South Africa - International Franchise Association

Performance Requirements and Incentives Return to top
DTI offers several investment incentives for manufacturing:
• The Business Process Outsourcing & Off-Shoring (BPO&O) investment incentive
comprises an Investment Grant ranging between R37,000-R60,000 ($5,400-
$8,800 U.S.) and a Training Support Grant towards costs of company specific
training up to a maximum of R12,000 ($1,765 U.S.) per agent. The incentive is
offered to local and foreign investors establishing projects that aim primarily to
serve offshore clients. The objective of the incentive is to attract BPO&O
investments that create employment opportunities. The grant is provided directly
to approved projects depending on the value of qualifying investment cost and
employment creation.
• The 12i Tax Incentive is designed to support green field investments (i.e. new
industrial projects that utilize only new and unused manufacturing assets), as
well as brown field investments (i.e. expansions or upgrades of existing industrial
projects). The 12i incentive is available for investments with a total value of more
than R1.6 million ($235,000 U.S.).
• The Manufacturing Investment Program offers local- and foreign-owned entities
an investment grant of up to 30 percent of the value of qualifying investment
costs in machinery, equipment, commercial vehicles, land and buildings, required
for establishing a new production facility; expanding an existing production
facility; or upgrading production capability in an existing clothing and textile
production facility.
• The Sector Specific Assistance Scheme (SSAS) is a reimbursable cost-sharing
grant whereby financial support is granted to Export Councils, Industry
Associations, and Joint Action Groups. Export Councils represent the trade
promotion efforts of specific industries, while Industry Associations are trade
associations that represent sectors that are prioritized for development by DTI.
Joint Action Groups are groups of companies or associations that seek to
cooperate on one-time projects in sectors prioritized for development by DTI.
Foreign companies can access SSAS funding through participation in one of
these entities.
• The Film and Television Production Rebate Scheme encourages foreign and
domestic investment in the local film industry. Eligible applicants may receive a
rebate of 15 percent of the production expenditures for foreign productions and
up to 25 percent for qualifying South African productions. Film projects must
have begun after April 1, 2004 and investment in the film must reach a threshold
of R25 million ($3.67 million U.S.) to qualify for the rebate. Other requirements
include 50 percent completion of the principal photography in South Africa and a
minimum of four weeks' local photography time. Eligible productions include
movies, television series, and documentaries. The maximum rebate for any
project will be R20 million ($2.9 million U.S.).
• To encourage investment in the automotive sector, the Automotive Investment
Scheme was announced in June 2010 as part of the Automotive Production and