Wine industry consultant Gert Bormans ran up against this little legislative requirement recently. “I consult to a major wine producer, that formed a joint venture company late last year, with foreign interests, to export wine to the Far East,” Mr Bormans says. “When the new company applied to the Department of Agriculture [Forestry and Fisheries] (DAFF), for an export certificate, we were told that the exporting company must produce its liquor license.”
The problem is that the newly formed company did not yet have a liquor license nor did it make sense that it ought to have one, according to Mr Bormans. “The new company was formed solely to export wine to the Far East. It will not be selling locally, so it never applied for a liquor license. I fail to understand why a liquor license is even needed,” Mr Bormans said. “
The law changed some time back, and it is now being enforced, according to liquor industry legal boffin Danie Cronje of Cluver Markotter in Stellenbosch. “Any institution that is registered as either a manufacturer or distributor of liquor products, may only sell liquor products to an institution that has a liquor license,” Mr Cronje says, “in terms of the National Liquor Act (Act 59 of 2003). In addition, in terms of the Western Cape Liquor Act (Act 4 of 2008), no more than 150 litres of liquor may be sold to any person or institution, that does not possess a liquor license. That provision is up for revision, but that has not happened yet as far as I know.”
The issuing of an export certificate by DAFF, required in terms of the Liquor Products Act (Act 60 of 1989), is not dependent on the exporter actually producing a liquor license, according the DAFF administering officer of the Act, Wendy Jonker. “As long as the applicant can produce acceptable proof of having applied for a liquor license, DAFF will issue an export certificate,” says Ms Jonker, speaking from her Stellenbosch office. “All DAFF staff who work with export certificates ought to be aware of this provision.”
Gert Bormans’ client took the route of exporting the consignment under the auspices of the wine producer that originally sold the wine to the exporting company, since it had the required liquor license, and was therefore able to acquire an export certificate. “The next consignment will go out under the auspices of the export company which has now applied for the necessary liquor license” says Mr Bormans, adding that aside from the complexity of the legislation, the bureaucracy is pursuing the right goal for the wrong reasons, and it is costing the country.
“I’m sure that the legislation and regulations are enacted with the best of intentions, but to what end? The bureaucracy is running around trying to create the perfect country, but in the process is constraining business, and contributing to unemployment,” says Mr Bormans. “It’s like the recent Home Affairs saga, with the visa and unabridged birth certificate regulations - again enacted with the best of intentions - that had such a severe impact on the tourism sector.”
In summary therefore, if you are a liquor exporter, you must either be registered with the national liquor authority as a manufacturer or distributor, or have a liquor license issued by a provincial liquor authority, or have acceptable proof of having made such application, in order to acquire an export certificate.