n SA Mercantile Law Journal = SA Tydskrif vir Handelsreg - Gradual relaxation or gradual tightening of exchange controls? A review of South Africa's obligations under Article VIII(2) of the IMF Articles




Since the dawn of democracy in South Africa, the policy on exchange control bandied about by the government has been one of gradual relaxation of exchange controls. If recent legal developments are anything to go by, though, it can no longer be asserted with any degree of certainty that the government intends continuing this policy of gradual relaxation. The uncertainty has become more apparent from the decisions in (); () and, perhaps most worryingly, from the recent amendment to regulation 10(1)() of the Exchange Control Regulations (the regulations), dated 8 June 2012. The amendment to regulation 10(1)() has the effect that the term 'capital', for the purposes of that regulation, will now include any intellectual property right, whether registered or unregistered. The unfortunate implication of this amendment is that transfers of intellectual property rights from a South African resident to a non-resident abroad will not be allowed, unless prior Treasury approval is obtained. This result affects South Africa's obligations under the Articles of Agreement of the International Monetary Fund (IMF).


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