Electronic Communications Security (Pty) Ltd Bill: Hearings; National Strategic Intelligence Amendment Bill And Intelligence Services Bill: deliberations

Intelligence Legislation

29 November 1999
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Meeting report

INTELLIGENCE LEGISLATION AD HOC COMMITTEE
14 October 2002
ELECTRONIC COMMUNICATIONS SECURITY (PTY) LTD BILL: HEARINGS; NATIONAL STRATEGIC INTELLIGENCE AMENDMENT BILL AND INTELLIGENCE SERVICES BILL: DELIBERATIONS

Acting Chairperson:
Mr L Landers (ANC)

Relevant documents
Intelligence Service Control Amendment Bill [B50-2002]
National Strategic Intelligence Amendment Bill [B51-2002]
Electronic Communications Security (Pty) Ltd Bill [B59-2002]
Telkom Submission
Proposed Amendments to National Strategic Intelligence Amendment Bill (Appendix 1)
Transtel Submission on Electronic Communications Security Bill (Appendix 2)
Submissions by Grant Geduldt (Appendix 3)
Proposed Amendments to Intelligence Services Bill [B58A-2002] (Appendix 4)
Latest Amendment to Definition of "subversion" in National Strategic Intelligence Amendment Bill (Appendix 5)
Cell C Submission (Appendix 6)

SUMMARY
The Transtel submission on the ComSec Bill called for the reworking of certain definitions, raised concern with the possible duplication of the functions of telecommunications service providers (TSP) and those of ComSec under Clause 7 of the Bill, and the exemption of ComSec from provisions of the Telecommunications Act. The discussion on this presentation dealt with the proposed reworking of definitions especially "electronic communications product", and the concern with the competition Transtel would receive from ComSec via Clause 7.

The Telkom submission on the ComSec Bill also raised concern with the overlapping of functions of ComSec and existing TSP in Clause 7, the exemptions of ComSec from the Telecommunications Act and Companies Act, the exemption from liability under Clause 24 and the acquisition of shares in "any other company" in Clause 18(10). In the discussion on the presentation the Committee assured Telkom that no overlapping is envisaged, because Telkom does not provide the security needs which ComSec has been mandated to provide. Telkom proposed that the acquisition of shares be limited to companies involved in provision of security, that Clause 6 creates a legal discrepancy and that the use of the term "in good faith" in Clause 24 should be deleted.

In his submission Mr Grant Gedudlt, a former SAS operative, raised concern with the restraint of trade imposed by Clause 28, sought clarity on the types of communication prohibited in Clause 29 and requested the powers of the Minister of Intelligence in Clause 31 to be fettered. In the discussion on this presentation is was suggested that the restraint of trade in Clause 28 is imposed in the interests of national security and the rights in Clause 31 are not absolute.

A minor amendment to Clauses 11 and 14 of the Intelligence Services Bill was effected, and a new Section 2A was inserted in the National Strategic Intelligence Amendment Bill was introduced to allow SAPS and the Department of Defence to be assisted by the NIA and it also now includes a definition of "polygraph test".

MINUTES
Electronic Communications Security (Pty) Ltd Bill
The Chair informed Members that Dr S Cwele (ANC) is tied up in Pretoria and would thus not be able to Chair this meeting. During this meeting the Committee will hear oral submissions on the Bill from Telkom, Transtel and Mr Grant Geduldt.

Transtel Submission
The presentation was conducted by Mr Denzil Bowman, Transtel/Eskom Parliamentary Office, and Ms Reddy, Transtel/Eskom Senior Legal Advisor (see submission). Transtel proposed inter alia that certain definitions in the Bill be reworked, raised concern with the extent of consultation catered for in the Preamble of the Bill, whether Clause 3 applies to the private sector as well, the concern that Clause 7 allows the Electronic Communications Security (Pty) Ltd (ComSec) to duplicate functions already performed by telecommunications licence-holders and expressed concern with the exemption of ComSec from the Telecommunications Act via Clause 18.

Discussion
"related services"

The Chair stated that Transtel merely calls for the inclusion of a definition of the term "related services", but does not motivate the reason for this proposal.

Ms S van der Merwe (ANC) asked whether Transtel is proposing that this term be deleted from the Bill, or is it requesting a definition to the inserted?

Mr Bowman replied that Transtel suggests that the term be deleted because it casts the net too widely, and it needs to provide clarity for third parties.

The Chair stated that it does not appear that Transtel understands the functions of ComSec and ComSec will not be in competition with anyone, as he understands matters.

Mr Bowman replied that Transtel merely requests that this matter be clarified.

The Chair stated that the proposal would be noted, even though it may not "do the trick".

"critical electronic communications"
The Chair asked for clarity regarding this proposal.

Ms van der Merwe stated that she was also of the opinion that the definition of this term is too widely phrased, and during the meetings held last week the presenters clarified the meaning of this term "considerably".

"electronic communications product"
The Chair stated that this refers to Clause 7(1)(b) and (c) of the Bill, and asked whether the Telecommunications Act provides a definition of the term "product".

Ms Reddy replied that she was not certain and would have to check up on this.

The Chair contended that this should have been done before addressing this Committee, and if it has been included in that Act it does not then make sense for Transtel to request that definition be included in this Bill and not in that Act.

Ms M Olckers (NNP) suggested that the problem here is that "products" change because of the rapid pace at which the technology in the industry evolves, and the current technology could very well become obsolete within a year.

