Global Trade Alert

On 27 October 2009, the South African Reserve Bank issued Exchange Control Circular No. 13/2009 that liberalised exchange controls. The circular proposes reforms to reduce red tape by, among others:

• Allowing South African companies to invest in Southern African Development Community member states through offshore intermediaries;
• Increasing tenfold the current limit for outward investment, from 50 million rand (US$ 4.86 million) to 500 million rand (US$ 48.65 million);
• Removing the requirement for companies to convert their foreign exchange into rand - but the obligation to repatriate export proceeds remains for South African companies;
• Allowing South African companies to open foreign bank accounts without prior approval;
• Replacing the paper-based system of export monitoring by an electronic one.

In addition, individuals are allowed to hold more foreign capital, and some restrictions on access to domestic credit by foreigners have been removed.