Patel backs down, unbans unfettered e-commerce

Trade, industry & competition minister Ebrahim Patel has backed down over government’s ban on unfettered e-commerce during level-4 of the lockdown, handing a stunning victory to an industry that has lobbied hard to have the restrictions removed.

E-retailers are now permitted to sell any goods, with the exception of cigarettes and alcohol, according to regulations published in the Government Gazette on Thursday.

Patel drew sharp criticism in late April when he effectively shot down requests by online traders to allow unfettered e-commerce in South Africa, saying doing so would be seen to be “unfair competition” and risked spreading Covid-19.

Many online retailers, including the country’s largest, Takealot.com, have argued that unfettered online shopping has been allowed in most other countries, including China, during their lockdowns as a way of containing the spread of the novel coronavirus while supporting economic activity.

“If we open up any one category, let’s say e-commerce, unavoidably there’s enormous pressure to do the same for physical stores, for spaza shops, for informal traders, so there is fair competition,” Patel said at the time, earning himself widespread condemnation in the process.

He has now changed his mind.

Regulations published in Thursday’s Government Gazette, which run to more than 25 pages, now allow unfettered e-commerce but set out detailed rules designed to stop the spread of infection.

‘Critical enabler’

The new regulations state: “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.”

They also state that e-commerce is “an important retail platform” but that “appropriate health and safety protocols need to be put in place which can allow the full e-commerce supply chain to operate safely while mitigating the risk of it becoming a vector for transmission of the coronavirus”.

“Greater levels of e-commerce for goods that are normally not for sale in retail stores can introduce increased health risks by greater movement of courier or delivery service personnel, and hence health and safety protocols are important to mitigate this risk.

“To fully leverage the benefits of e-commerce platforms for a greater number of South Africans during the national state of disaster, these directions also recommend increased access for consumers through the provision of multiple payment channels, including for low-income consumers and the promotion of South African-made products.”

E-retailers are directed in the regulations to “give prominence” to products that are made in South Africa.

Among other measures, companies must provide written guidelines for customers on how to safely disinfect goods received before use. Goods must also be sanitised before they leave a warehouse or depot.

Courier and delivery service personnel may not enter the home of a customer if they are not wearing a face mask and must at all times remain at least 1.5m from the courier employees.

The regulations are in force with immediate effect.  — (c) 2020 NewsCentral Media