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Doing business in South Africa

South Africa is a country of contrasts, and as other emerging economies it has a complex market environment - But the challenges do not overshadow the rewards from succeeding in South Africa. Read here about some of the challenges you should be aware of in the South African market.

Regulations and rewards

The Trade Council advices you to pay attention to the country-specific conditions that characterise the South African market

B-BBEE
In order to redress South Africa’s apartheid past, the B-BBEE legislation was adopted in 2003. Its objective is to advance the economic transformation through the increased economic participation of black people in the South African economy. Despite the measures taken over the past years, the B-BBEE legislation has not yet sufficiently transformed the South African economy. The policies are therefore currently being reviewed, which might bring forth changes in the near future. It is important for Danish companies intending to enter the South African market to be aware of the B-BBEE legislation and its effect within the South African business environment. Therefore, the Trade Council at the Embassy follows any developments pertaining to B-BBEE closely and assists Danish companies in understanding and evaluating when B-BBEE compliance should be sought.

LCR- Local Content Requirements
When approaching public tenders in South Africa, certain sectors contains requirements towards the adherence to local production measures. LCR means that the state and state-owned businesses are only allowed to accept proposals, which are rooted in national produced goods, services and labour.

We encourage you to contact us, should you be interested in knowingmore about LCR.

Market barriers

A new feature - "anmeld handelsbarrierer" - has been added to the website of the Trade Council. On the site, Danish companies may report and register barriers facing Danish goods, services and investments in export markets outside of the EU.

Use of the facility is free of charge. The Embassy can assist in registering barriers if so desired. The barriers registered should obviously be barriers in the South African market. The Embassy can further assist - as in accordance to the normal TC fee structure - in solving concrete trade barriers for Danish companies if so requested.
You can report a trade barrier online by clicking here.

 Business culture

Personal relations are important to South African, and they appriciate meeting their partners in person. The business culture is more hierarchy than in Danish companies, and especially when meeting government officials it is a good idea to familiarise with your meeting partners position and use their right title in emails. South Africa is still fairly scared from Apartheid, and some companies might be negatively tuned towards foreign companies, as they are seen as taking business from local firms. Also, race and racism is still a major challenge in South Africa and a tense topic, hence it is good to be aware of this tension, and that it is easier to offend racial groups in South Africa than in Denmark.  However, the South Africans are often very open and forthcomming and most companies are professional and open to strong Danish solutions.