The Chair stated that Ms Olckers is saying that Transtel is asking Parliament to set out a "shopping list of products" but the reality of the matter is that the industry could come up with new technology, and it is then uncertain how this technology would be accommodated in the Bill.

Ms Reddy replied that Transtel requests that the precise type of services that fall within the competence of ComSec be spelt out, and it also accepts the points made regarding the change in technology.

The Chair stated that the primary function of ComSec would be to provide security to all organs of state.

Mr D Gumede (ANC) suggested that it might help if Transtel were to explain the reason for this proposal. Is it afraid that ComSec will interfere with its functioning?

Ms Reddy responded that clarity is needed regarding the exact sphere of ComSec's activities, as the Bill currently provides that there will be areas in which ComSec will be active which overlap with the services provided by Public Switched Telecommunications Services (PSTS) licensees.

The Chair contended that Ms Reddy has stated that she has read the Memorandum to the Bill yet Transtel remains unclear on the precise role of ComSec.

Ms Reddy replied that the problem remains that the Bill seeks to exempt ComSec from certain provisions of the Telecommunications Act.

"electronic communication systems and services"
Mr Bowman stated that this term refers to Clause 7(2)(b) of the Bill.

Ms Olckers suggested that if this term were to be defined in Clause 7 this would amount to "telling everyone out there how it is done", and it is part of the secrecy that every detail of the operations is not laid bare.

Brig Gen P Schalkwyk (DP) agreed.

Mr Bowman replied that he acknowledges this but Transtel's concern here is that this allows ComSec to provide a broad range of services, and the Bill has to ensure that these functions do not overlap with those already performed by the PSTS licensees.

Preamble
The Chair stated that the role of ComSec is to enhance national security, has Transtel grasped this important point?

Ms Reddy answered in the affirmative.

The Chair replied that this understanding does not "come through" in Transtel's proposal here, because all organs of state cannot be consulted here as they include numerous bodies. It has to be remembered that this Bill is a result of a policy decision taken by government and a fair amount of government departments have been consulted in the drafting process, yet Transtel calls for organs of state to be consulted.

Mr M Scott (ANC) stated that the Bill merely aims to organise and enhance the security structure and its capacity, and it should not be seen as a threat to "trample" on Transtel's area of operations.

Quoshi Mokoena (ANC) asked Transtel to indicate who, in its opinion, could have been consulted, and the effect that such consultation would have had.

Mr Bowman replied that the Memorandum indicates that several government departments have been consulted, but not many state-owned enterprises have been consulted. Transtel would have preferred Telkom and itself to have been consulted.

The Chair stated that this would be noted.

Clause 7: Functions
The Chair stated that this proposal by Transtel suggests that "they are worried about being swallowed up by ComSec" but assured Transtel that it is "perfectly safe", because Transtel cannot provide the security functions that ComSec does.

Ms Takie Netshitenzhe, from the Department of Intelligence (the Department), stated that the clause is self-explanatory as it seeks to integrate entities that perform similar functions to ComSec, and if other services are provided, as is the case with Transtel and Telkom, they would not be integrated.

Clause 17: Analysis of electronic communications security needs, and business agreement
The Chair asked for clarity on this proposal.

Ms Reddy replied that Transtel suggests that the procedure to be followed be included in the Bill to enable it to know in advance the procedure to be followed, as this would also allow transparency.

Ms van der Merwe suggested that Clause 17(2) provides "in the prescribed manner" and the procedure would therefore be spelt out in the regulations. This seems to cover Transtel's concerns.

Ms Reddy responded that this depends on what the regulations contain, and it will satisfy Transtel's concerns if it ensures the degree of transparency sought after.

Telkom Submission
The presentation was conducted by Ms Raksha Singh, Telkom Regulatory and Government Relations Department, and Adv Francois Slabbert, Telkom Senior Legal Advisor (see document attached). Telkom raised concern with inter alia possible overlapping of functions of ComSec and PSTS licensees under Clause 7 of the Bill, the extent to which the Bill applies to the private sector if at all, clarity was sought on the reason for exempting ComSec from the provisions of the Telecommunications Act and the Companies Act, allowing ComSec to acquire shares in other companies and also proposed that ComSec should not be exempted from liability in Clause 24.

Discussion
Clause 7: Functions
The Chair stated that Telkom's concern is that the PSTS licensees have to abide by the provisions of the Telecommunications Act, yet the Bill exempts ComSec from that Act.

Mr R Pieterse (ANC) stated that he accepts the concern raised by Telkom but the fact of the matter is that ComSec is not in competition with anyone.

Ms van der Merwe asked Telkom to explain what functions listed in Clause 7 are reserved for PSTS licensees.

Ms Singh replied that the Telecommunications Act states that the holder of a PSTS licence would provide telecommunications functions, and Clause 7(2)(b) of the Bill grants these functions to ComSec, and this clearly overlaps with the functions of the PSTS licencees.

The Chair contended that the key word here is "secure" as Telkom does not secure telecommunications because it is not able to and nor is it required to do so, whereas ComSec is both able and mandated to do so. Therein lies the difference.

Adv Slabbert stated that Telkom's concern is not with the security aspect, but rather with the term itself because the definition provided in the Bill is framed so widely, and it could therefore lend itself to abuse. There is also scope for unintended encroachment on the functions already performed by the telecommunications service providers.

The Chair proposed that Telkom formulate definite solutions to the concerns they are raising, and should not only focus on indentifying problems in the Bill.

