Merchant Shipping (Civil Liability Convention) Bill [B20-2013] & Merchant Shipping (International Oil Pollution Compensation Fund) Bill [B19-2013]: deliberations

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20 August 2013
Chairperson: Ms N Bhengu (ANC)
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Meeting Summary

The Maritime Law Association of South Africa (MLASA) presented its submission to the Committee and the Department of Transport on the Merchant Shipping (Civil Liability Convention) Bill, 2013 and the Merchant Shipping (International Oil Pollution Compensation Fund) Bill, 2013.

There were three areas of concern regarding the submission. Firstly, there were the two Bills being deliberated at present, but waiting in the wings and being driven by Treasury were two other Bills -- the Money Bill and the Administration Bill -- which had an effect on these Bills. They did not fall within the ambit of the Department and were outside of its control. The effect of the Money Bill is that once this legislation is passed, the limitation in respect of pollution incidents from tankers on South Africa’s coast will rise to around R3.2 billion. However, that money comes from a fund in London, which gets its money from contributions by importers of oil into the country. Treasury has to collect these premiums and pay them to the fund in London, and then claims can be made for any pollution damage. It was imperative that the Money Bill went through at the same time as the Fund Bill, because otherwise there would be a structure in place, but no money being collected.  MLASA had received an assurance that the Bills would progress together at the same pace.

The second concern was that before 1994, because of South Africa’s history and apartheid in particular, the country could not always accede to conventions because of its political position, and the government used to take pieces of international conventions and draft them into law. This meant that it currently had a patchwork of marine pollution legislation. There were bits and pieces of legislation lying all over the statute books. The current Bills attempt to enact the entire international convention into domestic legislation, which MLASA supports entirely, but this will have a significant degree of overlap with other pieces of pollution legislation, in particular the Marine Civil Liability Pollution Act and the Marine Control of Pollution from Ships Act. The concern is that other Acts will have to be amended, otherwise there will be competing pieces of legislation. It is critical to pass these Bills through into law, and there should not be a delay in doing this. The Department and the SA Marine Safety Association (SAMSA), in response, have assured MLASA that the amendments will be dealt with as a matter of urgency

The third area of concern related to two major definitions in the Bills -- the first relating to the jurisdiction of the High Court being over twelve miles, and the second relating to SAMSA’s power of detention, as prescribed in the Bills.  It was felt that the jurisdiction provision was hollow, as no other division of the High Court had jurisdiction over twelve miles, and that giving SAMSA the power to detain ships that polluted went against the Civil Liability Convention, while SAMSA still had the power to arrest these ships.

The Department, together with SAMSA, responded to MLASA’s submission. It was working closely with the National Treasury to ensure that the Bills that complemented each other would be proclaimed simultaneously. It acknowledged that amendments would need to be made to avoid overlapping legislation. The State Law Advisors would provide assistance in relation to the jurisdiction issue. SAMSA agreed that it was not necessary to have the power of detention in the context of the Bills, as it had the power to arrest, as well as the power of detention outside of the Bills’ context.

Members asked many questions of clarity, particularly on the difference between the power to arrest and the power to detain. The Chairperson expressed her disappointment that, in a designated maritime year, there was still much of South Africa’s maritime legislation that lagged behind international laws and conventions. Members were worried that Treasury was not aware that its Money Bill needed to be processed simultaneously with these Bills.

The Committee agreed to accept a late submission from the Cape Bar Council and asked the Department, SAMSA, the State Law Advisors and MLASA to use it in drafting their amendments. 

Meeting report

Opening Remarks
The Chairperson said that there was just one item on the agenda, as the Committee’s meeting last week was very short and had been postponed. The purpose of the meeting was to consider and deliberate the Merchant Shipping (Civil Liability Convention) Bill, 2013 and the Merchant Shipping (International Oil Pollution Compensation Fund) Bill, 2013, which were interrelated. This was supposed to have been done last week, but had had to be postponed for a number of reasons. Firstly, there was a submission that had come from MLASA but, because of work-related commitments, it could not be present.   The Committee had attempted to proceed with its meeting, however, and had looked at the written submission of MLASA. In terms of parliamentary procedure, it could have proceeded if the Department had gone through the written submission with the State Law Advisors, but the State Law Advisors had said that they had not engaged with the organization that had made the submission.  The Department has implementing agencies, and whenever a Bill is processed, it requires an agency to process it. The implementing agency, in this case SAMSA, was not present and the Committee could not get the views of SAMSA, as the implementing agency.  The delegation from the Department should always be led by the Director General (DG) of the Department, as accounting officer. If the DG is not present, a letter of apology should be submitted indicating who would lead and represent the delegation from the Department. Last week, a letter was received stating that the Deputy Director General would lead the delegation, but the Chief Director came instead and was not prepared, as she had only been informed about the meeting the previous evening, and no proper coordination had been done. Therefore the meeting could not go ahead.

