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Trade, Development and Cooperation Agreement (TDCA)

The European Union and South Africa have concluded a bilateral agreement covering trade relations, development cooperation, economic cooperation and numerous other fields such as socio-cultural cooperation and political dialogue.

ACT

Council Decision 2004/441/EC of 26 April 2004 concerning the conclusion of the Trade, Development and Cooperation Agreement between the European Community and its Member States, on the one part, and the Republic of South Africa, on the other part [See amending acts].

SUMMARY

The European Union (EU) and South Africa have concluded an agreement on trade, development and cooperation (TDCA), designed to strengthen cooperation in various fields.
This Agreement pursues several objectives: strengthening dialogue between the parties, supporting South Africa in its economic and social transition process, promoting regional cooperation and the country's economic integration in southern Africa and in the world economy, and expanding and liberalising trade in goods, services and capital between the parties.

Based on respect for democratic principles, human rights and the rule of law, the Agreement establishes a regular political dialogue on subjects of common interest, both at bilateral and regional level (within the framework of the EU's dialogue with the countries of southern Africa and with the group of the African, Caribbean and Pacific (ACP) countries).

The duration of the Agreement is unspecified, but provision is made for its revision within five years of the date of its entry into force in order to consider possible amendments.

The Agreement covers a number of areas and includes a future developments clause making it possible to widen the field of cooperation.

TRADE

The TDCA establishes preferential trade arrangements between the EU and South Africa, with the progressive introduction of a Free Trade Area (FTA). The EU is South Africa’s main trading and investment partner. The FTA aims to ensure better access to the Community market for South Africa and access to the South African market for the EU. As a result, it plays an important role in South Africa's integration into the world economy. The Agreement covers around 90 % of current bilateral trade between the two parties.

The Agreement provides for the liberalisation of 95 % of the EU's imports from South Africa within ten years, and 86 % of South Africa's imports from the EU in twelve years. In order to protect the vulnerable sectors of both parties, certain products are excluded from the FTA and others have been only partially liberalised. For the EU, these are mainly agricultural products, while for South Africa, they are industrial products, in particular certain motor vehicle products and certain textile and clothing products. However, since December 2006 there has been provision for a strengthening of trade liberalisation in the motor vehicle sector.

The Agreement sets out detailed rules of origin in order to ensure that products benefiting from the preferential arrangements come only from South Africa or the EU. To take account of modern international production processes, special provisions make the rules of origin more flexible.

South Africa and the EU may implement safeguard measures when an imported product threatens to cause serious injury to the national industry. The Agreement also allows South Africa to adopt transitional safeguard measures (for example, an increase or reintroduction of customs duties). In addition, similar measures make it possible to protect the economies of members of the Central African Customs Union and the outermost regions of the EU (such as Reunion).

The Agreement includes provisions aimed at avoiding abuse by firms with a dominant position on the market and thus ensuring free competition among the companies from the EU and South Africa. Cooperation takes place within the framework of consultations between the competent authorities. In addition, the EU provides technical assistance to help South Africa restructure its competition laws. The Agreement also recognises the need to provide adequate protection for intellectual property and provides for urgent consultations, where necessary, and technical assistance for South Africa.

Lastly, the TDCA provides for close cooperation in a wide range of fields linked to trade, including customs services, the free movement of services and capital, and technical obstacles such as certification and standardisation.

DEVELOPMENT COOPERATION

EU development aid for South Africa is mainly implemented from the Community budget through the financing instrument for development cooperation (DCI). For the period 2007–13, the DCI has a budget of €980 million for South Africa.

The indicative programme for cooperation with South Africa for 2007–13 indicates two areas on which attention should be focused: job creation in the informal economy sector and integration into the formal economy, and capacity-building for the provision of basic social-security services and social cohesion.

As with other development cooperation agreements, decentralised cooperation is a key element of assistance, thus requiring a high degree of civil society involvement in the development process.

ECONOMIC COOPERATION

Both parties are stepping up their economic cooperation in many fields such as industry (in order to facilitate the restructuring of South African industry), the information society, the creation and development of small and medium-sized enterprises, transport and energy. Cooperation in this field should also support sustainable development in their economies and protect the environment.

OTHER ASPECTS

The provisions of the Agreement cover cooperation in fields as diverse as:

  • social cooperation, based on dialogue covering a number of aspects, such as freedom of association, workers' rights, children's rights, gender equality and violence against women;
  • cooperation to protect the environment, particularly as regards climate change;
  • cultural cooperation;
  • cooperation in the fight against drugs and money laundering;
  • cooperation in the field of health and, in particular, the fight against AIDS.

