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PRIVATE MEMBERS LEGISLATIVE PROPOSAL AND SPECIAL PETITIONS PORTFOLIO COMMITTEE
5 March 2003
SEMPLE'S PREVENTION OF ILLEGAL EVICTION AND UNLAWFUL OCCUPATION OF LAND AMENDMENT BILL; KALYAN'S PATENT AMENDMENT BILL
Chairperson: Mr A Ainslie (ANC) (Acting)
Documents handed out:
Semple's memorandum to amend the Prevention of Illegal Eviction & Unlawful Occupation of Land Amendment Bill (Appendix 1)
Kalyan's memorandum to amend the Patent Amendment Bill (Appendix 2)
Business Day article 12 Sept 2002: Housing ministry seeks advice on court's illegal occupation ruling (Appendix 3)
The Committee was briefed on the legislative proposals of Ms J Semple (DP) and Ms S Kalyan (DP).
Ms Semple requested the amendment of the definition of "unlawful occupier" in the Prevention of Illegal Eviction from and Unlawful Occupation Land Act. This amendment would provide protection for the rights of landlords and bond grantors. Based on input from the Deputy Minister of Agriculture and Land Affairs who noted that this is a delicate matter, the Committee decided that all relevant departments should be invited to make submissions on this matter.
Ms Kalyan asked the Committee to reconsider her proposal, which requested the amendment of the Patents Act to deal with the issue of compulsory licences for public non-commercial use and the declaration of a national emergency in circumstances where the health, welfare or security of the nation warranted urgent remedial action and a patented article may be required to deal with the national emergency. The HIV/AIDS pandemic was cited as a reason for the amendments.
The Committee Chairperson was unable to attend the meeting and in accordance with Rule 130 of the National Assembly Rules, the Committee unanimously, nominated Mr A Ainslie (ANC) as acting chairperson.
Prevention of Illegal Eviction and Unlawful Occupation of Land Amendment Bill by Ms Semple
The Chair acknowledged the presence of the Deputy Minister of Agriculture and Land Affairs, Prof D Du Toit, at the meeting. He noted that the Committee had received a legislative proposal from Ms Semple requesting the amendment of the definition of "unlawful occupier" in the Prevention of Illegal Eviction from an Unlawful Occupation Land Act.
In support of her legislative proposal, Ms Semple noted that the proposal to amend the definition of "unlawful occupier" is based on the fact that it could not have been the legislature's intentions in passing this Act to regulate the relations between landlords and their tenants. So the Act was intended to apply only to squatters and not to bond defaulters or tenants who fail to pay their rent. .This amendment would provide protection for the rights of landlords and bond grantors.
Mr P Gerber (ANC) applauded Ms Semple for taking this initiative. However he noted that since this amendment deals with something which might not have been perceived by the legislature, it would therefore be important to invite submissions from other departments before a decision could be taken.
Mr S Mshudulu (ANC) noted that it would be important for Ms Semple to submit other documents and information which are relevant to the matter as that would assist the Committee in making an informed decision.
Prof D Du Toit (Deputy Minister of Agriculture and Land Affairs) also commended Ms Semple for the initiative she has taken to ensure that this matter is addressed by Parliament. However he noted that this is a delicate matter, which would need to be thoroughly considered before any decision could be taken since there are various Acts that might be affected by such an amendment. Thus he concurred with the view that other departments should be invited to make their submission on the matter, especially the Department of Housing.
The Chair noted that based on the comments of the members there seems to be a consensus that other departments should also be invited to make submissions before any decision is taken on this matter.
Ms Semple thanked the Committee for giving her a hearing and noted that her concern is that the definition as it stands would tremendously affect the market value of houses and thus seriously disadvantage their owners.
Patents Amendment Bill by Ms S Kalyan
The Chair noted that Ms Kalyan's proposal to amend the Patent Act received on 9 November 2001 had been removed from the Committee's agenda at her request. However she had now requested the Committee to reconsider the matter.
Ms S Kalyan (DP) explained that she had asked the Committee to hold the matter in abeyance since there had been another Bill of the same name before Parliament, which had a bearing on this proposal. However although said Bill had since been passed by Parliament, it did not necessarily address the issue of patents in relation to generic drugs. Therefore, based on the Minister of Health's cry that anti-retroviral drugs are very expensive and from the call of the Medical Research Council, a generic equivalent should be produced in South Africa.
The Chair noted that bearing in mind that the implementation of this proposal would be costly and time consuming, Ms Kalyan should comment on the idea that even if the administrative procedures are to be used this piece of legislation would not be able to escape the legal clutches.
Ms Kalyan responded that there are countries that use the procedure she is proposing and anyway in case of a judicial intervention, a state of emergency may be called to bypass the courts. This had been done successfully in countries like Brazil and Thailand.