With regard to the concern with Clause 7(2)(a) in Point 5 of the Telkom submission, there is only one reason for this clause and nothing else: national security.

Ms Olckers asked whether the phrase "constitutes a sizeable encroachment" in Point 5 implies that Clause 7 will allow ComSec to encroach on the functions currently performed by Telkom. Yet ComSec is not an ordinary licensee.

Adv Slabbert responded that Telkom does not wish to prescribe to government how it should conduct its affairs, but stated that Telkom's concern here is that the clause could be open to abuse.

Mr Scott assured Telkom that there are sufficient oversight bodies and Intelligence Agencies in place to ensure that events that transpired before 1994 do not happen again. Furthermore, ComSec has to adhere to the Constitution and the law, and there is no intention by government to say one thing in the Bill and then allow ComSec to do another.

The Chair contended that the concern raised by Telkom in Point 6 of its submission suggests that it is "worried about the competition it will face from ComSec".

Adv Slabbert replied that here again there is potential for abuse.

Ms Singh added that the concern here is that ComSec would charge organs of state for the security services it renders, yet it would also be receiving funding from the fiscus.

The Chair stated that competition is not an issue when national security is at stake. It is not a question of the profits made by Telkom and Transtel, but rather has everything to do with the national security of the Republic.

Ms van der Merwe contended that the aim of the legislation is not to enable ComSec to design networks, as stated last week by the Director-General of the Department of Communications, but must instead protect the data connection between two points. If this is not made clear in the Bill, then it has to be clarified.

Ms Singh stated that if the primary purpose of ComSec is to provide security why then does the Bill allow it to acquire shares in "any company", even if that company has nothing to do with the security industry. This matter has to be clarified.

The Chair stated that the provision does not stipulate that ComSec has to acquire a majority shareholding.

Ms Singh responded that this might be the case, but the provision does not prevent the acquisition of a majority shareholding either. ComSec should only be allowed to acquire shares in a company that is itself involved in national security, so that this provision is not too widely framed.

The Chair stated that this concern is noted.

Mr Gumede contended that the speed at which the technology in the security industry is changing does not allow such a provision to be enacted in the Bill.

Ms Singh replied that Telkom itself is involved in an industry in which technology changes by the day and for this reason the Department of Communications ha adopted a technologically-neutral approach in its legislation. A similar provision can be inserted here to deal with shares.

The Chair stated that Points 7, 8, 12, 14 and 15 in the Telkom submission have already been dealt with in the Transtel presentation. With regard to Points 9 to 11 of the submission, it is suggested that these concerns be taken up with the Director-General of Communications.

Clause 6: Request for exemption from application of provision of Companies Act
The Chair sked whether Clause 6 would be subject to legal challenge in view of the concerns raised by Telkom in Point 13 of their submission?

Ms Takie Netshitenzhe, from the Department of Intelligence (the Department), answered in the negative because ComSec is a private company which is by its very nature subject to exemption from the Companies Act, because of the nature of the business. ComSec is not the first entity to be exempted here, the same has been done with SITA.

Adv Slabbert contended that the concern here is that should ComSec acquire a majority shareholding in another institution, to what extent would that company then also be exempt from the Companies Act, as ComSec itself is exempt.

Ms Netshitenzhe replied that this would not be the case.

Ms Singh contended that there is thus a problem in law because ComSec can acquire shares in another company which is already 50% bound by the Companies Act, and it would therefore be half bound and half not. This therefore creates a disparity.

Adv Slabbert added that the concern here is that if ComSec acquires a majority shareholding it would not be limited to its objectives, and Telkom believes that such acquisition should be restricted to companies involved in the security industry.

The Chair asked whether Telkom is limited in its acquisition of shares.

Adv Slabbert answered in the negative.

The Chair stated that despite this, Telkom nevertheless wants ComSec to be so restricted.

Ms Singh responded that ComSec is a statutory body and is required to act in accordance with the law, and it does therefore not make sense if it acquires shares in an entity not involved in national security.

The Chair stated that this can be allowed.

Ms Singh responded that Telkom submits that if the Committee wishes to allow ComSec to acquire shares in another company, the particular type of company has to be spelt out in the Bill.

Mr Gumede contended that the oversight structures on place do regulate this matter.

Mr Bloem (ANC) reminded Telkom that ComSec is not an ordinary private company, but is involved in protecting national security.

Ms Singh stated that Telkom does not wish to tell the government how it should govern, but it has to be clear that the objects and tools used to achieve its mandate must be in line with each other, and it has to be ensured that the person reading the Bill understands this.

The Chair stated that this issue would be flagged for later discussion.

Clause 18: Funding of Comsec
Ms van der Merwe referred to Points 16 and 17 of the Telkom submission and stated that Members were informed that the intention is to enable ComSec to become "stand alone viable" in three years, but because there might very well be a greater demand on research it might be necessary for the State to continue supporting it beyond the anticipated period. Yet it is not the intention to subsidise ComSec. The use of the word "reasonably" in Clause 18(3) accommodates this concern.

Clause 24: Limitation of liability
The Chair referred to Point 18 in the Telkom submission and stated that the Constituion trumps all other laws in the Republic, and the concern raised is therefore covered.

Ms Singh replied that the use of the phrase "in good faith" in Clause 24 does not accord with international precedent on this matter, and event the Supreme Court of Appeals and the Constitutional Court itself have been unable to accurately define what is done in "good faith". This clause would then come under constitutional challenge.