Today, the Committee hoped that proper coordination had been done in terms of the submission.  In addition to the submission, a legal opinion had been drafted by the Cape Bar Council, but it had not followed the correct procedure in terms of the closing date.  The Committee would guide the issue of this submission on how it would be treated, as it did not follow procedure and had been received late.

The Chairperson welcomed Ms Sindi Chikunga, the Deputy Minister of Transport, who was also responsible for maritime matters in the Ministry, and offered her the opportunity to address the Committee.

Deputy Minister’s opening comments

The Deputy Minister thanked the Chairperson and apologised for the problems which affected last week’s meeting. The Ministry agreed that any Portfolio Committee meeting attended by the Department must be led by the DG and, in the event that the DG cannot attend, the Deputy Director General should represent the Department, supported by officials from the relevant branch. The Deputy Director General should be the most junior person leading a delegation, so it should never be a Chief Director. When people attend meetings in Parliament, it must always be somebody who is able to make decisions on behalf of the Department.  What happened last week was not acceptable.  She agreed with the Chairperson and the Committee’s decision to postpone. The Ministry expected the Department to be prepared when attending meetings, because it was very costly to come to Cape Town from Pretoria, and also costly for the Portfolio Committee. The Ministry regarded the Bills as important and was keen to move forward with them.

The Chairperson thanked the Deputy Minister for coming to put the record straight. The Committee felt undermined last week by the Department, because it was unprepared, implying that it did not take the Committee seriously. There would be a multiparty delegation meeting with the Minister tomorrow to raise its concerns, because it felt undermined.  The postponement had had an impact on the entire programme of the Committee. The election year is short, and the Committee was inconvenienced greatly. The Bills were supposed to be finalised today, not deliberated. This was not a small matter, and she hoped that Deputy Minister could take it up with her Department.  

Submission by the Maritime Law Association of South Africa
Mr Malcolm Hartwell, president of MLASA, thanked the Chairperson for the opportunity to speak to the Committee, with a view to assisting it in the deliberations.  Since initially making the submission, MLASA had had a meeting with the Department and SAMSA, and could say that the parties had reached agreement on almost every aspect that concerned MLASA in relation to both of the Bills.  MLASA is a voluntary association of shipping lawyers with about 250 members, most of whom are practitioners in private practice, and has engaged with the Department for a number of years, meeting in Pretoria and assisting with the drafting of legislation. These two Bills have been projects that have been ongoing and it has been involved in discussions with the Department. MLASA has a very open and helpful relationship with the Department.

Mr Hartwell said that there were three areas of concern regarding the submission,. Firstly, there were the two Bills being deliberated at present, but waiting in the wings and being driven by Treasury were two other Bills -- the Money Bill and the Administration Bill -- which had an effect on these Bills. They did not fall within the ambit of the Department and were outside of its control. The effect of the Money Bill is that once this legislation is passed, the limitation in respect of pollution incidents from tankers on South Africa’s coast will rise to around R3.2 billion. However, that money comes from a fund in London, which gets it money from contributions by importers of oil into the country. Treasury has to collect these premiums and pay them to the fund in London, and then claims can be made for any pollution damage. It was imperative that the Money Bill went through at the same time as the Fund Bill, because otherwise there would be a structure in place, but no money being collected. MLASA had received an assurance that the Bills would progress together at the same pace.

Mr Hartwell said that the second concern was that before 1994, because of South Africa’s history and apartheid in particular, the country could not always accede to conventions because of its political position, and the government used to take pieces of international conventions and draft them into law. This meant that it currently had a patchwork of marine pollution legislation. There were bits and pieces of legislation lying all over the statute books. The current Bills attempt to enact the entire international convention into domestic legislation, which MLASA supports entirely, but this will have a significant degree of overlap with other pieces of pollution legislation, in particular the Marine Civil Liability Pollution Act and the Marine Control of Pollution from Ships Act. The concern is that other Acts will have to be amended, otherwise there will be competing pieces of legislation. It is critical to pass these Bills through into law, and there should not be a delay in doing this. The Department and SAMSA, in response, have assured MLASA that the amendments will be dealt with as a matter of urgency