Mr Mshudulu noted that it should be borne in mind that there are issues and principles that need to be followed before a state of emergency can be declared. Thus a state president cannot just declare a state of emergency out of the blue as that could have severe implications
Ms M Coetzee-Kasper (ANC) noted that Ms Kalyan is a member of the Health Portfolio Committee and this proposal involves a health issue. It would be appropriate to refer this matter to that committee for its consideration.
Mr M Da Camara (DP) noted that if the Committee refers the matter to the Health Committee and the Ministry, it should insert a proviso requesting them to respond before a certain date since referral alone would not be proper.
The Chair noted that the members agree that Ms Kalyan's proposal should be referred to the Portfolio Committee on Health and its Department for consideration. The Committee would request that they both respond within three weeks of receiving this referral.
The meeting was adjourned.
PREVENTION OF ILLEGAL EVICTION FROM AND UNLAWFUL OCCUPATION OF LAND AMENDMENT BILL
Private Members' Bill
Submitted in terms of Section 73 (2)
Read with Section 76 (1) of the Constitution
Notice is hereby given of the introduction of a Private Members' Bill in terms of Section 73 (2) read with Section 76 (1) of the Constitution. In terms of rule 234 (read with rule 230 (1), a member must submit to the Speaker a memorandum which:
- sets out particulars of the proposed legislation
- explains the objects of the proposed legislation; and
- states whether the proposed legislation will have financial implications for the State and, if so, whether those implications may be a determining factor when the proposed legislation is considered.
- PARTICULARS OF PROPOSED LEGISLATION
The Honourable Speaker is requested to deal with this Bill in terms of Section 235 of the National Assembly Rules.
Prevention of Illegal Eviction From and Unlawful Occupation of Land Amendment Bill
To amend the definition of "unlawful occupier" in the Prevention of Illegal Eviction From and Unlawful Occupation of Land Act, No 19 of 1998 so as to leave no doubt that the Act applies to squatters only and not to bond defaulters or tenants who fail to pay their rent.
- Amendment of Definition (xi) (Line 14 of the Act, No 19 of 1998)
1. The definition of "unlawful occupier" is amended by the insertion after the words "person who", where they appear in line 14 of the Act, of the words "initially occupied and still"
Thus the full, amended definition reads:
(xi) "unlawful occupier" means a person who initially occupied and still occupies land without the express or tacit consent of the owner or person in charge, or without any other right in law to occupy such land, excluding a person who is an occupier in terms of the Extension of Security of Tenure Act, 1997, and excluding a person whose informal right to land, but for the provisions of this Act, would be protected by the provisions of the Interim Protection of informal Land Rights Act, 1996 (Act No. 31 of 1996).
- THE OBJECTS OF THE PROPOSED LEGISLATION
The intended Bill has as object:
- To change the definition of "unlawful occupier" so that it is not open to different interpretations.
- To change the definition of "unlawful occupier" so as to leave no doubt that the intention of the Act will be to remove originally lawful occupiers from the definition of "unlawful occupiers" therefore providing protection for the rights of Landlords and Bond grantors.
- To create a more financially stable environment for landowners in South Africa.
- To ensure that all tenants are not prejudiced by being required to pay very large deposits when taking occupation of rented premises.
- To ensure that applicants for bond finance are not subjected to even more stringent financial hurdles before having access to bond assistance.
- FINANCIAL IMPLICATIONS
The Legislation will have no financial implications.
Name of Member: Janet Semple
Patent Amendment Bill (Submitted by Mrs Kalyan on 9 November 2001)
It is hereby notified that the introduction of a Bill in terms of Section 73(4) read with section 76(2) of the Constitution will be made. This memorandum contains:
Â· Particulars of the proposed legislation;
Â· The objectives of the proposed legislation; and
Â· An indication of the financial implications of the proposed legislation and an indication of whether such implications may be a determining factor in the consideration of the proposed legislation.
The required legislation is set out herein.
PARTICULARS OF THE PROPOSED LEGISLATION
The following amendments to the PATENTS ACT 1978 (ACT 57 OF 1978) [hereinafter referred to as "the Act"] are proposed:-
1. Insert the following definitions in section 2 (the definitions section) of the Act:-
"President" means The Head of State as referred to in section 83 of the Constitution (Act 108 of 1996).
"petitioning Minister" for the purposes of section 56A and 56B means a Minister referred to in section 91 of the Constitution who applies for a compulsory license.
"national emergency" shall be declared by the President in terms of section 56B(...)
"reasonable period of time" shall be deemed to be a period of three calendar months unless circumstances justify acting within a shorter period.
