Insolvency Amendment Bill; International Criminal Court Bill: deliberations

Meeting report

JUSTICE AND CONSTITUTIONAL DEVELOPMENT PORTFOLIO COMMITTEE
31 May 2002
INSOLVENCY AMENDMENT BILL; INTERNATIONAL CRIMINAL COURT BILL: DELIBERATIONS

Chairperson: Adv De Lange (ANC)

Relevant documents:
NEDLAC report on the Labour Law Amendment Bills
Comment on the IAA Bill by the Law Society of the Cape of Good Hope
Cosatu additional comments on IAA Bill
The following 5 appendices are available in one document here:
INSOLV 11: Amendments proposed by Mr Cronje (Appendix 1)
INSOLV 10: Considerations on the IAA Bill - Matters referred to Mr Cronje (Appendix 2)
INSOLV 8: Follow-up info & proposals: briefing on Insolvency Amendment Bill (Appendix 3)
INSOLV 14: Labour and Employment Law in Germany, Netherlands, Finland (Appendix 4)
INSOLV 13: Kalil v Decotex (Pty) Ltd and Another 1988 (1) SA 943 (A) (Appendix 5)
Labour Relations Act 66 of 1995
Implementation of the Rome Statute on the ICC Bill: working document

SUMMARY
The Committee met in order to conclude the final discussions surrounding the International Criminal Court Bill and the Insolvency Amendment Bill. The Chairperson firmly stated that the Committee would be voting on the Bills at the next meeting in which the Bills would be on the agenda.

MINUTES
The Chair noted that the week starting 3 June 2002 would be very busy in light of the Crossing of the Floor legislation. He explained that he had hoped to deal with it in the meeting today, especially in relation to the consequential amendments to the Municipal Structures Act, but that the Portfolio Committee on Provincial and Local Government had not been able to attend the meeting. They had agreed to deal with the legislation on Monday 3 June 2002 from 14:00pm to 17:00pm. He added that political processes were also occurring in the different departments, and that he hoped that the relevant committees would be able to deal with the political and technical issues relating to the Municipal Structures Amendment Bill by 3 June 2002. He pointed out that the Crossing of the Floor legislation would be dealt with all week except 5 June 2002 when the National Prosecuting Authority would address them in relation to the budget.

The Chair explained that the Committee would be dealing with two Bills in the meeting today, and that he hoped to finalise discussions surrounding the Bills. He pointed out that he had since received many submissions.

Insolvency Amendment Bill 14 0f 2002
Mr T Cronje (Department) stated that he hoped to give the Committee his views on the COSATU supplementary comments. The Chair said that it would not be necessary and asked Mr Cronje to give his views on the Bill. Mr Cronje referred the Committee to the document, Amendments proposed by Mr Cronje (see Appendix 1).

Section 38
Mr Cronje explained that the Chairperson had pointed out that the section did not provide sufficient information regarding the nature of the provision.

Section 38 (3)
Mr Cronje stated that the Chair had asked that the provision be made clearer as he was concerned that the deeming provisions would overrule the provisions of the Unemployment Insurance Act.

The Chair confirmed that the provision had stipulated "in terms of the Basic Conditions of Employment Act".

Mr Cronje explained that nothing had been changed in that regard, and referred the Committee to Point 6 of INSOLV 10. He recalled that COSATU had been worried that the provision would include benefits in terms of other Acts, and reminded the Committee that a proposal made by Business South Africa during the negotiations with NEDLAC had led to the amendment. He explained that his view was that the provision referred only to employment benefits, and that those arising from other Acts would not be covered here (see Point 6.4).

Mr Cronje pointed out that the choice had been to either list the matters to be included in the ambit of the provision, or to make a general provision, thereby leaving the factual analysis to the courts.

The Chair felt that it would be more appropriate to make specific exclusions. Mr Cronje stated that such an approach would be necessary in the requirements of specificity.