Ms Netshitenzhe stated that Clause 24 is a standard clause and is aimed at addressing the situation in which ComSec employs a product but it fails to perform properly no due to any fault by ComSec itself, and the clause ensures that ComSec would not be held liable here, even though it has done everything to ensure protection. Should ComSec be sued, it would then be the responsibility of the courts to decide whether it acted in good faith or not.

The Chair asked for the reason behind including this clause in the Bill if, as Ms Netshitenzhe has stated, the courts would in any event decide whether ComSec has acted in good faith or not.

Ms Netshitenzhe replied that it has been inserted for emphasis and to ensure that ComSec acts in good faith.

Submission by Mr Grant Geduldt
Mr Geduldt, a former SAS operative, raised concern with Clause 28 of the Bill and the restraint of trade it places on former SAS operatives, as it violates Section 22 of the Constitution. He contended that Clause 29 does not sufficiently clarify the types of communications prohibited, and Clause 31 grants the Minister of Intelligence (the Minister) too wide a discretionary power and consequently infringes Section 12 and 14 to 18 of the Constitution.

Discussion
Mr Scott referred to the concerns raised by Mr Geduldt regarding Clause 28 and stated that, by the very nature of being an intelligence officer, Mr Geduldt would have gathered information which others "do not have a right to know", and because of this other might have an interest in such information. It is for this reason that the three-year restraint of trade has been imposed and, compared to foreign jurisdictions, it is a modest time period. Furthermore, as an intelligence officer your rights are limited by the very nature of the profession, and the restraint of trade is part of the profession as it aims to protect both the officers themselves and everyone else.

Ms van der Merwe added that the three-year is a defined period and there is not therefore a blanket limitation on the rights of intelligence officers in this regard and, as stated by Mr Scott, other countries have imposed a heavier restraint. Furthermore, it has to be remembered that the Bill is not preventing former intelligence officers from holding a position in any other industry, and even if they should decide to remain in the security service they would have to apply for a security clearance. This would then be granted or refused depending on the nature of the profession entered into. It was then decided, having considered all these factors, that the restraint imposed is sufficient and does not curb the rights of former intelligence officers.

The Chair stated that the mere fact that the mere fact that the CIA has sought to recruit Mr Gedudlt, as he mentioned during his presentation, clearly illustrates the sensitive nature of the matter and the need for the restraint of trade. South Africa is not the only country to employ such a measure, in fact it is probably the last to do so. Mr Geduldt contends that the Constitution allows him to "do as he please[s]" but then asks Parliament to "step in" when the restraint is imposed, but this is "asking [Parliament] to be naive".

Mr Geduldt replied that the input from Members has given him the clarity he was looking for in deciding to address his concerns to this Committee, and he now understands the need for the restraint of trade. The current formulation of the Bill does not make this clear. He is not against the security clearance certificate, but was merely in search of clarification on the precise requirements needed by the clearance. He did not want the Minister to "just ignore [him]" and not allow him to seek further employment.

The Chair stated that this would never happen, and in any event the Administrative Justice Act requires the Minister to provide him with reasons for refusing clearance.

Ms van der Merwe added that the requirements and procedure would be spelt out in the regulations.

The Chair contended that the rights referred to by Mr Geduldt regarding Clause 31 of the Bill are not absolute, and many people make this mistake. Section 36 of the Constitution specifically states that no right guarenteed in the Bill of Rights is absolute.

Mr Geduldt responded that his primary concern was that he did not know the "exacts" of the Bill and thus decided to approach the Committee for clarity, which it has now provided. The South African government should make an effort to inform its operatives of the obligations contained in the Bill, so that the Bill is not viewed as a negative Bill but a positive one.

Intelligence Services Bill
Ms Netshitenzhe read through the latest proposed amendments to the Bill (see document attached).

Clause 11: Powers and duties of members
The Chair proposed that the phrase "the judge referred to in subsection (2)" be inserted in Subclause 3(c), instead of merely "the judge" as proposed by the amendments.

Ms Netshitenzhe and Members agreed.

Clause 14: Security screening and discharging of members
Ms Netshitenzhe informed Members that the current version of this clause in the Bill has been deleted and replaced with the new version contained in the proposed amendments and now vests the power to perform these functions with the Director-General of the Department (the DG), and not with the Minister as was previously the case. The revised Subclause 2 now allows the person to know what kind of information is being gathered on him/her, and it was decided to stipulate this expressly in the Bill rather than leaving it to the discretion of the Minister via the regulations. The new Subclause 3 deals with the polygraph test and Subclause 4 deals with the directives to be issues by the DG.

The Chair asked to whom the appeals would then be forwarded under Subclause 4, whether this would be handled internally by the members of the Intelligence Forces or whether the outcome would be made available for public consumption.

Ms Netshitenzhe replied that the intention is for it to be made public because it does affect the public service, and there is also a general clause in the Constitution which requires regulations and directives to be made accessible to the public.

Clause 29: Prohibited communications by former members
Ms van der Merwe questioned whether the proposed amendment to Subclause (a) should read "or a foreign intelligence service" or "or foreign intelligence services", because it is currently phrased in both the singular and plural.


The Chair stated that it should be phrased in the singular.


Ms Netshitenzhe agreed and suggested that the presentation by Mr Geduldt raised concern with Clause 29, and perhaps a Subclause (c) should be inserted here to include "purely personal communications".

