EXPORT CREDIT AND FOREIGN INVESTMENTS INSURANCE ACT 78 OF 1957
(Short title, previously 'Export Credit and Foreign Investments Re-insurance Act,substituted by s 9 of Act 9 of 2001)
[ASSENTED TO 24 JUNE 1957] [DATE OF COMMENCEMENT: 12 JULY 1957]
(Afrikaans text signed by the Officer Administering the Government)
as amended by
Export Credit Re-insurance Amendment Act 66 of 1961
Export Credit Re-insurance Amendment Act 88 of 1962
Export Credit Re-insurance Amendment Act 75 of 1971
Export Credit Re-insurance Amendment Act 81 of 1981
Transfer of Powers and Duties of the State President Act 97 of 1986
Export Credit and Foreign Investments Re-insurance Amendment Act 27 of 1988
General Law Amendment Act 49 of 1996
Export Credit and Foreign Investments Re-insurance Amendment Act 9 of 2001
ACT
To promote trade with countries outside the Republic by providing for the insurance on behalf of the Government of the Republic of contracts in connection with export transactions, investments and loans or similar facilities connected with such transactions; and to provide for matters connected therewith.
[Long title amended by s.7(b) of Act 88 of 1962 and substituted by s.6 of Act 81 of 1981 and by s. 12 of Act 9 of 200l.]
1 Definitions
(1) In this Act, unless the context otherwise indicates-'buyer' means a person carrying on business outside the Republic;
'contract of insurance'
[Definition of 'contract of insurance' inserted by s.1(1) (a) of Act 75 of 1971 and deleted
by s. 1(a) of Act 9of 2OOl
'contract of insurance' means a contract of insurance entered into in terms of an agreement referred to in section 2, and includes any amendment thereof if such amendment has, at any time before or after it was made, been approved by the Minister in consultation with the Export Credit Agency;
[Definition of 'contract of insurance', previously definition of 'contract of re-insurance',
substituted by s.1(b) of Act 9 of 2001.]
'Export Credit Agency' means the person contracted in terms of section 2;
[Definition of 'Export Credit Agency' inserted by s.1(c) of Act 9 of 2001.]
'Fund' means the Reserve Fund established under section 5;
[Definition of 'Fund' substituted by s.1(a) of Act 81 of 1981 and by s.1(d) of Act 9 of
2001.]
'investment' means any share or interest in any business undertaking in any country outside the Republic which could promote the exports of the Republic to or the economic development of that country, and which is acquired with the object of earning income;
[Definition of 'investment' inserted by 5. 1(b) of Act 81 of 1981.] 'Minister' means the Minister of Trade and Industry;
[Definition of 'Minister' substituted by s.1(c) of Act 81 of 1981, by s.1 of Act 27 of 1988
and by s. 1 (e)of Act9 of 2OOl.]
‘person' includes any company, association, partnership, individual, government agency or semi-government agency;
'the Territory'
[Definition of 'the Territory' deleted by s.1 of Act 49 of 1996.]
'the Republic'
[Definition of 'the Republic' deleted by s.1 of Act 49 of 1996.] 'this Act' includes any regulation made thereunder;
'trade with countries outside the Republic' includes any transaction (including a transaction for the rendering of a service) involving a consideration in money or money's worth accruing from a person in the course of carrying on business or other activities outside the Republic to a person carrying on business in the Republic and any consignment of goods by a person carrying on business in the Republic to a person carrying on business or other activities outside the Republic with a view to such a transaction.
[Definition of 'trade with countries outside the Republic' amended by s.1 of Act 66 of
1961.]
(2) For the purposes of this Act-
(a) a sale of goods to a person who intends to export such goods from the Republic; and
(b) the sale and consignment of goods (including a transaction for the rendering of a service) from a place or source outside the Republic, if the Minister, in consultation with the Minister of Finance, determines that such sale, consignment or transaction is beneficial for the export trade of the Republic,
shall be deemed to be a transaction in the course of trade with a country outside the Republic in terms of section 2.
[Sub-s. (2) substituted by s.1(1) (b) of Act 75 of 1971.]