In reply to the Chair saying he could not remember making the proposal regarding 38(3), Mr Cronje said that the Chair wanted the deeming provision to be removed.

The Chair stated that the effect would then be to stipulate that persons would be entitled to certain benefits.

Section 38 (4)
Mr Cronje explained that the proposal had been to combine sub 4 and sub 11. He stated that sub 4 dealt with a different issue, and thereby proposed moving sub 4 closer to sub 11.

The Chair pointed out that the provisions had not yet been changed which Mr Cronje confirmed.

Section 38 (5)
Mr Cronje referred to the amendments to S 189 of the Labour Relations Act, and stated that it had been proposed that the wording would have to be incorporated into this section. He directed the Committee to the table of INSOLV 10 highlighting the similarities between the two provisions.

Section 38 (6) (b)
Mr Cronje referred the Committee to Point 4.3 and proposed including a reference to trade unions in the provision.

Section 38 (2)
Mr Cronje stated that the provision would remain unchanged because it would not be possible to have a "meaningful joint consultative process" (see Point 4.3).

The Chair pointed out that sub 6 referred to such a process. He stated that the only difference had been the use of adjectives.

Mr Cronje responded that if anything, the difference would amount to a delay.

The Chair stated that delays would not be possible because the Act stipulated a 45-day period.

The Chair noted that they had just dealt with COSATU's third major concern. Mr Cronje agreed.

The Chair referred to the problems raised by COSATU and stated that:
1. The new amendments could not be accommodated.
2. There had been changes to S 38.
3. The issue of other necessary amendments, currently being discussed. He referred the Committee to the Labour Relations Act 66 of 1995.

The Chair stated that the dismissals were proper because they would be based on operational requirements.

Mr Cronje pointed out that the provisions had been used as a model for the IAA Bill provisions.

The Chair explained that Labour Relations Act would have to be read with INSOLV 10. He pointed out that Mr Cronje was of the opinion that only one amendment would have to be made in that regard.

Section 38 (9)
Mr Cronje explained that Ms Camerer had been concerned that the provision would be open-ended. He noted that he agreed with her in principle.

The Chair stated that the provision was exactly the same. He pointed out that he had never understood the point that had been raised by Ms Camerer (NNP) because the Act made it clear that only 45 days would be granted.

Ms Camerer did not agree with him. Mr Cronje agreed that the position was not clear.

The Chair firmly stated that the Act was clear. He emphasized that it nowhere required a consensus to be reached, and stated that it would be sufficient to attempt to achieve consensus. The result would then be that a time limit of 45 days would exist.

Mr Cronje asked if the proviso of "subject to measures contemplated in sub 7" would not muddle the position.

The Chair repeated that sub 7 required only attempts to reach consensus. However, the 45 day period would be definitive, and that it would not be possible to read it in any other way. He referred to the phrase "appropriate measures".

Ms Camerer responded that his forceful explanation had almost satisfied her completely.

The Chair asked Mr Cronje to explain the words he had added to the provision because they had never been raised before.

Mr Cronje explained that he made the inclusion.

The Chair read "unless the trustee and the employee…..in view of the measures contemplated in sub 6", and stated that the phrase was fair enough. He pointed out that it had been a clever way of dealing with the problem, and that the words "subject to" had been replaced with "unless".

Ms Chohan Kota (ANC) felt that this was a better way to deal with the issue of consensus, raised earlier. She pointed out that the 45 days would be peremptory unless anything happened, and stated that she would have thought that the Chair would have rather given that explanation.

Section 38 (10)
The Chair explained that this was a repeat of sub 4.

Section 38 (11)
The Chair stated that this would remain the same.

Clause 3 (1)
In answer to why this clause had been changed, Mr Cronje reminded the Chair that he had said that it would not be necessary to warn the department.

When the Chair stated that amendment still did not deal with the problem, Mr Cronje explained that it stipulated a cut-off date. The Chair acknowledged the effect. He pointed that this should have been done for S 49.

