Transporters brace for costs of Aarto administration

South Africa’s road freight industry is bracing for a massive compliance shift with the upcoming implementation of the Administrative Adjudication of Road Traffic Offences (Aarto) Act, which experts warn will bring operational uncertainty and escalating costs for transport businesses. The subject was a focal point during a panel discussion at the Road Freight Association Convention 2026 in Ballito recently, where experts highlighted the severe financial and legal risks facing operators. Steve Cornelius, a senior consultant at Olea South Africa, warned that the transport sector had not fully grasped the massive financial and insurance exposures on the horizon due to the legislation. “The exposure to risk is going to increase substantially. The minute the insurer, or you as the operations manager, is not aware of what’s going on, you immediately become exposed to a potential repudiation from the insurer,” Cornelius said. He said standard insurance contracts strictly required a valid driver’s licence. Under Aarto, if an operator is unaware that a driver’s licence has been suspended due to accumulated demerit points and an accident occurs, insurers are highly likely to repudiate the claim. “It could be catastrophic for you and your business in a marginalised industry like the logistics industry,” Cornelius added. Project Logistics Management managing director, Carl Webb, expressed deep concern over the administrative and financial burden Aarto places on already distressed transport companies. He warned that businesses would be forced to absorb the costs of monitoring the demerit system themselves. “Now we’re going to have to spend more money to manage ourselves. Surely it’s not our job? They (the Department of Transport) should be updating or advising,” he said. “You probably have to employ somebody, depending on the size of your company. We’ve got 20 vehicles. We will have to employ somebody to just sit and every day, every week, try and access the system, which no doubt won’t work properly. But we have to access the system to see the status, if there are fines outstanding,” he said. “At the end of the day, the industry is already distressed.” According to Statistics SA’s Labour Force Survey, there were 301 000 job losses, of which 30 000 were in the logistics sector, in the first quarter of the year. Webb also raised fears regarding corruption and enforcement on the ground “All that’s going to happen is your bribes are going to double, because it’s his (the driver’s) livelihood. As long as your law enforcement matches the enthusiasm of the introduction of Aarto, we’ll be okay,” Webb said. Panel chair Magretia Brown- Engelbrecht concluded that the transition required an immediate, holistic structural shift by logistics companies rather than a mere update to employee relations policies. She urged operators to prepare well ahead of the final implementation deadline. LC