The Chair disagreed.

Ms Olckers stated that this is a difficult issue because SAS members would have forged friendships with each other over the years, and to prohibit communication would be unreasonable.

Ms van der Merwe proposed that the phrase "likely to be detrimental" in Clause 29 accommodates this concern.

The Chair agreed and suggested that by this logic the social interaction referred to by Ms Olckers would then not be "likely to be detrimental".

Ms Olckers proposed that the provision be phrased in a clearer manner, so that the former SAS members are clear on what types of communications are prohibited by this Bill.

A member of the SLA delegation contended that it is not easy to stipulate exhaustively in the Bill what types of communications would be prohibited, because each depends on the particular circumstances of that case.

Clause 38: Regulations
Ms Netshitenzhe informed Members that the deletion of this clause is proposed by the amendments because the insertion of the new Clause 14(2) already covers these matters.

The Chair noted that Members agreed.

National Strategic Intelligence Amendment Bill
The Chair noted the changes to Clauses 1 and 2 following the Committee's proposals during the meeting held on 11/10 contained in the Proposed Amendments (Appendix 1). Also, the proposed Section 2A(2) has been amended to allow SAPS and DOD to ask the NIA for assistance, Subclause 4(b) now includes a definition of "polygraph", Subclause 7 now includes "members or employees" and Subclause 8 lists the requirements for appeal against refusal of a security clearance.

Ms Netshitenzhe informed Members that she had still not received feedback from SAPS and the Department of Defence (DOD) on the proposed latest definition of "subversion" in the Bill (see Appendix 5), which is different to the definition in the Proposed Amendments.

The Chair stated that he preferred the latest definition of the term "subversion", because the inclusion of the phrase "covert unlawful acts" in the Proposed Amendments was too problematic.

Intelligence Control Amendment Bill
Ms Netshitenzhe proposed that this Bill not be discussed today, because the SLA has stated that there are consequential amendments to be effected to the Bill.

The Chair agreed, and informed Members that the Committee will be meeting on Tuesday 15 October to finalise and vote on the National Strategic Intelligence Amendment Bill and the Intelligence Control Amendment Bill, and on Wednesday 16 October the Committee will be meeting to finalise and vote on the Electronic Communications Security (Pty) Ltd Bill and the Intelligence Services Bill.

There were no further questions or comments and the meeting was adjourned.

Appendix 1
AMENDMENTS PROPOSED TO NATIONAL STRATEGIC INTELLIGENCE AMENDMENT BILL [B51-2002]

CLAUSE I
1. On page 2, in line 11, to omit "[intelligence]" and to substitute 'intelligence".

2. On page 2, after line 20, to insert the following paragraph:

(c) by the insertion after the definition of "South African Police Service' of the following definition:

"'subversion' means any activity directed towards undermining by covert unlawful acts, or directed towards, or intended ultimately to lead to the destruction, or overthrow by violence of the Constitutionally established system of government in the Republic of South Africa;".

CLAUSE 2
1. On page 2, in line 24, to omit "on request".

NEW CLAUSE
1. That the following be a new Clause:

Insertion of section 2A in Act 39 of 1994

1. The following section is hereby inserted in the principal Act after section 2:

"Security screening investigations

2A. (1)
The relevant members of the National Intelligence Structures may conduct a security screening investigation to determine the security competence of a person if such a person-
(a) is employed by or is an applicant to an organ of state;
(b) is rendering a service or has given notice of intention to render a service to an organ of state, which service may-
(i) give him or her access to confidential information in the possession of the state; or
(ii) give him access to areas designated National key points in terms of the National Key
Points Act, 1980 (Act No.102 of1980).
(2) The Agency shall be responsible for security screening of persons contemplated in subsection (1) excluding persons employed by, applicants to or persons rendering a service to the South African Police Service or the Department of Defence.
(3) Notwithstanding the provisions of subsection (2), the Agency may request the assistance of the South African Police Service or the National Defence Force in the performance of the function contemplated in subsection (2).
(4) The security screening investigation contemplated in subsection (1) may entitle relevant members of the National Intelligence Structures to use a polygraph, to determine the reliability of information gathered during the investigation.
(5) The relevant members of the National Intelligence Structures may gather information relating to-
(a) financial status;
(b) criminal record;
(c) personal information or
(d) any other information which is relevant to determine the security competence of a person: Provided that the communications of such a person shall not be monitored or intercepted without complying with the provisions of the Interception and Monitoring Prohibition Act, 1992 (Act 127 of 1992).
(6) The head of the relevant National Intelligence structure may at4er evaluating the information gathered during the security screening investigation, issue, degrade or withdraw or refuse to grant a security clearance.
(7) The head of the relevant National intelligence Structures may establish a security screening Advisory Board to assist him or her in the determination of the security competency of a person.
(8) A person whose security clearance has been refused, withdrawn or degraded may appeal to the Minister.
(9) The Director-General of the Agency may issue functional directives on:
(a) usage and application of polygraph;
(b) criteria for determining security competence; and
(c) levels of security clearance.
(10) The directives contemplated in subsection (9) shall be issued with the approval of the Minister. \\ho shall act in consultation with the Minister of safety and security and the Minister of Defence and shall apply to all the relevant National Intelligence Structures.

CLAUSE 4
1. On page 3, after line 19, to insert the following paragraph:

(b) by the addition to subsection (1) of the following paragraph:

"(g) the Director of the Financial Intelligence Centre.".