Ms Camerer was thanked for pointing out the erroneous use of "State" in the phrase " State President".

The Chair noted that the Act would not be able to apply retrospectively.

Mr Cronje agreed and added that this clause clarified that position.

The Chair was satisfied with this clause.

The Chair then explained that COSATU had been concerned with clauses in the Bill that had not been put up for debate. He stated that despite the fact that the period for public comment had expired, the Committee had been urged to hear its comments. He wanted to know the views of Mr Cronje on the matter.

Mr Cronje responded that he had not dealt with it in much detail.

The Chair stated that the general feeling had been that it would be wrongful at this stage, and suggestions had been made to pass a resolution.

Mr Cronje referred the Committee to Point 2 of INSOLV 10 in that regard.

The Chair read Points 2, 3, 4 and 6, and said that they sounded good. He directed Mr Cronje to put the matter in a resolution. However, he pointed out that:-
a) It would have to be made clear that the Committee would not be expressing a view on the desirability of the provisions. Rather, it would not be possible to bring forth comments because the provisions were not part of the Bill. He noted that he personally recognized the desirability of the provisions.
b) It would have to be made clear that the Committee would still be able to hear whether or not the provisions should be included.

Mr Cronje stated that: -
1. He would make the proposal effective.
2. Point 3.3.3 of INSOLV 12 indicated that the matter had been agreed upon by NEDLAC. Thus it would be necessary to include that in the resolution.
3. COSATU disagreed with his statement in Point 2 of the resolution, and referred the Committee to INSOLV 8 [Appendix 3] in that regard. He explained that he did not agree with them, and referred the Committee to the court judgement on Kalil v Decotex 1988 in order to support his view [Appendix 5]. He stated that the IAA would become applicable only once liquidation proceedings had begun.

The Chair wanted to know the effect of the dispute between Mr Cronje and COSATU.

Mr Cronje responded that the Committee could avoid any problems by stating that it would be dealt with in subsequent matters as indicated by NEDLAC.

The Chair stated that Mr Cronje would therefore not form an opinion.

Mr Cronje stated that it would not be necessary for the Committee to form an opinion.

The Chair directed Mr Cronje to be mindful of the process of public comment. He said that Mr Cronje would have to be careful when drafting the resolution.

The Chair explained that the Committee had dealt with all the issues. He pointed out that: -
a) The clauses not in the Bill would be dealt with by way of resolution.
b) The heading would be changed.
c) The difference of opinion between COSATU and Mr Cronje would have to be considered.

The Chair wanted to know whether there would be other employment benefits in relation to the wording proposed by COSATU.

Mr Cronje gave the example of provident funds and retirement funds outside the contract of employment.

The Chair said that although the concern was valid, he did not think that it applied to S 38 (2) (b). Nevertheless, he wanted to know whether the use of the wording proposed by COSATU, "severance and leave pay", would result in the exclusion of other benefits.

Mr Cronje apologized for failing to respond to the question. He stated that other benefits would not relate to the contract of employment.

The Chair suggested that it would therefore be safer to adopt the wording proposed by COSATU.

Mr Cronje confirmed that the Committee would have to state what it meant, and referred to benefits in terms of the Basic Conditions of Employment Act.

The Chair pointed out that he was inclined to agree with the view that had been put forward by Mr Cronje.

Mr Cronje responded that he had not been able to find other benefits in terms of the Act.

Adv Masutha (ANC) conceded that provident and pension fund benefits arose out of different contractual relationships. However, he felt that there were other benefits that would accrue to the employee as a result of the employment contract, the benefits themselves belonging to a contract outside of the employment contract. Thus he asked what the determining factor would be.

The Chair pointed out that he was now vacillating towards Mr Cronje, and responded that it would be the contract of employment. He stated that they would only be able to deal with benefits arising out of the employment contract. He noted that this would be necessary in order to prevent the creation of laws with the ability of extending into the private domain.