Mr Hartwell said that the third area of concern is merely the tidying up of definitions. These definitions had been dealt with, and MLASA had agreed with the State Law Advisors on all issues, save for two concerns, which would be elaborated on. MLASA understood that these would be sorted out afterwards.
The first major concern regarding definitions related to the High Court having jurisdiction within twelve miles of its territorial water. The Convention stated that for any pollution within 200 miles of its coast, South Africa’s courts should have jurisdiction to deal with it. This was a very special extension of the jurisdiction. Section 7 of the Merchant Shipping (Civil Liability Convention) Bill states that all of the High Courts should have jurisdiction over the exclusive economic zone, and MLASA has no difficulty with this. Section 8 of the Bill contemplated two scenarios. The first scenario is if there is a claim in a court for pollution damage, then that court has jurisdiction for 200 miles, with which MLASA agrees. The second scenario, described in Section 8 1(b), is that in any other case, any division of the High Court with jurisdiction would hear the claim. The challenge that this provides is that no other division of the High Court had such jurisdiction beyond the twelve miles. MLASA was sure that this issue could be resolved in the drafting, with SAMSA and the State Law Advisors.

Mr Patrick Holloway, Director of MLASA, said that the second concern related to SAMSA’s power of detention. He provided a practical example to put it into perspective. The ship that ran aground last week on the East Coast was refloated and taken out to sea, and all those involved had hoped that the ship would be saved and brought into a South African port. If that had happened, the ship would have been arrested immediately by the owners of the cargo of that ship, which was worth about R60 million. The ship itself was probably worth about six or seven million dollars. The owner of the ship, in terms of current South African legislation, could limit total liability to about R33 million. Assuming that the costs involved were more than R33 million, there would be a significant shortfall and the owner of the ship would have used his right to limit the liability to R33 million, based on the size of the ship, and would be obliged only to pay claims up to this amount and not up to the R60 million that existed.

Looking at the provisions of the Merchant Shipping (CLC) Bill, Sections 15 and 16 provided for expenses charged on the ship, and SAMSA may detain the ship until the amount is paid, or security for the payment of that amount, is provided to the satisfaction of SAMSA. These clauses are in direct contradiction with the specific provision of the CLC fund, which states that no claim for compensation for pollution damage may be made against the owner, other than in accordance with this Convention. In the example, with the Convention in place, the ship would have been arrested and the owner of the ship would have had to use the fund. This provision required that all the arrests would fall away. Section 16 is in contradiction with Article 3, sub-paragraph 4, which provides for a channeling of liability to the ship owner, or directly against the ship owner’s insurer. In the event that the ship owner was not liable or could not pay, the claim would then be against the second tier of insurance cover, which would be against the International Oil Pollution Compensation (IOPC) fund in London.  MLASA believes that the provision that allows SAMSA the right to detain ships is contrary to the provisions of the Convention. MLASA understood why the State would want to allow SAMSA to detain the ships.  However, the correct procedure would be, in such an instance, for SAMSA to arrest the ship, rather than detain it, and in the event that security was established, it would then have to release the ship.  In the case where the ship owner subsequently decided to limit the liability by establishing a fund to the maximum amount of its liability in South Africa, however, the security that had been provided up to that point would have to be released. MLASA believed that Part 4 of the Bill was unnecessary and not required, and should therefore be deleted.

Mr G Krumbock (DA) asked for clarity on the submission with regard to the document received the previous week.

Response from the Department of Transport  
Advocate Adam Masombuka, Chief Director for Legal Services for the Department of Transport, confirmed that the Department had met with MLASA to work out areas where there was confusion caused by the drafters’ amendments to the Bills. In this discussion, the parties agreed on a number of areas. A larger group had also met this morning and to a certain extent the response document, based on the outcome of the meeting over issues of whether it liked the protocol, or whether it liked the Convention, might be relevant. What the parties agreed on was that they needed to stick to what is provided for by the Bill and give effect to the protocol, rather than to the Convention. The State Law Advisor would elaborate on this.

In response to the MLASA’s concern that the Bills must be processed simultaneously with the other Bills processed by Treasury, he said that the Department had been in constant discussion and consultation with Treasury when it was trying to bring these Bills to Parliament. Ultimately, starting from last year, it has yet to see progress with its interaction with Treasury. Of late, the Department was sure that Treasury knew that it wanted to see the Bill processed and had agreed with it, in order to process the complementing Bills.  The Department agreed with MLASA that it is imperative that the Bills are enacted simultaneously, and Treasury is fully aware of this. Its aim is that once the Bills were published into law, to proclaim them on the same day. The Department would make sure that the Merchant Shipping Bills were processed and that Treasury was processing its Bills, so that they can be proclaimed simultaneously. Regarding the point of overlapping legislation, including the Marine Pollution Act, the Department agreed that amendments needed to be made to these Acts. The issue of the jurisdiction of court had been raised and would be looked at by the State Law Advisor. Regarding the issue SAMSA’s power of detention, SAMSA would respond directly.