CLAUSE 6
1. On page 4. in line 20, to omit "Nicoc or its' and to substitute "the National Intelligence Structures or their".

Appendix 2
Transtel and Eskom Enterprises submission on the Electronic Communications Security Bill ("COMSEC").


Introduction

Eskom Enterprises and Transtel welcome the opportunity to make comments on the above Bill. We would further welcome the opportunity to make an oral presentation to the Committee to address any questions that the Committee may have regarding our submission. Our joint submission is set out below.


1. Comments on Definitions

1.1 It is recorded that the company established in terms of the Bill will provide electronic communications security products and "related services" to government and organs of State.


1.2 There is no definition provided for the term "related services". This casts the net of services that can be provided too wide. We submit that a definition of "related services" should be provided to enable third parties to identify areas where there is potential for overlapping of services and competition.


1.3 The definition for "critical electronic communications" is too wide and vague.


1.4 A definition of "electronic communications product" is needed.


1.5 A definition of "electronic communication systems and services" should be included.


1.6 "Critical Electronic Communications" means communications that are of importance for the protection of the national security of the Republic or the economic and social well being of the citizens.

1.7 This intent doesn't appear to fit too well with the Application of the Bill. Why should the Bill apply to the economic activities of citizens that are not organs of state?

1.8 "Critical Electronic Communications Infrastructure" means infrastructure that is of importance to national security of the Republic or the economic and social well being of the citizens.

1.9 "The Citizens" is not defined. Are citizens intended to be both private and juristic or only juristic as one could infer from the Application of the Bill?

2. Comments on Sections of the Bill

2.1 Preamble

The preamble of the COMSEC Bill indicates that it is applicable to organs of state. We submit that the provision of services to organs of state should be discussed with the various organs before the Bill is passed.


2.2 Section 3

2.2.1 The principle objective of Comsec (Pty) Ltd is to provide secure electronic communications for the protection of critical government communications in the interest of national security.

2.2.2 The objective begs the question as to whether the Bill applies to the private sector given that the aim of the Bill is to protect critical government communications in the interest of national security.

2.3 Section 7

2.3.1 The provisions of this section enable Comsec to install, maintain and provide electronic communications services and systems. The ambit of Comsec's powers extend into the domain of the Public Switched Telecommunications Service licence-holders. This is currently at variance with the Telecommunications Act.


2.3.2 It is not clear whether or not Comsec will provide its own infrastructure or whether it will be required to utilise existing infrastructure. It is our view that by providing its own infrastructure, Comsec will duplicate services and the end result will be an imprudent expenditure of taxpayers money.


2.3.3 What is intended by the word "integrate"? Does it mean integration on a general basis between Comsec and the third entity or does it mean integration in a partial fashion?

2.4 Section 9

2.5 Ad para (9(2) We believe that it is best that reference to the quorum of the Board of Directors be dealt with in Comsec's sharholders' agreement.

2.6 Ad para (9(3) Please see our comment to paragraph 9(2) above.

2.7 Section 10

Section 10(3) deals with disclosure requirements of the board of directors. This provision conflicts with the provisions of the Company's Act and good corporate governance.


2.8 Section 17

Procedure for approval and verification of electronic communication products must be included in the Bill.


2.9 Section 18

2.10 The implication of Comsec's exemption from the provisions of the Telecommunication's Act raises serious concerns. The principal objective of the Bill is to provide secure electronic communication for the protection of critical government communications, the Bill does not, however, stipulate how this will be achieved. There is therefore no clear indication as to why Comsec should be excluded from the Telecommunications Act in its entirety.


2.11 Furthermore if it is envisaged that Comsec will interconnect with the PSTS operator/s, we submit that Comsec must be subject to the Telecommuncations Act.


2.12 Instead of the rates that will determine the cost of the service being periodically approved by the Minister of Finance, they should be approved at least every six months or annually by the Minister of Finance.


2.13 Section 20

Clarity is required on the criteria for exemption from the provisions of the Bill.


2.14 Section 21

The Bill is unclear on who will be liable for the costs of protecting the infrastructure.

2.15 Section 22

Ministers do not have the legislative competence to make regulations. Ministers' functions are to set broad policy frameworks and agendas. An administrative body is the appropriate entity to make regulations. This provision needs to be changed immediately or else the Bill will be unconstitutional.

Appendix 3
Dear Sir/Madam

I was a member of the South African Secret Service from August 1997 till June 2001 As a former member of an intelligence structure l wish to raise certain objections with
regard to Section 28, Section 29 and Section 31 of the Intelligence Services Bill.

SECTION 28 : EMPLOYMENT IN PRIVATE SECURITY INDUSTRY
(l)"A former member may not, for a period of three years after leaving the Intelligence
Services or the Academy, render a security service unless be or she has obtained a
clearance certificate from the Director-General concerned or the Chief Executive Officer,
as the case may be.
(2) The Minister may prescribe the manner in which any former member may apply for a clearance certification referred to in subsection (I)

I am not aware of the Ministry of intelligence reasons for prohibiting former members' from rendering a security service after leaving the Intelligence Services or Academy. The criteria which the Ministry of Intelligence should use to determine legislation with regard to former members must be geared towards ensuring the security of the Republic. I do not see how a former intelligence member, rendering a security service, constitutes a threat to the security of the Republic. This restriction violates the fundamental right to earn a living as set out in Section 22 of the Bill of Rights which states: "Every citizen has the right to choose their trade, occupation or profession freely.