"Cabinet" is as defined by section 91 of the Constitution.
"Public non-commercial use" shall include all projects and provision of goods and services which are completely funded by government and/or donors for the benefit of the general public at large and no fee shall be payable by members of the public to benefit from such goods and services.
2. Insert a new section after section 56 to be numbered section 56A, to deal with the issue of compulsory licenses for public non-commercial use.
Compulsory license for public non-commercial use
56A (1) A petitioning Minister may apply to the Commissioner for a compulsory license under a specified patent in circumstances where,
(a) The license is required for public non-commercial use; and
(b) The license is required for the health, welfare or security of the nation and the threat faced by the nation is of such a nature that given the resources of the State it cannot reasonably be dealt with by any other measures in the ordinary course of events; and
(c) Agreement could not be reached, within a reasonable period of time, between the petitioning Minister and the patentee regarding the terms under which the license was to be granted.
(2) The Board of Trade shall make a determination of the remuneration to be paid to the patentee and the manner in which such remuneration is to be paid. In making such determination the aforesaid Board shall consider:
(a) The economic value of the license.
(b) The cost of developing the patented article.
(c) How and by whom the cost of developing the patented article was paid.
(d) The economic and financial position of the State.
(e) The need for which the license is required.
(f) Representation from the patentee.
(3) The aforesaid determination shall be lodged together with the application to the Commissioner for a compulsory license and the commissioner shall be bound by such determination unless the patentee can show that such determination is not equitable in the circumstances.
(4) The petitioning Minister shall, in the application to the Commissioner, set out the purpose for which such a license is required and the time period for which the license is required.
(5) The Commissioner may issue the license under such terms and conditions, relating to the remuneration and duration of the license, as are just and equitable in the circumstances.
(6) Any license issued under this section shall be non-exclusive, and may not be assigned, and goods produced under such a license shall only be used and distributed within the Republic for non-commercial public use.
(7) The patentee may apply to the Commissioner, on good cause shown, to revoke a license granted under this section.
(8) The patentee may apply to the Commissioner, on good cause shown, to vary the conditions under which such a license is granted in terms of this section. This shall specifically include the right to apply for a variation of the determination made in terms of subsection 2 above.
(10) Nothing contained herein shall derogate from the patentee's right to take any ruling or decision of the Commissioner on appeal or review. However, subject to the patentee's right to claim damages, lodgement of such an appeal or review shall not suspend the operation of such license pending the outcome of the appeal or review proceedings.
3. Insert a new section after section 56A to be numbered section 56B, to deal with the issue of compulsory licenses in cases of national emergency.
Compulsory license in cases of national emergency
56B (1) The President may, after consultation with the Cabinet, declare a national emergency in circumstances where the health, welfare or security of the nation warrant urgent remedial action.
(2) The President shall issue a notice setting out the nature and extent of the national emergency. Such notice shall be published in the Government Gazette and, if circumstances allow, shall be delivered to a patentee whose patented article may be required to deal with the national emergency.
(3) The petitioning Minister who is responsible for dealing with the national emergency concerned must lodge with the Registrar of Patents a copy of the aforesaid notice.
(4) The Minister of Trade and Industry acting in conjunction with the Minister of Finance, shall make a determination of the remuneration to be paid or compensation to be made to the patentee and the manner in which such remuneration is to be paid or compensation made. In making such determination the aforesaid Minister shall consider:
(a) The economic value of the license
(b) The cost of developing the patented article,
(c) How and by whom the cost of developing the patented article was paid,
(d) The economic and financial position of the State,
(e) The nature and extent of the national emergency,
(f) The need for which license is required, and
(g) Representation from the patentee, if time and the prevailing circumstances allow.
(5) The petitioning Minister must lodge an application with the Registrar together with the determination made by the Ministers of Trade and Industry and Finance.
(6) Subject to the patentee's right to subsequently claim damages should a license not be confirmed, or should a license be revoked, once such an application is lodged with the registrar it shall be deemed that a license has been issued on the terms requested in the application.
(7) The application shall then in due course be referred to the Commissioner for determination, who must:
(a) If satisfied that the President has issued the certificate of national emergency lawfully, and
(b) If satisfied that the determination of the Minister's of Trade and Industry and Finance is just and equitable in the circumstances, confirm the license deemed to have been issued.
(8) In the event that the Commissioner is not satisfied with the determination by said Ministers, the Commissioner may confirm the license under such terms and conditions as are just and equitable.
(9) Any license issued or ruling made by the Commissioner may be appealed or reviewed in accordance with the laws of the Republic.
(10) Should the petitioning minister or the President be found to have abused their discretion by a competent court of law they shall be liable for damages, including punitive damages.