Adv Masutha made a distinction:
a) there were benefits in terms of the Basic Conditions of Employment Act that arose from the contract of employment.
b) there were benefits arising out of the contract of employment, but that it would be possible that these would not be in terms of the BCEA.
c) there would also be benefits arising out of other contractual relationships, and gave the example of lump sums. He said that they would derive from the employment contract in a sense, but that they would involve a third party.
He explained that the three scenarios would possibly have to be treated separately.

The Chair explained that the Act purported to deal only with benefits referred to in the first scenario.

Adv Masutha responded that the safer route would then be to use the wording proposed in the Bill, because it could be interpreted conservatively to exclude benefits not arising directly from the contract of employment.

The Chair added that he magic words were "in terms of the contract of service", and that it would be more appropriate to follow the cautious literal route.

Ms Chohan Kota pointed out that in light of (a), it could be possible to establish other agreements giving rise to employee benefits. However, in the cases of the other benefits, other legislation would apply in order to protect the employees. Thus although she agreed that it would be necessary to go narrow, she did not feel that the provision was narrow enough.

The Chair stated that it referred only to employment benefits out of the contract of employment.

Ms Chohan Kota proposed the inclusion of the word "that".

The Chair referred to "any" contract of employment.

Adv Masutha proposed the phrase "suspended in terms of any provision of this Act".

The Chair responded that the position was clear in sub 1.

Mr Cronje expressed concern with the point raised by Adv Masutha. He proposed the phrase "the contract of employment that is suspended".

The Chair added that "in terms of the contract of service which is suspended" would be much clearer. The Committee was satisfied.

The Chair stated that sub 3 was apparently his doing. He noted that the position had been stated clearly.

Adv Masutha agreed with the formulation proposed by the Chair. Nevertheless, he wanted to know the rationale behind the deeming approach.

Mr Cronje responded that it had nothing to do with the wording of the Unemployment Act.

The Chair stated that sub 4 would now be sub 10. He noted that there would not be any changes to sub 4.

The Chair explained that sub 5 referred to the issue raised by COSATU in relation to S 189 of the Labour Relations Act. He explained that the clause had been taken from S 189, and that because he was not fully knowledgeable of S 189, he relied on what Mr Cronje was saying.

The Chair referred to the inclusion of creditors and pointed out that he did not agree with COSATU. He explained that they were dealing with a dismissal process and that it was a voluntary process. He stated that because of legal consequences such as the exclusion of other creditors, the Committee would not be able to follow that route.

The Chair referred to the other concern raised by COSATU in relation to the provisional trustee, and stated that the wording of sub 4 seemed to make it clear that termination could only occur upon the appointment of a trustee.

Mr Cronje agreed with the Chair and referred the Committee to Point 3 of INSOLV 10. He said that that the provision clearly applies to a final trustee.

Clauses 38 (5), 38 ( 6), 38 (7), 38 (8)
The Chair repeated that they dealt with the consultation process.

Clause 38 (9)
The Chair explained that the provision referred to a trustee appointed in terms of S 56. He went on to say that S 56 made provision only for the appointment of a final trustee. He noted that this was how he looked at the matter. Nevertheless, he stated that although he understood the point made by COSATU, he was relatively sure that this was the meaning to be attached.

Mr Cronje added that although a provisional trustee would be able to and actually should consult in the process, a provisional trustee would not be able to terminate contracts.

The Chair repeated that it was clear that the provisional trustees would not be able to terminate contracts.

Ms Chohan Kota explained that as sub 4 stood, it meant that a final trustee would be able to terminate the contract between 21days and 45days. She said that this would be in terms of S 5, S 6 and S 7.

The Chair stated that the 21days referred to the appointment of a trustee.

Ms Chohan Kota stated that she was not raising that point, and repeated her point.

The Chair acknowledged that she made a good point. In that regard, he wanted to know why sub 4 would be necessary.