With regard to the issuing of a clearance certificate, the manner in which a former member may apply for a clearance certificate, what is the criteria for obtaining a clearance certificate and the reason for the clearance certificate are not clearly set out in the Bill and gives the Minister roe much discretionary power

I also wish to bring to the Ministry of Intelligence attention the principles governing a Restraintive Trade. Where a person or persons are restriced from engaging in a trade in which he or she is skilled, that person is entitled to compensation. The Bill makes no provision for compensation.

SECTION 29:PROHIBITED COMMUNICATION BY FORMER MEMBERS
"No former member may communicate in the Republic or elsewhere in a manner that is likely to be detrimental to the security of the Republic with any person-
(a) who is or was member, representative or associate of the Intelligence Services or the Academy;
(b) who co-operates or has co-operated with the lntelligence Services or the Academy in respect of matters concerning the security of the Republic.

This section does not clarify what constitutes a communication in a manner that is likely to be detrimental to the security of the Republic. It is too broad and gives the Minister too much discretionary power.

SECTION 31: CONDUCT OF FORMER MEMBERS
"The Minister may prescribe the manner in which former members must conduct
themselves in order to protect the security of the Republic and the interests of the intelligence Services and Academy"

This Section gives the Minister too much power and infringes on the following Constitutional Rights contained in the Bill of Rights:

Section 12 (2) b: Freedom and security of the person
"Everybody has the right to bodily and psychological integrity, which includes the right to security in and control over the body.

Section 14; Everyone has the right to privacy

Section 15:Freedom of religion, belief and opinion

Section 16: Freedom of expression

Section 17: Right to assemble, demonstrate, picket and present petitions

Section 18: Freedom of association

Yours sincerely
Mr G T Geduldt


Appendix 4
PROPOSED AMENDMENTS TO INTELLIGENCE SERVICES BILL
[B 58-2002]

CLAUSE I
1. On page 2, in line 13, after the definition of "Chief Executive Officer", to insert the following definition:

"counter-intelligence" means counter-intelligence as defined in section 1 of the National Strategic Intelligence Act, 1994 (Act No.39 of 1994);

2. On page 2, from line 26, to omit the definition of "Minister" and to substitute the following definition:

"Minister" means the President or the member of Cabinet designated by the President to assume the responsibility for intelligence services as contemplated in section 209 (2) of the Constitution'

3. On page 2, in line 34 to insert after "(APLA)" the following words "the Pan Africanist Security Service".

CLAUSE 5
1. On page 5, after line 37, to insert the following new clause as sub clause (6) and the existing one becomes sub clause (7):

(6) The Chief Executive Officer must, at the end of each financial year, submit the report of the Auditor-General and the annual report of the Academy compiled in accordance with the provisions of the Public Finance Management Act, 1999 (Act No 1 of 1999) to the Minister and the Joint Standing Committee on Intelligence for consideration.

2. On page 5, after line, 39, to insert the following new sub clause:

(8) The accreditation and recognition of the Academy's qualifications must be done in accordance with the provisions of the South African Qualifications Authority Act, 1995 (Act No 58 of 1995).

CLAUSE 9
On page 6, in line 16, to omit "must" and to insert "may".

CLAUSE 10
On page 6, from line 48, to insert the following new sub clause (3); the present sub clause (3) becoming (4):

(3) The Director-General may, in a prescribed manner, subject to the approval of the Minister and the provisions of this Act, issue functional directives applicable to-
(a) physical security;
(b) competent security;
(c) communication security;
(d) protection of classified information;
(e) conditions of service and human resources of the Intelligence Services or the
Academy as the case may be: Provided that the functional directives on
conditions of service and human resources must-
(i) be done in consultation with the Intelligence Services Council: and
(ii) be consistent with the regulations issued by the Minister;
(f) any other matter that is necessary for the intelligence and counter -intelligence functions of the services.

On page 6, from line 53, to omit paragraph (b) and to substitute the following paragraph:

(b) neither the Intelligence Services, the Academy, nor any of their members, may, in the performance of their functions-
(i) prejudice a political party interest that is legitimate in terms of the Constitution; or
(ii) further, in a partisan manner, any interest of a political party; and

CLAUSE 11
1. On page 7, in line 36, to omit "he or she" and to insert "the judge".

2. On page 7, in line 42, to omit "must" and to insert "may".

CLAUSE 14
Clause rejected.

NEW CLAUSE
That the following be a new clause:

Security screening and discharge of members

14.
(1) No person may be appointed as a member unless-
(a) information with respect to that person has been gathered in the prescribed manner in a security screening investigation by the Intelligence Services; and
(b) the Director-General, after evaluating the gathered information, is of the reasonable opinion that such a person may be appointed as a member without the possibility of such a person being a security risk or acting in any way prejudicial to the security interests of the Republic.

(2) In order to gather the information contemplated in subsection (1) (a), the Intelligence Services may, in a prescribed manner, have access to-
(a) criminal records;
(b) financial records;
(c) personal information; and
(d) any other information which is relevant to determine the security clearance of the person:
Provided that where the gathering of information contemplated in paragraphs (p) and (d) requires the interception and monitoring of the communication of such a person, the Intelligence Services must perform this function in accordance with the provisions of the Interception and Monitoring Prohibition Act, 1992 (Act No.127 of 1992).

(3) The Director-General may, in a prescribed manner, engage the services of a polygraphist to determine the reliability of the information gathered.