Lastly, the TDCA contains some institutional provisions. It creates a Cooperation Council to ensure the smooth operation of the Agreement. And it provides for regular contact between the parties; for example, between their Parliaments and between the EU's Economic and Social Committee and its South-African counterpart, the National Economic Development and Labour Council.

BACKGROUND

Signed on 11 October 1999 in Pretoria, the TDCA entered fully into force on 1 May 2004. However, some provisions which fall within Community competence have been applied since 1 January 2000.

The Agreement is supplemented by three additional agreements: the Science and Technology Agreement, and the Wine and Spirits Agreements. The Fisheries Agreement envisaged under the TDCA has not been concluded. South Africa also has qualified membership of the Cotonou Agreement, which governs the relations between the EU and ACP countries.

REFERENCES

ActDate of entry into forceDeadline for transposition in the Member StatesOfficial Journal
Decision 2004/441/EC
[adoption: assent AVC/1999/0112]

26.04.2004

-

OJ L 127, 29.04.2004

Trade, Development and Cooperation Agreement (TDCA)

01.01.2004

-

OJ L 311, 04.12.1999

Amending Act(s)Date of entry into forceDeadline for transposition in the Member StatesOfficial Journal
Decision 2006/166/EC

21.12.2005

-

OJ L 57, 28.02.2006

RELATED ACTS

Proposal for a Council Decision of 4 February 2008 on the signing of an Agreement between the European Community and its Member States, of the one part, and the Republic of South Africa, of the other part, amending the Agreement on Trade, Development and Cooperation [COM(2008) 50 – Not published in the Official Journal].
The Commission proposes an enlargement of the scope of cooperation provided for in the TDC agreement. The new areas of cooperation should contribute in particular to the effective implementation of the socio-economic programme of the African Union. The partners commit to pursue their efforts to achieve the Millennium Development Goals (MDGs). Cooperation should extend to energy policy in order to ensure stability of prices, security and diversification of sources of supply, the development of science, technologies and the information society, and the sectors of beneficiation of minerals, transport and satellite navigation systems.

The agreement includes provisions on international justice and the International Criminal Court. It refers to the application of international instruments for disarmament and the non-proliferation of weapons of mass destruction. It also provides for stepping up cooperation in the fight against terrorism and its financing, organised crime, the prevention of mercenary activities and the eradication of small arms trading. It provides for in-depth political dialogue on the question of migration, so as to reduce illegal immigration, ensure full respect of human rights and the elimination of discrimination.

Discussions on trade and trade-related issues will take place in the context of the negotiations on an Economic Partnership Agreement (EPA).

Communication of 28 June 2006 from the Commission to the Council and to the Representatives of the Governments of the Member States meeting within the Council to give orientation to the Commission for the revision of the Agreement on Trade, Development and Cooperation between the European Community and its Member States, of the one part, and the Republic of South Africa, of the other part [COM(2006) 348 final – Not published in the Official Journal].
This communication, adopted parallel to that proposing a strategic partnership between the EU and South Africa, identifies which parts of the TDCA should be examined with a view to possible amendments. Following this communication, in November 2006 the Council adopted the negotiating mandate and the EU-South Africa Cooperation Council of 14 November 2006 agreed to launching the negotiations to revise the TDCA. These negotiations were concluded on 10 October 2007.

Council Regulation (EC) No 1747/2000 of 7 August 2000 amending Regulation (EC) No 2793/1999 on certain procedures for applying the Trade, Development and Cooperation Agreement between the European Community and the Republic of South Africa [Official Journal L 200, 08.08.2000].
The Regulation amends the annex to Regulation (EC) No 2793/1999 to bring it into line with Commission Regulation (EC) No 2204/1999 on the tariff and statistical nomenclature and on the Common Customs Tariff. In this respect, it amends the codes of the combined nomenclature of the annex in question.

Council Regulation (EC) No 2793/1999 of 17 December 1999 on certain procedures for applying the Trade, Development and Cooperation Agreement between the European Community and the Republic of South Africa [Official Journal L 337, 30.12.1999].
The Regulation establishes, in particular, the arrangements for the implementation of the Agreement's trade provisions, for example, the criteria for the calculation of customs duties, etc. The Commission is responsible for the implementation of the Regulation and is assisted by a Customs Code Committee.

Last updated: 10.03.2009
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