Ms Chohan Kota explained that as she had understood the submissions, it would be intrinsic in negotiating a sale that flexibility would be necessary.

The Chair stated that sub 4 would have to be read with sub 5, sub 6 and sub 7. He added that a trustee would have to be permanent. Nevertheless, he confirmed that the point she was making was that the election could be made between 21days and 45days. However, the position of the provisional trustee remained unchanged.

Ms Chohan Kota added that the days would have to be interpreted from the appointment of the final trustee.

The Chair pointed out that 45days would be the limit whilst 21days would be the minimum. He said that this would give an appointed trustee approximately 3weeks within which to make an election.

Mr Cronje referred to Point 3.5, and stated that sub 9 dealt only with final trustees.

The Chair agreed. He added that there would be either automatic termination after 45days, or alternatively sub 4 would allow termination by the final trustee from 21days to 45days. Thus the issue of a provisional trustee would not be a problem.

The Chair asked the floor whether they were in agreement in relation to the provisional trustee issue and the interpretation issue.

Ms Chohan Kota wondered whether it would be correct therefore to move sub 4 from where it currently was placed.

The Chair corrected her. He explained that the old clause 4 had been moved, and that the present sub 4 used to be clause 5.

The Chair felt that they had dealt with COSATU as best as they could. Nevertheless, he stated that he would still be prepared to engage Ms P Govender of COSATU in relation to S 189 of the Labour Relations Act. He noted that Mr Cronje had picked up one principled matter, and explained to her that if she felt there would be more issues in that regard, she should firstly engage Mr Cronje and then the Committee.

The Chair explained that other than subclauses 4, 5 and 6, there was nothing there. He repeated that trade unions would be incorporated because they clearly had to be there.

Clause 38 (8)
The Chair referred to the exclusion point raised by COSATU and repeated that they would not be able to do that.

Clause 38 (9)
The Chair was happy to go with the provision as it stood. Although he could not be sure of the consequences of the use of the word "unless", he approved the provision of greater flexibility.

Mr Cronje reminded the Committee that a member had pointed out the problem with Close Corporations. He explained that Close Corporations had a different process because there would be no appointment of either provisional or final trustees. Thus he could not be sure how S 56 would be interpreted when dealing with these business forms.

The Chair was pleased that Mr Cronje raised the problem. However, he wanted a solution.

Mr Cronje stated that he would have to look into it.

The Chair explained that he would be able to do that because they would not be voting on the Bill in the very next meeting.

Ms Chohan Kota asked for an overview of the process in the Close Corporations.

Mr Cronje explained that a liquidator would be appointed, and that provision was made for the appointment of an additional liquidator. However, they would not be referred to as provisional or final trustees.

The Chair proposed dealing with the two positions separately in sub 4 and sub 10. He pointed out that sub 4 would also have to be changed in light of the proposal made by Ms Chohan Kota. He asked Mr Cronje to look into that as quickly as possible and phone him informing him about the position. He added that the final amendments would have to be ready at least by Tuesday 4 June 2002.

Clause 38 (10) and Clause 38 (11)
The Chair stated that these would remain exactly the same.

Clause 3
The Chair asked the floor whether they had any problems with the provision.

The Chair explained that Mr Cronje would have to make the amendments very quickly. He added that Ms Govender would have to contact Mr Cronje regarding further issues, and stated that Mr Cronje would have to phone him in the event of that. He thanked him for coming at such short notice, and acknowledged that Mr Cronje had been put under pressure.

International Criminal Court Bill 2002
Mr Basset (Department) explained that he had brought with him the new draft of the Bill, the Committee resolution, and the memorandum. He apologized for the absence of Adv Pienaar, and he introduced Mr Van Rensberg to the Committee. He added that they would be working hard in order to meet the deadline set for 31 July 2002.

The Chair could not remember stipulating that. Nevertheless, he was pleased with the initiatives taken by Mr Basset. He explained that he had looked over the Bill in detail and that he had picked up a few more issues. However, the vast bulk of the Bill was satisfactory.