Mr Tsietsi Mokhele, Chief Executive Officer of SAMSA, endorsed the Deputy Minister’s apology and said that, as a team of transport, it needed to get its house in order.  Last week’s situation was regrettable and was the result of a failure to coordinate better. He acknowledged the partnership that had evolved over time between SAMSA and MLASA, and SAMSA was grateful for the amount of time and resources committed by MLASA towards assisting and promoting legislation. One should be mindful of the fact that MLASA said it should be policy which guided the developments in legislation. It had been calling on SAMSA to provide clarity over policy, so that there is not a situation where it appears that the parties are not committed to the same thing. It may appear as if there are areas of disagreement, purely because different parties are interpreting all of the work they are doing in a vacuum.  To that extent, SAMSA wished to clarify that the issues of its power to be able to intervene within the context of the fund, was not an area of disagreement between itself and MLASA. It did recognize the fact that there were other pieces of legislation that allowed for both arrest and detention. In the context of this issue, SAMSA would like MLASA to clarify their concern. The power to arrest was not in contention, but the power to detain was. If SAMSA and MLASA could see eye-to-eye on this issue, SAMSA would then accede to that and would therefore support the position.


Mr I Ollis (DA) asked for clarity on whether SAMSA agreed with MLASA, to amend a sentence in the Bill.

Mr Mokhele said that SAMSA had asked MLASA to clarify whether there may be a need for it to intervene. The issue was between arrest and detention. SAMSA would concur if detention was not needed to intervene, but arrest was.

Mr Hartwell said that there was no issue with SAMSA arresting ships for claims for pollution damage.  He thought that it must have this power to arrest, which was given to it by the Admiralty Act, but  SAMSA should not, in addition, have the right to detain ships.

The Chairperson said that SAMSA and MLASA were in agreement that SAMSA should have power to arrest, but not to detain. She asked who had the power to detain.

Mr Hartwell said that SAMSA would approach the court and the court would issue an order or a summons for the arrest of a ship.   However, the power of detention is something that SAMSA enjoys under other Acts, but it does not enjoy this power under the Convention to detain a ship for pollution damage.  MLASA understood that SAMSA would be happy with this position, and the effect of this would be that Sections 15 and 16 of the Bill would be deleted.

The Chairperson asked if the issue of detention was taken care of in another Bill, and as a result of that, this particular Bill did not necessarily have to give this power.

Mr Hartwell said that SAMSA had the power to detain in other areas, but did not need power to detain for pollution damage, as it had power to arrest, and this would go against the Convention.

Ms N Ngele (ANC) asked what the difference was between power to arrest and power to detain.

The Chairperson explained the difference in her mother language.

Mr Mokhele said the consensus is based on that understanding, to the extent that the power to detain is there in pieces of other legislation, and that SAMSA was stepping back from detention in this context, but not in other contexts.

Mr Ollis asked if the reason that SAMSA did not need to detain was because the fund made provision to cover the damage. The international Convention was saying that it did not need to detain, and prohibited it.

Mr L Suka (ANC) said the presenters had an issue around definitions. There were two definitions that they wanted clarity on. He asked for clarity on the question of the jurisdiction of the High Court for twelve miles, and the issue of a maximum claim being R33 million if the actual amount was higher than the maximum. He asked for clarity on the fund in London and the role of South Africa in relation to this fund. He said that there was a sense of urgency to amend or repeal other Acts to correspond with these Bills, because of the patchwork of legislation, and asked how far down the line this process was.

Mr P Mbhele (COPE) asked if SAMSA should not have the power to detain when it was related to pollution-related felonies, but should not have the power for any other maritime felonies.

Mr Hartwell said that he would clarify exactly what an arrest was and why it was so important. Anybody that has a claim against a ship -- whether it is an injured sailor, SAMSA for pollution damage or a hotel that has lost business -- can go to court and ask it to be arrested. This starts a claim against the ship, but also prevents the ship from leaving until the claim is settled or the claim is guaranteed. The problem is, if one has a claim against a ship but does not do anything about it, it can leave the ports and South African waters. The Admiralty Act allows a ship to be arrested for a claim, and that includes SAMSA.  Detention takes place when SAMSA is given statutory powers to prevent a ship from sailing because of a ship defect or, in the case of the Wreck and Salvage Act, because SAMSA has a claim for cleanup costs. In the pollution legislation, SAMSA does not need the power to detain as it already has the power to arrest. Even more importantly, SAMSA cannot be given the power to detain because the Convention provided a mechanism for dealing with claims for pollution, and a specific procedure. This means, by implication, that you cannot follow another procedure, because South Africa has agreed to follow this procedure. A separate procedure cannot be created in this Bill to give SAMSA the right to detain.