2 Agreement for insurance
(1) The Minister shall enter into an agreement with the Export Credit Agency with the object of insuring on behalf of the Government on such terms and conditions as may, in consultation with the Minister of Finance, be prescribed in such agreement, any contracts entered into by persons carrying on business in the Republic, being contracts subject to risk of monetary loss or monetary detriment attributable to circumstances beyond the control of the person suffering the loss or detriment and arising out of or in connection with-
(a) acts or transactions in the course of trade with countries outside the Republic; or
(b) investments in countries outside the Republic; or
(C) any loan or similar facility connected with any such act, transaction or investment and granted by a person carrying on business in the Republic to any person,
for any of the following causes
(i) the operation of a law, or of an order, a decree or regulation having the force of law, which(aa) prevents, restricts or controls the transfer of payments from the
buyer's country or from the country in which the investment was made, to the Republic; or
(bb) prevents, restricts or controls the importation of goods into the buyer's country; or
(cc) prevents, restricts or controls the transfer from the country in which the investment was made to the Republic of dividends and interest in respect of the investment;
(ii) nationalization, expropriation or confiscation; [Para. (ii) substituted by s.2 (b) of Act 9 of 2001.]
(iii) the occurrence of war;
(iv) the occurrence of hostilities, civil war, rebellion revolution, insurrection, or other disturbance outside the Republic;
(ivA) the failure to repay a loan negotiated for purposes of entering into a trading transaction with a person in a country outside the Republic, or to repay a loan negotiated in connection with such transaction; or
(v) such other causes as the Export Credit Agency deems to arise from risks not normally insurable.
[Para. (v) substituted by s.2 (c) of Act 9 of 2001.]
(2) The Export Credit Agency shall be registered as an insurer as contemplated in section 7(1) (a) of the Short-term Insurance Act, 1998 (Act 53 of 1998), and shall in its capacity as a registered insurer and juristic person be subject to the relevant insurance and company laws.
[Sub-s. (2) added by s.2 (d) of Act 9 of 2001.]
(3) Without detracting in any way from the Minister's power to determine through the agreement contemplated in section 2 the terms and conditions in terms of which the Export Credit Agency shall conduct its business, the Minister may appoint members of the Board and the Chief Executive Officer of the Export Credit Agency.
[Sub-s. (3) added by s.2 (d) of Act 9 of 2001.]
(4) The members and Chief Executive Officer contemplated in subsection (3) shall be suitably qualified to perform the functions of the Export Credit Agency.
[Sub-s. (4) added by s.2 (d) of Act 9 of 2001.]
[S.2 amended by s.2 of Act 66 of 1961 and by s.1 of Act 88 of 1962, substituted by s.2 of Act 81 of 1981 and amended by s.2 of Act 2 of 1988 and by ss.2 (a) and 10 of Act 9
of 2001
3 Percentage cover
A contract of insurance shall specify the maximum percentage of the loss, as defined in such contract, which is covered by the indemnity under such contract, and such percentage shall not exceed ninety per cent of the loss as so defined.
[S.3 amended by s.2 of Act 88 of 1962 and substituted by s.3 of Act 9 of 2001.]
4 Premiums
The rate of premium for any contract of insurance shall be fixed by the Export Credit Agency, having regard to the various factors which have a bearing on the risks covered by the contract and to the cost of administering this Act.
[S.4 substituted by s.4 of Act 9 of 2001.] 5 Financial arrangements
(1) The Export Credit Agency shall establish a Reserve Fund into which shall be paid moneys appropriated by Parliament for the purpose of this Act and premiums and other moneys accruing to the Export Credit Agency under contracts of insurance. [Sub-s. (1) substituted by s.3(a) of Act 81 of 1981, by s.3(a) of Act 27 of 1988 and by
s.5(a) ofAct9 of 2001.)
(2) There shall be paid out of the Fund:
(a) all moneys required for the discharge of claims or other liabilities under contracts of insurance;
[Para. (a) amended by s.10 of Act 9 of 2001.]
(b) any remuneration and allowances referred to in sections 7 and 8; [Para. (b) substituted by s.5 (b) of Act 9 of 2001.]
(c) such other costs of administering this Act as may be determined by the Minister in consultation with the Export Credit Agency
[Para. (c) substituted by s.5 (b) of Act 9 of 2001.]
(3) The Export Credit Agency shall from time to time determine the amount in the Fund which shall be kept available for the payment of any claims, liabilities, fees and costs referred to in subsection (2) and the balance of the moneys in the Fund over and above the amount so determined shall be suitably invested by the Export Credit Agency in accordance with the requirements of the Short-term Insurance Act, 1998 (Act 53 of 1998).