Long Title
The Chair began by stating that although the two issues had been beautifully divided, this had not been done in the long title. He added that at the very least, it would be necessary to include the creation of the three crimes of genocide, crimes against humanity and war crimes.

Preamble
The Chair pointed out that it read nicely. However, he felt that the second point would have to be split, from "the RSA….community of nations" to "and is committed". He stated that it would be more appropriate to begin another point providing that "mindful that the RSA is committed to".

Index
The Chair stated that the index would be satisfactory.

Definitions
The Chair pointed out that there had been a change to the definition of "crime" in that S 4 (1) (b) had been deleted and that it had been replaced with the insertion of a definition of "crime". He noted that this was in light of the concerns raised by Adv Masutha.

Adv Masutha explained that the style used was differently from that which one would be ordinarily accustomed to. He stated that (a), (b) and (c ) would not be listed separately.

Mr Basset added that he also had reservations about the provision being unusual.

The Chair stated that it could be necessary to create 3separate definitions of the 3crimes, and then to have one definition of "crime" containing the 3separate crimes.

Adv Masutha stated that the object of modern drafting would be to make the document as easy as possible to read.

The Chair agreed and added that it would be incorrect to include a definition within a definition.

Applicable law
Mr Basset reminded the Committee that The Chair had asked that the word "also" be moved from being further down.

Adv Masutha referred back to the definition of "prisoner" and pointed out that it did not refer to the serving of a sentence under any particular law. As a result he could not be sure that the definition would suffice.

The Chair referred back to the list and suggested that it could be in that regard that the our law would not be referred to.

Adv Masutha stated that notwithstanding the point made by the Chair, the provision would still be insufficient. He emphasized that they would have to be consistent with the rule of law.

The Chair asked for clarification regarding the particular part of the provision that would be vague.

Adv Masutha referred to paragraph (a) and said that it would be necessary to stipulate "to serve a sentence in terms of any law whether domestic, international or foreign". He pointed out that it would be possible to serve a sentence in terms of an arrangement and not in terms of the law, and gave the example of Cuba. He firmly stated that the Act clearly hoped to operate within the framework of the law.

The Chair directed Mr Basset and Adv Masutha to sort out the wording.

Clause 2
No comment.

Clause 3
Mr Basset stated that the first change had been in respect of 3(2). He reminded the Chair that he had asked for the first instance to be brought forward in the sentence.

The Chair referred to the phrase "object of this are to" and asked Mr Basset to remove the "to" in light of subsection (d). He added that the phrase "in the first instance" would have to be removed and replaced by the statement "to enable, as far as possible and in accordance with the principle of complementary, the National Prosecuting Authority of the Republic to prosecute, and the High Court of the Republic to adjudicate". He wondered whether it would be necessary to make a reference to the objects of the Bill.

Mr Basset responded that such a reference would make the provision more emphatic.

The Chair directed him to include a subsection (c ) indicating that position, the result of which would be that the current subsection ( c) would then move down to subsection (d). Subsection (d) would then move down to subsection (e).

Chapter 2
Clause 4 (1)
The Chair reminded the Committee that 4(1) had been deleted because of the problem that had been brought to the attention of the Committee by Adv Masutha.

Clause 4 (2) (b) (ii)
The Chair suggested adding the phrase "a ground for any possible reduction of sentence once a person has been convicted of a crime". He noted that although the phrase was pretty obvious, it would have to be included.

The Committee was satisfied.

Clause 5 (2)
The Chair explained that the provision contained two options. However, he felt that it should rather refer only to "on or after" 1 July 2002.

The Chair wanted to know whether there was any possibility that the Rome Statute would not be in operation by 1 July 2002. He explained that if such a possibility existed, it would be safer to stipulate "before the commencement of the Rome Statute".

Mr Basset did not think that such a possibility existed.

