Government lifts ban on e-commerce after DearSA campaign
DearSA welcomed Trade and Industry Minister Ebrahim Patel’s gazetting of new regulations today (Thursday 14 May 2020) allowing for all e-commerce transactions to take place, with the exception of restricted goods – notably cigarettes and alcohol.
This follows a campaign launched a week ago by DearSA in which it urged the minister to lift the restrictions on e-commerce, failing which it would have no option but to approach the courts for urgent relief.
DearSA requested a response from government by the end of Thursday, 14 May 2020.
“The announcement from Minister Patel is welcome and demonstrates government’s responsiveness to the voices of ordinary South Africans, who have been calling for e-commerce to be opened up without restrictions,” says Daniel Eloff of attorneys Hurter Spies, which is representing DearSA. “As the lockdown progresses, South Africans are understandably concerned at the impact it is having on their lives and on the economy, and we know this because of the surveys conducted on a regular basis by DearSA. There is growing frustration at the needless harm that is being done to the economy and small businesses by the extension of the lockdown to e-commerce platforms, the relaxation of which cannot possibly help in curbing the spread of the virus.”
Major boost for small businesses
Eloff says the lifting of the ban is a major boost for small businesses which – though they may be limited in terms of their physical interaction with customers – can at least now trade online to rescue their businesses.
The Government Gazette notice issued today says “e-Commerce can be a critical enabler to opening the economy through contactless transactions, which can reduce the movement of consumers, and the density of shoppers in retail spaces. Further it can accelerate innovation, support local manufacturing and increase access by the informal market and poorer South Africans.”
Eloff notes that this is precisely the intent and the wording of DearSA’s letter delivered to the Minister a week ago.
In terms of the regulations, online retailers are required to provide for as many payment options as possible for consumers, to reduce the risks of transmitting the virus, and to enable poorer consumers to access delivery services.
The regulations also specifically mention courier services for spaza shops and informal traders, so as to provide online shopping opportunities for customers in poorer areas.
Health and safety requirements
The Gazette notice imposes strict health and safety requirements on companies engaged in e-commerce, which includes screening of workers, the obligation to wear masks, workplace sanitation, and social distancing. Customers receiving goods from couriers are also required to wear masks.
Overkill
DearSA’s campaign to the government referenced several economic studies, some of them by government itself, show that a prolonged lockdown will have a devastating impact on the economy, with the construction sector likely to suffer a 30% decline in employment. A study by SA-TIED suggests the financial and manufacturing sectors are likely to experience a 15% decline in employment if the lockdown is prolonged.
The effect of the lockdown will be a massive decline in the demand and supply of many industries, with particularly severe effects in the service sectors, such as restaurants, entertainment, tourism, travel and hotels.
“While this is a welcome move by the government, we cannot assume that the economy will automatically right itself,” says Eloff. “Huge damage has already be done and urge government to further ease restrictions on economic activity while maintaining vigilance over the spread of the virus. However, we are now at the point where the lockdown is likely to result in many more deaths through poverty and other causes than through the virus itself. We have to get the country back to work.”