information set out in the guidelines;
- The application for designation must be accompanied by an application for an IDZ operator permit by the intended company for the area proposed for development;
- The Minister may request additional information from the applicant when considering the application.
Applying for an IDZ permit
- Any party interested in obtaining an IDZ operator permit shall, in the prescribed manner, submit a completed IDZ operator permit application to the Minister;
- In case of a new IDZ, the application for an IDZ operator permit must accompany the application for designation of an area for which the IDZ Operator permit is sought;
- In case of an existing IDZ, the provisions regarding transfer of an IDZ Operator permit must be complied with.
An applicant for an IDZ operator permit must:
- Demonstrate control of the land within an existing IDZ or within the area under application designated for development as an IDZ or within a new IDZ pertinent to its application in the detail and manner as indicated in the guidelines ;
- Submit a comprehensive feasibility study in the detail and manner as indicated in the guidelines ;
- Indicate its ownership structure through the submission of a shareholders' agreement of the intended IDZ Operator indicating shareholders, percentages of shareholding, requirements for transfer of shares, requirements for distribution of assets upon liquidation or deregistration;
- Comply with such other criteria and prerequisite procedures as set out in the guidelines to this programme;
- Each applicant shall submit four (4) copies of the application to the Minister, one (1) copy of which must be an original;
- The Minister shall be entitled to return incomplete applications to applicants for subsequent completion or request further information regarding an applicant's application prior to its consideration by the Minister. For more information contact:
Richards Bay Industrial Development Zone Company (PTY) LTD
11 Haiti Mall, Lira Link Road (Opp. Bay Hospital)
Richards Bay
PO Box 712,
Richards Bay
3900
Tel: +27 (0) 35 789 3400
Fax: +27 (0) 35 789 3414
Email: info@richardsbayidz.co.za
Website: www.richardsbay.co.za