Mr Van Rensburg thought that the safer option would be to stipulate "before the commencement of this Act".

The Chair pointed out that making such a provision would provide the department with the opportunity to sit on the Bill. He added that the Committee had had bad experiences with the department. Nevertheless, he emphasized that the Bill would have to be operative by the date of enforcement of the Rome Statute.

Ms Chohan Kota felt that it would be better to provide "from the date of commencement of the Rome Statute".

The Chair agreed that her proposal would be legally safer. However, he stated that the public announcement would indicate that the Bill would become operative on 1 July 2002.

Ms Chohan Kota wanted to know then why it had been suggested that the Statute would not be in operation by 1 July 2002.

The Chair proposed that the Committee adopt the safer route. He noted that he had hoped to make the position clearer.

Adv Masutha pointed out that the Committee would have to make a distinction between:
The date of commencement of the Rome Statute.
The date of commencement of the ICC Act in terms of clause 40.
The date on which crimes would become applicable, the issue that was currently being discussed.
He felt that the Committee should adopt the date on which the ICC Act would become operative.

The Chair said that 5(2) would provide "before the commencement of this Act". He added that Clause 40 would then stipulate the date of 1 July 2002.

Adv Masutha stated that the Committee would have to hope that there would be a clear arrangement with the President's office because the President would not be subject to any legislative provisions in relation to assenting to the Bill.

The Chair referred to the Walter's judgement and illustrated that the Presidency had been kindly reprimanded for its failure to deal appropriately with Section 49. He stated that the Presidency had a duty to either sign a Bill, to refer it back to Parliament or to send it to the Constitutional Court. Thus the Presidency would have to exercise its public power without any discretion.

Adv Masutha wanted to know what would happen in the event that the President chooses to exercise other options in terms of the Constitution. He stated that unless the Bill were to provide "on the date the President assents to the Bill or the date upon which the Rome Statute becomes operative, whichever is earlier", there would definitely be a problem.

The Chair wanted to know what would stop them as the legislature from stipulating a date.

Adv Masutha responded that a Bill would only become operative once assented to.

Ms Chohan Kota agreed with Adv Masutha. However, she felt that there would be nothing stopping the Committee for allowing the retrospective operation of that Act to that extent. She added that there would be a rational link between the obligations of South Africa and the retrospectivity. She pointed out that she was concerned with imposing a date for assenting because should the President fail to comply, his actions would be open for challenge.

The Chair stated that the Constitutional Court had expressed itself on the matter in the Walters judgement, in terms of which it would be the prerogative of Parliament to make a decision regarding the date of inception. Thus he had difficulty seeing how there would be a problem.

Ms Chohan Kota explained that she did not disagree with the principle. Nevertheless, she stated that courts had consistently held that prerogative powers could be tested against the rule of law, thereby narrowing the powers. Her difficulty was that in the event of the President failing to meet a deadline set by Parliament for whatever reason, the Act could then be challenged because of that.

The Chair stated that the Act could not be challenged.

Ms Chohan Kota explained that if the argument made by the Chair was correct, this would mean that the President need not consent and that law becomes law. She felt that such a position would make the law vulnerable. Nevertheless, although she acknowledged that a law of this nature would require regulation, it would be more logical to allow for retrospective operation of the Act to that extent.

Adv Masutha made a distinction:
He explained that in the Walters judgement, the appeal was to have the Act operationalised because the President had failed. However, the Act had been assented to. In the case of the provision currently being discussed, operationalisation would not yet have taken place because law could only become law upon Presidential assent. He explained that the Constitution provided the President with a discretion when dealing with Bills. Thus the possibility existed the deadlines would not be met, the result being that the statutory date would contradict the real situation. In light of this, it would be necessary to clarify the position.

The Chair agreed with the point that had been made. However, he pointed out that the task of the Committee would simply be to pass Bills. He added that he was fighting for the rights of Parliament to decide when Bills could become operative, and that this would require the Committee to assert itself. He felt that the Constitutional procedures would not affect them and that they should stipulate the date.