Ms Ngele asked if SAMSA was given this power only in respect of pollution.

Mr Hartwell said SAMSA has power to arrest for any claims that it has. Where there are pollution cleanup costs, SAMSA has the power to arrest the ship.

Mr Hartwell explained what the Convention envisaged. Ships operated all over the world, and they could cause harm wherever they went, and the costs of cleanup of pollution are horrendous. Fortunately for South Africa, it has not had a major incident in the last fifteen years. In order to deal with this, the fund has been set up and South Africa has acceded to the Convention. The way that this works is that the fund creates certainty for ship owners, and will meet or pay a claim for pollution damage. In order to get to this point, if there is a claim for pollution damage, the ship can be arrested. If the ship cannot meet the claim or pay the damage, then there is a layer of insurance, produced by the Protecting and Indemnity (P & I) clubs that will pay the claim up to a certain level. The ship has to have proof of this insurance, and would not be allowed to trade without it. The insurer is liable for up R900 million on a large tanker. If the claim is more than this, then the fund in London will help with the claim. The current limit for this fund is R3 billion. South Africa will contribute its premiums to this fund. The tradeoff for the fund paying the claims, without proving negligence or that somebody was at fault, is that it is only up to R3 billion. That is how the structure of the arrangement works.

Mr Krumbock asked for clarity about the currencies involved and the amounts mentioned.

Mr Hartwell said that the amounts were rough conversions into rands from other currencies. The Convention and the Bills talked about a special drawing right, which was a basket of currencies worth around R15.

Mr Holloway said that the current legislation did not meet the Convention. The current maximum amount for a claim against a ship is about R210 million. The difference between R3 billion and R210 million is vast.

Mr Krombuck asked for more clarity on the powers to arrest and detain and asked if it was the same thing happening but with a different process, as arrest meant a ship could not leave, but detention meant a ship was prevented from sailing. The key difference was the process taken.

Mr Hartwell said that Mr Krumbock was correct.

Ms Ngele asked if the fund had ever been used.

Mr Holloway said that South Africa was unable to claim from the fund, as it had not incorporated the Convention into law, and did not have the right without these Bills being passed. The reason that it would have that right is because the two Money Bills, through SARS, will require those who import oil into South Africa, to pay a levy to the fund in London.  Fortunately, it had not needed it yet, as there had been no major spills recently.

Mr Suka said that he had fundamental questions about maritime risk, the owners of South African ships and the contributors to the fund, but that would be more appropriate for another meeting and he would confine himself to what had been presented. Surely at another level, SAMSA would have to present on what it wanted to achieve?

The Chairperson asked for more clarity, but in a more practical way. The Chairperson of the Portfolio Committee on Agriculture and Fisheries had requested a meeting between the two Portfolios, and had said that pollution is having an effect on fishing.  If the cost of what is happening with a ship exceeds the amount that can be claimed by SAMSA from the owner and any insurers, who would take care of the difference in cost?

Mr Mokhele said that the reality is that SAMSA would welcome an opportunity to present to the Committee on the full picture of maritime risk, as proceeding on a legislation by legislation basis would talk to only segments of the market. This legislation would apply only to the tanker market. However, the bulk of the risk to the coastland is the non-tanker market. There are many other measures that need to be put in place to provide further protection. The vessel in Knysna is broken down into two pieces, carrying 180 000 tons of coal at a cost to the economy. The amount of fuel on these vessels can push the issue of the tanker market itself into the background,   SAMSA would like to come and present the full picture of maritime risk in South Africa -- the gaps, the money, the subsidization of the market by the fiscus, and what measures can be put in place to make sure the country is protected across all shipping markets. There needed to be one network that protected the coastline. These Bills talked to the tanker market and would not cover the vessel in Richard’s Bay, even if they pass into law.

The Chairperson said that the submission by MLASA said it should also look at the overlaps in legislation. Before 1992, South Africa was excluded from the international conventions. There were international laws that South Africa needed to align its laws to, and not lag behind. She asked if this was what MLASA was saying.

