A M Moolla Group Limited and Others v The Commissioner for the South African Revenue Service and Others

The appellants imported garments from Malawi and claimed exemption from South African customs duty under a 1990 bilateral trade agreement between South Africa and Malawi, incorporated into the Customs and Excise Act 91 of 1964. Article 6(ii) of the agreement required that at least 25% of the 'production cost' of goods manufactured in Malawi be represented by Malawian materials and labour. The dispute concerned whether 'production cost' should be given its ordinary meaning, as contended by the appellants, or whether it had to be calculated in accordance with section 46 of the Customs and Excise Act and Rule 46, as contended by SARS. It was common cause that the goods would qualify for exemption only if the appellants’ interpretation was correct.

The appeal was dismissed with costs, including the costs of two counsel. The goods imported by the appellants did not qualify for exemption from customs duty.

The case clarifies that international trade agreements incorporated into South African legislation must be interpreted as part of the statute and in conformity with its definitions and rules. It affirms the primacy of statutory interpretation over administrative practice in customs matters and reinforces limits on executive power in concluding trade agreements.