South African exporters must collaborate to pursue international markets under the Block Exemption for Promotion of Exports, which provides for specified categories of collaboration in export markets that are exempt from certain provisions of the Competition Act.

These categories include opportunities for qualifying exporters to achieve economies of scale and efficiencies, share certain landed costs, export-related infrastructure and market information, coordinate logistics, collectively market South African goods and jointly negotiate or contract with foreign buyers, where permitted.

The exemption is a direct policy response to deteriorating global trade conditions, including the imposition of broad-based tariff increases by key trading partners, rising logistics costs and increased complexity in accessing alternative export markets, says Department of Trade, Industry and Competition (dtic) export development and support director Kwanele Mkhwanazi.

“South Africa's exports are still largely driven by larger firms, while smaller businesses remain less active in international markets. The opportunity before us is to help businesses enter, compete, retain and grow in these markets.

“A single company may struggle with the cost of areas like market research, overseas warehousing, logistics and international marketing. However, collectively, there may be opportunities to share certain costs and activities, where permissible under the regulations,” he says.

South African companies must broaden and strengthen the export ecosystem, identify and understand the opportunities available to them and help to grow the economy, the dtic suggests.

Export councils, industry associations and provincial export-support agencies have an important role to play in identifying such opportunities, given their knowledge of businesses and sector-specific challenges, he says.

Further, the block exemption adds to the broader support available to exporters, including the dtic Export Help Desk, export councils and provincial partner networks, market intelligence, training, coaching and mentorship, incubation and acceleration programmes, business-to-business matchmaking, and the dtic Export Marketing and Investment Assistance market-access support.

The dtic and the Competition Commission encourage exporters and export-support formations to familiarise themselves with the requirements and limitations of the block exemption before entering into collaborative arrangements.

The exemption applies to qualifying activities within its scope and does not provide a blanket exemption from competition law, it asserts.