Mr Hartwell said that this was correct. As SAMSA had said, there is a considerable network of legislation designed to manage the risk of shipping. The general trend in international shipping was to have legislation in place that provides for a limited fund, but with compulsory insurance. With this, if there is an incident, something can be recovered. These Bills deal solely with pollution from tankers.  MLASA felt it was a ‘no brainer’ to push through these laws. Twenty years ago, a large tanker broke in half off Saldanha Bay. Fortunately, half of it sank immediately and the other half burned out. If it happened today, and the oil ended up on land, South Africa would need that R3 billion to pay for the costs. Without these Bills, the taxpayer would fund the cleanup, which is undesirable. In terms of the vessels in Knysna and Richard’s Bay, there is a Bunker Convention and the Nairobi Convention, and MLASA and the Department has set up a special committee which is going through all of this legislation to recommend which conventions should be recommended to the Committee. The Phoenix, which had stranded at Ballito in 2011, had no insurance and cost R40 million to tow off the beach and sink, which the taxpayer paid.

Mr Suka asked about the twelve-mile jurisdiction issue and the two diversion issues between SAMSA and MLASA. It was his understanding that the two would come together to create a proposal where they would converge on these issues.

The Chairperson noted how important it was for both MLASA and SAMSA to had attended, and thanked MLASA for its submission. The Committee would not have had the opportunity to engage in the manner that it did, if only the Department had been here. However, this year was declared a maritime year by the Minister of Transport and she questioned the relevance of this, in terms of how far behind South Africa was with international laws and conventions. It raised the question about the performance of the branch in the Department.  If the country was this exposed, the Department should have already identified key areas to be prioritized and focused on, in this maritime year, so as not to be exposed.

Mr Hartwell said that, generally speaking, in all legislation, high courts have jurisdiction for only up to twelve miles and this was reflected in a number of positions, including the Maritime Zones Act and the Admiralty Act. The Convention creates a situation where signatory parties, which would include South Africa, have jurisdiction to deal with any pollution claims up to 200 miles off the coast. The problem that this created, and that the Bill tried to deal with, is how the court deals with the Knysna ship. If the Knysna ship was a tanker which was 70 miles off the coast and causing pollution, South African courts would not normally be able to deal with it. With the Bills, the High Court has a greater jurisdiction. Section 8 then offered two scenarios. If there was a claim before a South African court for pollution damage, the ship owner could go to that court and say that it was the owner of the ship and could limit its liability to around R900 million, of which claims could be drawn from.  This is the mechanism of the fund, and how it works. The second scenario said that if no claim has been made, the ship owner can go to any division of the High Court that otherwise has jurisdiction. The challenge is that this is a hollow provision, but could be fixed before the next meeting tomorrow.

Mr Mokhele said that the matter will be dealt with between today and tomorrow. There have been about 35 significant incidents in South African waters from 2009 to date. There is an interlink, even if the primary area of an incident is within twelve nautical miles. There is a need to manage the coastland and waters that are exclusive to our economy, whether it is within twelve nautical miles or 200. There are changes that have taken place in the structure of the courts, and the solution needs to take account of these changes that have been brought in by the Department of Justice. The last issue is the management of the marine islands that South Africa owns, and the legislation needed to be applied to these, which previously fell under the Western Cape Court. At some point, the relevant parties should have a discussion on all the things that need to happen to fast track amendments about maritime legislation, and formulate an action plan. The Department had already set out a structure to reform key legislation, but it still needs to be aligned with the mechanisms in the parliamentary system. When the action plan is finished, it could find ways to reform the legislation.  

The Chairperson raised the issue of the Money Bill.  Adv Masomboka had insisted that there had been discussion between the Department and Treasury to enact the complementing Bills simultaneously. It was a short parliament year because of the elections and the Chairperson had had no discussion with the Chairperson of the Portfolio Committee on Finance relating to processing these Bills and prioritizing the Bills. In a meeting with all the Chairpersons and some Ministers, this information was not included in the list of prioritised Bills. She asked the Department, to its knowledge, how far Treasury was with the processing of the Money Bill.

Adv Masombuka said he would check with Treasury, but could guarantee that the Department had been working with Treasury to get the Bills approved.

The Chairperson said that the Chairpersons of each Committee needed to know about the Bills, because it was important to schedule and programme their work, and not only the Departments.

Mr Mokhele said that as early as May last year, SAMSA was under the assumption that the Money Bill was being fast tracked. One previous issue concerned the agency to collect money, but this had been ironed out and completed. The drafting would have been completed, but may not have been introduced at a parliamentary level. Therefore there should not be a very long process of drafting from its side, as the work had already been done.