[Sub-s. (3) substituted by s.3 (b) of Act 81 of 1981, by s.3 (b) of Act 27 of 1988 and by
s.5(c) of Act 9 of 2001 .]
(4) (a) The Export Credit Agency may from time to time obtain advances from the Minister in order to meet temporary deficits in the Fund.
[Para. (a) substituted by s.5 (d) of Act 9 of 2001.]
(b) Any loss incurred by the Minister as a result of such advances shall be met out of moneys appropriated by Parliament for this purpose.
[Para. (b) substituted by s.5 (d) of Act 9 of 2001.]
(c) The total amount of any such advances which have not yet been repaid shall at no time exceed an amount to be specified in a guarantee to be given to the said Bank by the Minister of Finance.
(d) Any loss incurred by the said Bank as a result of such advances shall be met out of moneys appropriated by Parliament for the purpose.
[Sub-s. (4) added by 5.3 of Act 88 of 1962.]
6……..
[S.6 repealed by s.6 of Act 9 of 2001.]
7 Establishment of committees
(1) The Export Credit Agency shall establish, in consultation with the Minister, a committee which shall evaluate applications for contracts of insurance.
[Sub-s. (1) substituted by s.7 of Act 9 of 2001.]
(2) (a) The members of any committee established under sub-section (1) shall be appointed at such remuneration and allowances and on such conditions as may be determined by the Minister in consultation with the Minister of Finance, and the said remuneration and allowances shall be paid out of the Fund.
(b) A member of any committee referred to in sub-section (1), who is in the full-time employment of the State, shall not receive any remuneration in respect of his services as such a member, and any travelling or subsistence allowance paid to such a member shall be in accordance with the laws governing his employment by the State.
8 Administration of Act
(1) Subject to the provisions of section seven, the Minister shall administer this Act through officers appointed in accordance with the laws regulating the public service:
Provided that the Minister may enter into an agreement with any other person where under that person undertakes to perform any work arising from this Act or from any insurance effected under this Act.
[Sub-s. (1) amended by s.10 of Act 9 of 2001.]
(2) The Minister may in consultation with the Minister of Finance determine the remuneration and allowances to be paid to such other person engaged in terms of the proviso to sub-section (1) in respect of his services, and the said remuneration and allowances shall be paid out of the Fund.
9 Delegation of powers of Minister
Any power which may be exercised under this Act by the Minister alone, may be exercised by any officer in the Department of Trade and Industry deputed thereto by the Minister; and any power which may be exercised under this Act by the Minister in consultation with the Minister of Finance, may be exercised by any officer in the Department of Trade and Industry in consultation with an officer in the Department of Finance respectively deputed thereto by the Minister and the Minister of Finance.
[S.9 substituted by s.4 of Act 81 of 1981 and by s.4 of Act 27 of 1988.] 10 Offences and penalties
(1) Any person who wilfully makes a false or misleading statement in or in connection with a contract of insurance shall be guilty of an offence and liable on conviction to a fine or to imprisonment for a period not exceeding one year, or to both such fine and such imprisonment.
[Sub-s. (1) substituted by s.8 of Act 9 of 2001.]
(2) Whenever any person is convicted of an offence under this Act, he shall forfeit all rights under the contract of insurance in respect of which such offence was committed and the court so convicting him may summarily enquire into and assess the monetary equivalent of any advantage which he may have gained in consequence of that offence, and may, in addition to any other penalty imposed in respect of that offence, impose upon him a fine equal to the amount so assessed and, in default of payment thereof, imprisonment for a period not exceeding six months.
(3) A magistrate's court shall have jurisdiction to impose such additional penalty as is contemplated in sub-section (2), even though such penalty may, either alone or together with any other penalty imposed by that court, exceed the punitive jurisdiction of a magistrate's court.
11 Regulations
The Minister may make any regulations which are not inconsistent with this Act and which he considers necessary or expedient for the achievement of the purposes and objects of this Act.
[S. 11 amended by s.4 of Act 88 of 1962 and by s.46 of Act 97 of 1986.]
12 …….
[S. 12 amended by s.5 of Act 88 of 1962 and repealed by s.1 of Act 49 of 1996.]
13 Short title
This Act shall be called the Export Credit and Foreign Investments Insurance Act,
1957.
[S. 13 substituted by s.5 of Act 81 of 1981.]