(4) The Director-General may issue directives on-
(a) the use and application of the polygraph test;
(b) the level of security clearance; and
(c) criteria for evaluating the security competence.

(5) The Director-General may, after evaluating the information gathered as contemplated in subsection (1) (b), issue, degrade, withdraw or refuse to grant a security clearance certificate.

(6) If the certificate referred to in subsection (5) is withdrawn, the member is deemed unfit for further membership of the Intelligence Services or the Academy and the Minister may-
(a) discharge such person or member from the Intelligence Services or the Academy, as the case may be; or
(b) with the approval of the Minister responsible for the department in question, transfer such person or member to that department subject to any law governing the transfer.

(7) A person whose security clearance has been refused, withdrawn or degraded may, in a prescribed manner, appeal to the Minister.

(8) On intervals prescribed by the Minister, a member may be subjected to a security screening investigation to determine his or her security competence to remain in the Intelligence Services.

(9) All the provisions regarding security screening investigations, applicable to a person contemplated in subsection (1) applies to security screening of members.

CLAUSE 15
1. On page 8, in line 43, to omit "calendar" and to insert "consecutive".

CLAUSE 20
1. On page 10, from line 24 to delete the words "excluding any power conferred upon or duty assigned to him or her by this Act,".

CLAUSE 22
1. On page 10, in line 46, to delete sub clause (1) and to substitute the following sub clause:

(1) There is hereby established an Intelligence Services Council on Conditions of Service which consists of not more than three persons or members appointed on contract by the Minister, one of whom must be Chairperson.

3. On page 11, in line 16, to omit "must" and to insert "may".

4. On page 11, from line 18, to delete subsection (6).

5. On page 11, in line 22, to omit "must" and to insert "may".

CLAUSE 23
On page 11, in lines 28 and 30, to omit "shall" and to insert "must".

CLAUSE 26
On page 13, in line 7, to omit "10" and to insert "15".

CLAUSE 27
On page 13, in line 24, to delete sub clause (3) and to substitute the following sub clause:

(3) For the purposes of subsection (1), the Director-General concerned or the Chief executive officer may consult any member or person to advise him or her on the consideration of applications by former members for permission to disclose classified information or material.

CLAUSE 29
On page 13, in line 41, after "Academy" to add "or a foreign intelligence services",

CLAUSE 38
On page 16, from line 21, to delete subsections (3) and (4).


Appendix 5
AMENDMENTS PROPOSED TO NATIONAL STRATEGIC INTELLIGENCE AMENDMENT BILL [B51-2002]

CLAUSE I
2. On page 2, after line 20, to insert the following paragraph:

(c) by the insertion after the definition of "South African Police Service' of the following definition:

" 'subversion' means any activity intended to destroy or undermine the Constitutionally established system of government in the Republic of South Africa;".

Appendix 6
Submission made by Cell C (Ptv) Ltd on the Electronic Communications Security (Pty) Ltd Bill in response to Notice 1841 of 2002 in Government Gazette 23889

In response to the request for comment on the Bill, Cell C wishes to take advantage of the opportunity to present to the Joint Standing Committee on Intelligence its comments thereon. In doing so, Cell C will limit the scope of its submission to the following two points.

1. Scope of Comsec's Functions

The preamble to the Bill states that a company will be established that will provide electronic communications security products and services to organs of state. Section 3 of the Bill, furthermore states that the principal objective of the company ("Comsec") is to ensure that critical electronic communications of organs of the state are protected. Section 7 sets out the functions of Comsec which include, inter alia, the procurement, installation and maintenance of secure electronic communications systems and the provision of secure electronic communications services.

Cell wishes to point out that it is imperative to distinguish between the provision of security services applicable to communications and the provision of the communication services It must be made clear that the function of Comsec is to provide the required level of security to the communications of organs of state. The provision of the communication services should however remain the responsibility of the telecommunication service operators licensed in terms of the Telecommunications Act, 103 of 1996.

Cell C maintains that the Bill as currently drafted does not make this distinction clear and is cause for confusion in this regard.

2. Exemption from Telecommunications Act, 103 of 1996

Section 7(6) of the Bill exempts Comsec from the licensing requirements contemplated in the Telecommunications Act. Section 26 and Schedule 1 of the Bill does however not amend the Telecommunications Ad in any manner.

Cell C is of the view that it is not possible to amend the Telecommunications Act by way of a stipulation in another piece of legislation. The Telecommunications Act would have to be amended in order to give effect to section 7(6) of the Bill.

Section 4 of the Telecommunications Act binds the State to compliance with provisions of the Telecommunications Act. Comsec is a company established to secure and protect critical electronic communications held by organs of state. The purpose for which it has been established should not, and at this point in time does not, constitute a derogation from the Telecommunications Act. It must also be borne in mind that the functions of Comsec are not clearly defined and it is not clear at this stage what category of telecommunications licence, if any, Comsec would require or which licensing requirements it is to be exempt from.

In the light of the above, Cell C therefore wishes to caution against any amendments to the Telecommunications Act. Cell C does not foresee any unnecessary constraints being placed on Comsec by requiring compliance with the Telecommunications Act by Comsec. Neither is it able to foresee any special benefits or public interest considerations requiring licensing exemption from the Telecommunications Act.

Cell C would welcome any opportunity to further engage with Parliament on this and other telecommunications related matters-

Yours sincerely

Karabo Motlana
Head: Regulatory Affairs

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