Mr Johannes Makgatho, Department Deputy Director: Legal Services, said that on 25 October 2012, Treasury had informed the Department that the Bill had been certified and submitted for approval by the Minister and Cabinet. With regard to Treasury, it had not published the Bills for comment, because when the Department had started engaging with Treasury, the Department was quite ahead with its processes. The Treasury then opted to publish its Bills for comment using the parliamentary process. In that case, it had proposed that the submission should go ahead while the Departments were proceeding and were still working with the economic cluster.  He knew for a fact that, by now, the Treasury’s Bills should have been in Parliament.

The Chairperson said that she would check with the Chairperson of Finance about where the process was.  It was very important for the implementation of this Bill.  The Committee Secretary has not received any information from the Portfolio Committee of Finance. There needed to be more coordination from the Department with both Committees and other departments, to prioritise the complementary Bills and to ensure they could be implemented simultaneously. If the Department had failed to coordinate properly, it could not blame Treasury for not tabling that Bill. The Department and the Committee should have used all the tools and instruments at their disposal to ensure that they arrived at the finishing point simultaneously with Treasury.

Mr Makgatho asked if he could read a letter to the Committee from the legal services representative in theTreasury.

Mr Suka said that it was unfair to speak about other parties, such as Treasury, that were not represented at the meeting, and suggested that a consultation process should be done and the Department should improve its coordination. He asked if the Committee could return to its original mandate.

Adv Masombuka said that the point had been noted.  There would be improved coordination in future, particularly with Treasury.

Mr Mokhele said that regarding the issue of jurisdiction, there needed to be coordination with the Justice Department too.

The Chairperson asked if there were any further questions relating to the submissions.

Mr Ollis said that the Committee was covered and that further questions could wait until the relevant parties had met with the lawyers who were meeting later in the day to tidy up any issues. Any further questions would waste their time, as they would probably answer the questions tomorrow.

The Chairperson asked the Committee to exhaust its questions, so that the lawyers could engage on everything that had been raised, as the Committee needed to use all the time it had.

The Chairperson said that before getting the legal opinion of the Parliamentary Legal Advisor (PLA), there was an opinion from the Cape Bar Council. There was an issue of it being submitted after the closing date and the Committee would want to be guided by the PLA on how to deal with this.

Mr Michael Prince, Parliamentary Legal Advisor, said that he had had a look at the opinion this morning, as he was on leave yesterday. Most of the issues raised were matters that had been previously raised by MLASA and in the subsequent discussions here. The Bar Council had made a number of proposed solutions which had been raised to move points of clarity forward.  The Committee could make a decision on whether this would add more value to the Bill, and whether it should be included or not. No new issues had been raised, but possible solutions had been provided.

The Chairperson asked what the PLA was advising the Committee to do.

Mr Prince said that he was advising the Committee to consider the opinion if it felt it was needed. He advised the Committee to look at the solutions.

Mr Suka said that the PLA was possibly still trying to find his feet.   He would have thought that the PLA would have gone straight to the areas where he felt that there was a need for the Committee to consider, based on his advice. There was no real assistance from the PLA, and he should read the content and tell the Committee if he was satisfied with it.

The Chairperson described the PLA’s job title, and said that the Committee was seeking advice from him. There were two issues. Firstly, what should the Committee do with the opinion, because it had arrived late, after the deadline, and what was the legal advice in this situation?  Secondly, there should be clear advice on t the issues that had been raised and how they had been covered.

Mr Krumbock said that he agreed with Mr Suka.   He had looked at the submission from the Cape Bar Council, which was highly technical -- it assumed a level of knowledge which the Committeen might not necessarily have. The PLA should not ask the Committee to deliberate on it.   He needed to bring his expertise to the Committee, and alert it to the issues that required attention.

Mr Prince said that there was a closing date for submissions that everybody was aware of, and the Bill had been advertised. There had not been a request for an extension from the Cape Bar Council. It was technically a matter of procedure, and technically the submission should not have come before the Committee. However, the Cape Bar Council had raised very technical issues, most of which were in line with what the MLA had raised and what had been discussed today. He was not a maritime expert and there would maritime experts present who would be better at engaging with it. The issues raised in the opinion should be engaged with by SAMSA and MLASA , to incorporate proposed solutions.

The Chairperson asked if Parliament had provided the Committee with a PLA on maritime issues, who was not a maritime expert.

Mr Prince said that he was a legislation drafter by trade, which meant that he would have to look at issues in terms of the nature of the legislation. Parliament would be hard pressed to find a PLA who was a maritime expert. PLAs consider the law, speak to the other parties involved and try to come to some sort of agreement and seek advice from experts also, to try and put forward legislation for the Committee.

