The number of complaints of illegal vehicles being sold in South Africa has increased substantially in the last two years.
This is according to the Executive Director of the International Vehicle Identification Desk (IVID) Lee Dutton.
In order to protect the interests of local manufacturers and car dealerships, South Africa restricts the sale of used cars from foreign countries.
However, these cars are often sold illegally to unwitting buyers.
Once the authorities have identified such a vehicle, it is confiscated and destroyed, leaving the buyer with no compensation.
Asia and Europe’s rejects
The vehicles in question are often referred to as “grey models” and primarily come from European and Asian countries, many of which have laws that dictate a certain number of years for which a car may legally be used on its roads.
After this period, the cars are either destroyed or shipped off to be sold in African countries at extremely cheap prices.
The cars come South Africa’s coastal ports of entry to reach these destinations.
Dutton explained that instead of being transported to other countries from there, these vehicles often end up being used on South African roads.
“The majority of used vehicle imports into the region come through Durban, but it is the onward movement after leaving the port that is an issue, they may or may not arrive at their destination country, but even so they can be driven back to RSA and remain,” Dutton explained.
To legally import a used vehicle from another country, an appropriate permit is required, in addition to a payment of customs tax as determined by SARS.
These requirements are not fulfilled for many of these vehicles, which are sometimes fraudulently registered on South Africa’s national vehicle registration system – eNaTis.
Rise in reported cases
Dutton said IVID has recorded a four-fold rise in complaints about attempts that were made to sell illegally-imported vehicles in South Africa.
He stated that although IVID does not possess the complete figure for cars that were confiscated in 2019, the organisation is aware of well over 1,000 verified seizures.
The actual figure is likely much higher, as these are only the cases logged with IVID.
A report from The Sunday Times early in 2019 claimed that SARS and the police confiscate around 20,000 illegally-imported vehicles every year.
Dutton said the problem was so extensive that SARS warehouses have been inundated with vehicles ultimately destined for crushing.
“SARS have filled their state warehouses to capacity with illegal vehicles and are pushing them through their processes so that they can be disposed of,” Dutton said.
“The biggest increase is with vehicles having foreign plates ‘living’ in RSA, this has been caused by poor border control record-keeping and piecemeal law enforcement on the roads,” Dutton stated.
Dutton further claimed that during Tom Moyane’s stint as SARS Commissioner, little was being done to tackle the smuggling problem.
Since his departure, however, SARS has been “far more aggressive” on illegal imports, he said.
MyBroadband contacted the SA Police Service and SARS for comment but did not receive a response by the time of publication.
The biggest problem
Dutton blamed the removal of the vehicle control system in eNaTis as the biggest cause of the problem.
The management of eNaTis had been the prerogative of Tasima, which was originally contracted to develop, operate, manage, and control the system from 2001 to 2006.
The intention was that the system would be transferred to the Department of Transport’s Road Traffic Management Corporation (RTMC) after five years, but due to various disputes and delays around contracts, Tasima kept control for several years after 2006.
The Constitutional Court ordered that eNaTis control be handed over to the government in 2015. A legal battle over the time frame for the transition ensued, and RTMC eventually got control of the system in 2017.
The RTMC stopped using Tasima’s pre-existing control system, which Dutton said was “undoubtedly the catalyst for the recent increase of illegal registrations in this space”.
Why illegal grey models are a problem
Cheap grey models can undercut the sale of vehicles from local dealers and manufacturers.
“We have a local manufacturing base, if we allowed the dumping of Japan’s used cars into our market there would be no local industry within months,” Dutton said.
In addition to the effects these cheap vehicles would have on the local motoring industry, Dutton explained that there are a number of enforcement-related issues with having these vehicles in South Africa.
“By driving a foreign-plated vehicle you avoid fines, road tax and e-tolls,” Dutton said. “Every nation has to control and tax its road users, vehicles must be traceable from a law enforcement perspective.”
MyBroadband asked one of the top-selling vehicle manufacturers in South Africa – Toyota – about the effects of illegal imports on its business.
Toyota South Africa would not comment on exact figures, but it said it was aware of an increase in illegally-imported vehicles.
“All manufacturers are negatively affected when illegal vehicles are sold or operated locally. By extension, this also has an indirect impact on the automotive industry as well as the local economy at large,” Toyota said.
The company advised that customers be extra vigilant when purchasing foreign-registered vehicles, even more so when the seller promises to only provide the import documentation at a later date.
To avert the possibility of having your car confiscated for being an illegal import, Toyota said there are a number of signs to look out for.
First off, if the purchase price is too good to be true, this should signal danger.
“Low pricing is the easiest giveaway – and this could mean that the vehicle is stolen or illegally imported,” Toyota said.
Additionally, the company noted a number of physical car features which should raise suspicion.
“In the case of Toyota, Japanese stickers on the windows, but typically unusual mirror configurations, and maintenance documents showing its foreign origins are the best indicators.”
What to do
IVID monitors the movement of imported cars, particularly through Durban Harbour and into Southern Africa, to determine if imported vehicles that are being used on South Africans roads have cleared the necessary tax requirements.
It has the ability to identify the international trafficking of stolen and illegal vehicles and alerts authorities such as SARS and the police about misrepresentations, misdescription, and fraudulent activities in vehicle crime.
If you suspect an advertised vehicle is an illegal import or stolen vehicle, you can report it to IVID by calling them on 033 234 4083 or sending an email to [email protected]