(11) Subject to the patentee's right to claim damages, any appeal or review that is lodged shall not suspend the operation of such license until the relevant court has finally determined the matter.
(12) The patentee may apply to the Commissioner, on good cause shown, to vary the conditions under which a license is granted in terms of this section.
(13) Any license issued in terms of this section shall be non-exclusive and non-assignable.
(14) Goods produced under such a license shall be predominantly for consumption within the Republic.
(15) The license shall lapse when the President withdraws the certificate of national emergency or when the patentee proves in court that the circumstances in which such certificate was issued have ceased to exist.
B. THE OBJECTS OF THE PROPOSED AMENDMENTS
Although these amendments are not aimed exclusively at any field in particular, the HIV/AIDS pandemic has clearly illustrated the need for amendments of this nature. The intention is to provide a mechanism to secure technology or patented articles where either the State cannot afford such technology or patented articles for consumption by the State or where there are circumstances which amount to a national emergency. The intention is to tailor the terms and conditions under which such licenses are issued to the circumstances in which the licenses are required.
C. FINANCIAL IMPLICATIONS
The proposals are amendments to existing legislation. No new agencies are required to implement these amendments. The amendments should not place any undue strain on the existing agencies that have to implement them. Although there may be financial implications, they are not so significant as to affect the desirability of such amendments. The need for this type of legislation outweighs the consideration of possible financial implications, which are likely to be secondary in nature.
NAME OF MEMBER: Sandy Kalyan
Business Day 12 September 2002
Housing ministry seeks advice on court's illegal occupation ruling
Ministry and industry fear verdict could negatively affect margins and investment
THE housing ministry is seeking legal advice after a recent Supreme Court of Appeal ruling that legislation protecting illegal occupiers from summary eviction not only applied to squatters, but also to former tenants and bond defaulters.
The ruling says the Prevention of Illegal Eviction from Unlawful Occupation of Land Act provides that no person may evict an unlawful occupier, except on the authority of an order of a court.
Anyone who contravenes this rule is guilty of an offence and liable on conviction to a fine, or to imprisonment not exceeding two years.
The judgment had been interpreted by some commentators as having the potential to create uncertainty in the housing market, the ministry said yesterday.
"The minister (Sankie Mthembi-Mahanyele) has therefore called for a recommendation from government law advisors on whether Constitutional Court action is necessary to protect the integrity of the housing market."
Herschel Jawitz, MD of Eskel Jawitz Real Estate, has meanwhile suggested that a special property court or arbitration process may be needed to keep the residential market stable in the wake of the appeal court's ruling.
"The scary thing is that tenants know how slow the courts are and use this to their advantage."
In theory, one can obtain a court order to evict a tenant. However, the sluggish legal process and overburdened courts mean it may take up to four months to secure an eviction order, Jawitz said. A way around this would be to introduce a specially designated property court or to make provision for an arbitration function, he said.
"In both cases, this would undoubtedly be more efficient and cost effective for all concerned. Clearly, there is a need to find a balance between protecting the rights of individuals against unscrupulous tenants and ensuring that common sense and good business principles prevail," he said.
He said the ruling could lead to landlords and banks demanding higher rentals and larger deposits to compensate for the additional risk.
People who buy to rent their properties play a critical role in the housing market in terms of supplying rental accommodation.
"Rulings like this act as a disincentive for property investors, and over time it could result in a contraction in the rental market, which in turn will result in higher rentals and even higher deposits. Very few tenants, if any, can afford to pay more than a one-month deposit," said Jawitz.
Banks are already under pressure to relax their lending criteria, especially at the lower end of the property market, without the burden of this ruling.
Johan Alheit of MacRobert Attorneys said the appeal court's ruling affects landlords and buyers of immovable property at sales in execution.
He said it might be possible for a skilful unlawful occupier to manipulate the legal process to extend occupation because of the lengthy process required for a landlord to evict a defaulter.
However, Alheit said the ruling did make provision for urgent proceedings where a real danger of substantial injury or damage may result if the unlawful occupier was not immediately evicted, or where the likely hardship for the owner exceeded the likely hardship of the occupier.
"It may be advisable for landlords to obtain a substantial deposit from a tenant. Landowners in general should be aware of the fact that any informal eviction may result in prosecution," he said.
SA Property Owners' Association (Sapoa) CE Brian Kirchmann said banks would be hesitant to grant substantial bonds on properties.
The judgment adds to many other taxes on property which are "putting severe strain on an industry that is already endeavouring to exist on very small margins" and will discourage foreign investment.
Sapoa intends to take the matter up with Mthembi-Mahanyele.
The New National Party also called for the judgment to be revised, noting that it was important that the property rights of investors and financial institutions were protected.
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