Mr Suka requested that there be a meeting between the Department, MLASA and the law advisors to look at the Bar Council’s opinion and discuss the issues before tomorrow, so that they could bring forward a joint opinion.

Mr Ollis suggested that, while the document had arrived late, it was still possible to send it to the drafters for consideration if it made an important contribution.   A copy should be sent to the Department, MLASA and the State Law Advisors for their meeting. The substance of the proposals seemed to be around the same issues that had been raised. If the parties met this afternoon, they could come to an agreement. This would be a quick solution that would benefit all parties, rather than dismissing the Cape Bar’s submission, and the input would be valued by the drafters.

Ms Ngele said that she disagreed with this proposal, as it would encourage other late documents or presentations to be submitted.

Mr Holloway said that the two Cape Bar Council members who had drafted the document were both MLASA members and Admiralty advocates, and had worked for free to draft the document over the weekend after they had been given three days. This needed to be taken into account and not dismissed. It would be really irresponsible to discard people of that caliber.   There were very few people in the country who could grasp the complexity of this issue, and these were some of the top experts in the country. They had raised concerns that had been an issue for 16 years, and he had personally been working with them for nine years, but the parties had only three days to respond and this needed to be taken into account.

The Chairperson said that the procedure allowed a specific time for people to make submissions. There was no one who had been given short time. The point made by Ms Ngele is that a precedent should not be set. The calibre of the people who had written the documents and the time they had taken without being paid, was not the issue. The issue is that the submission came after the closing date and the Committee was debating whether to consider the submission or not. Two members felt that it should be considered and one felt that it should not. Submissions are received from any persons in South Africa who want their voice to be heard, regardless of their calibre. It was a public hearing and a democratic process. The argument was about the rules of parliament, not any other issue.

Mr Krumbock did not want the Committee to make this issue an intense dispute. The Chairperson had previously appealed to the Committee to put the country first when making decisions and respectfully suggested that the document be accepted.   He acknowledged that a precedent could be set, but understood that the document was in the interest of the country to try and fix a problem that had been around for 16 years. The Committee should apply its considered discretion, with the wider interest of the country in mind, and accept the document.

Mr M Duma (ANC) said that the Committee had asked SAMSA and MLASA to work together and come back to the Committee, and the late document should be presented to them at their meeting.

Mr Mbhele said that he was excited when there was an agreement between the ANC and the DA. It was commendable and noble that MLASA worked so closely with the Department. However, the proposal was unusual because it came late, and because the two experts who drafted it were MLASA members. Usually, there is only one submission from one organization. He agreed with Mr Suka and Mr Ollis about allowing the Department, SAMSA and MLASA to look into the submission and consider any relevant issues. It was not correct for the submission to have been late, but the provision should still be granted.

Ms Ngele said that she agreed with other Members’ proposals and insisted that she had the interests of her country at heart.

The Chairperson said that it was necessary to discuss this issue as it was important for the Committee to accept all submissions, and not close out peoples’ views. The submission could have been ignored, as it came after the deadline and not even brought to the meeting.  She corrected MLASA, and said that no one had been given three days to make a submission. The Committee had followed procedures and should not be blamed if MLASA or anyone else saw the advert three days before the submission cutoff date. It was important that the Committee be accorded the same respect that would have been expected of it, to give to other people.  

The Chairperson said that the final ruling was that the proposal from Mr Suka, and backed up by Mr Ollis, would be taken. However, the Committee would inform the Cape Bar Council that, in future, late submissions wouldl not be accepted and they would not be treated differently. The submission was not being accepted because of who they were, but because the Committee wanted to hear all the views. It was not setting a precedent. The Committee was giving the legal parties an opportunity to meet and discuss the issues and come back tomorrow.

Mr Mokhele said that one question remain unanswered.  This was about the situation where a ship’s damage went beyond the fund amount’s threshold. The task for the parties should be extended to come back tomorrow with a view on a supplementary fund of the third tier, when an incident is beyond the threshold. There was also a current issue of maritime not having an emergency fund, while aviation did have.

The Deputy Minister said the Department had homework to do, to give the Committee precise answers on where the process regarding the Money Bill was and if it was making progress. She supported the decision to take into account the Cape Bar Council’s submission and agreed with the letter to them about the submission date.

Ms Hamida Fakira, Deputy Director General: Maritime Transit of the Department of Transport, said that there was constant communication with Treasury in relation to the Money Bill, and the Department would arrange further meetings with it to move forward.

Closing Remarks
The Chairperson said that all responses relating to the Money Bill would be heard tomorrow.

The meeting was adjourned. 


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