Ms Chohan Kota agreed with the conclusion reached by the Chair. However, she explained that in the event of the President failing to comply with the procedures provided for, his actions would become challengeable by persons prosecuted under the Act. She stated that this would make the Act vulnerable.

The Chair responded that Ms Chohan Kota was theoretically correct. However, in practical politics, such a situation would not occur.

Ms Chohan Kota repeated her point and gave the example of mundane day to day problems causing the President to fail to meet the deadline. She stated that accused persons would be able to challenge the law based on that issue.

Adv Masutha agreed with all the points that had been made. As the Chair had explained, if the President fails to meet the date, in terms of the Constitution the Bill would still be a Bill. Thus the commencement could not be binding on anyone at that stage. However, he agreed with the interpretation problem raised by Ms Chohan Kota. He said that the implication was that they would indirectly apply the principle of retrospectivity. Nevertheless, this would have to be expressly provided for. Thus he felt that his proposal would be most appropriate.

The Chair responded that the Act would still be challengeable in that event by virtue of the Constitutional requirement that the President must assent to a Bill before it becomes an Act.

Adv Masutha explained that they would effectively be stating that the date of commencement is particular, but that in the event of the law failing to become operative, commencement would be from the date that the Bill becomes law.
The Chair explained that this would still be challengeable in the event of a conflict. Nevertheless, he liked the reasoning advanced by Adv Masutha and stated that it would offer a potential solution. Nevertheless, he proposed the removal of the date and the consequent granting of authority to the executive.

Ms Chohan Kota was worried that the proposal by Adv Masutha would not necessarily deal with the S 49 type scenario. She pointed out that a problem with the retrospectivity clause is that Parliament would also be intruding on executive powers.

The Chair explained that these Bills had been drafted by the legal advisors from the previous Parliament.

Ms Chohan Kota referred to the rationality and reasonableness tests.

The Chair pointed out that they had engaged in a very interesting discussion.

Adv Masutha appreciated the arguments made by Ms Chohan Kota. However, he felt that when dealing with operationalisation, any affected party would be able to approach the courts. Thus it would not be a technicality problem but rather a problem with the exercise of rights.

Mr Van Rensberg remarked that once the Bill would be sent to the Presidency, there would be functionaries with the task of ensuring that the President has assented. He noted that it would be the work of Mr Basset. Nevertheless, he proposed that Parliament set a date in order to enable the department to operate effectively.

The Chair commented that they were dealing with a very strange clause.

Mr Basset proposed retaining Clause 40 as it stood and including the date in a resolution by the Committee.

Adv Masutha added that they would make provision for the Constitutionally sanctioned retrospectivity.

The Chair emphasized that he had withdrawn his suggestion.

Ms Chohan Kota stated that clause 5 (2) would remain in its current form.

The Chair directed Mr Basset to keep S 40 as it stood, and to draft a resolution stipulating that the Committee would like the Bill to be operative by 30 June 2002.

Clause 10
The Chair felt that the last part of the provision would not be in line with the Statute. He stated that S 10 (8) would have to be redrafted to state that a court would have to deal with the matter in relation to the three grounds. He pointed out that the appeal procedure would have to be properly regulated.

Mr Basset explained that both Mr Van Rensberg and he felt that they could run into problems with the Rules Board.

The Chair responded that they would not have to be finalized in that regard before 1 July 2002. He added that the Rules Board could be given 6months to sort out the appeal procedure.
Adv Masutha wondered whether they could suspend the coming into operation of that particular aspect of the Bill.

The Chair replied that he would let the department look into that. He asked Mr Basset to make the amendments available to the Committee as soon as possible.

Mr Basset referred to the Hyundai judgement and explained that he had reservations regarding S 30 (2).

The Chair told him to correct the problem in accordance with the reservations.

The meeting was adjourned.