The Committee was briefed by the Department of Human Settlements (DHS) on the submissions made during the public hearings in Parliament and in the provinces during September on the Property Practitioners Bill.
The Department’s legal adviser provided details of the submissions from a wide range of stakeholders in the property, financial and legal sectors. Key issues raised included:
- The Mortgage Origination Council of South Africa was concerned with definition of “property practitioner” in the Act, as they were regulated by the Financial Sector Regulation Act, No. 9 of 2017 (“FSRA”).
- There was no definition of accounting records.
- The Council for Debt Collectors (CDC) submitted that they were already regulated under the Debt Collectors Act.
- The SA Institute of Chartered Accountants (SAICA) made it clear that there was a difference between a business transaction and a business undertaking in the accounting sense.
- The Banking Association of South Africa (BASA) submitted that the Bill referred to estate agents, whereas its purpose was to regulate property practitioners and not only estate agents.
- The way Clause 46 on Fidelity Fund Certificates (FFCs) was currently constituted in the Bill required every property practitioner to apply annually for a FFC and pay the prescribed annual fee, which was problematic.
- Various organizations stressed that there had to be a focus on transformation to ensure the previously disadvantaged were catered for.
- The South African Property Owners Association (SAPOA) insisted that the Board should include representatives of the various regulated sub-sectors of the property industry.
Academics in the Eastern Cape made very comprehensive submissions on transformation, stating that there must be explicit information regarding the transformation imperative of the Bill. There should be checks and balances on the sector performance, in particular on the transformation imperatives which required a re-think on the monitoring and evaluation capabilities. Property sector transformation priorities that would inform research in the first ten years of the promulgation of the Property Practitioners Act should include barriers to entry and meaningful participation in the property sector by previously disadvantaged individuals; the demographic distribution of skills that determined resilience in the property sector; and inclusive, accessible and transformatory curriculum development and enhancement in the technical and vocational education and training (TVET) and higher education sectors in South Africa.
Members welcomed the comprehensive input from the DHS on the Bill, and stressed the need to incorporate all the amendments in the Bill before it went to the National Council of Provinces (NCOP) for further consideration. They would undertake the clause-by-clause deliberation of the Bill the following Tuesday.
The Chairperson said the agenda was to deal with the Property Practitioners Bill, which had been introduced on 15 June. Following that meeting, there had been a meeting in Parliament on 14 September. After submissions had been made by some organisations, comments and recommendations had been received in oral presentations in the provinces from 17 to 28 September. The Committee was now at the stage where the Department of Human Settlements (DHS) would respond to inputs received during the stakeholder engagements.
Property Practitioners Bill: Comments and responses
Mr Neville Chainee, Deputy Director General (DDG): Strategy and Planning, DHS, said the Department had submitted a document to the Committee which detailed the proposals as well as the Department’s response to the inputs made. There had also been engagement with the state law advisors who were helping with the redraft.
Mr Khwezi Ngwenya, Legal Adviser, DHS, took the Committee through the public comments and the Department’s responses. He said the first part would focus on the entities specific submissions on clauses of the Bill and the Department’s response, while the second part would reflect comments taken from provinces from 4 September.
The first organisation that made presentations on 4 September was the Mortgage Origination Council of South Africa (MORCSA). Their first concern was on the definition of “property practitioner” in the Act. They indicated in their submission that they were regulated by the Financial Sector Regulation Act (FSRA), No. 9 of 2017, and as such they should not be regulated under the Bill to prevent double regulation and double compliance.
The first instance from the DHS’s point of view was that the rationale for extending the definition to cover and regulate the financial sector was to cover each and every role player in the sector in order to advance consumer protection in general. The Department would consult with the financial sector regulated under the FSRA to ensure that the same interests and obligations were also covered in that legislation, as and when the FSRA was amended. Therefore the Department would consider excluding the financial sector from this provision for the reasons as set out above. The other issue they raised was in relation to clause 57(1), where they stated that it must be rephrased to read “encouraged for reward.” The Department concurs with the proposed amendment and the provision would be revised accordingly.
The second organisation was the Independent Regulatory Board of Auditors (IRBA), which also had a concern on clause 1 on definitions. Its submission was related to how it would affect the way the industry was regulated and which issues were related to their particular organisation. They submitted that there was no definition of accounting records. They went further to propose a new insertion under the definition, to add accounting records to mean information in written or electronic form concerning the property practitioner’s trust accounts as required in terms of this Act, including but not limited to records of all transactions involving trust monies, general and subsidiary ledgers and other documents and books used in the administration of the trust accounts, and, in relation to the property practitioner’s business as such, information in written or electronic form concerning the financial affairs of the business as required in terms of this Act, as well as in terms of any other Act that may be applicable to the form of entity.
The DHS concurred with the proposed amendment, as it was according to international accounting standards and the provision would be revised accordingly by way of insertion in the definition.
The other section they were proposing was Clause 53(1), (a) – (b) and 53(5). Clause 53 (1), (a)-(b) stipulates that “Every property practitioner- (a) must open and keep one or more separate trust accounts, which must contain a reference to this section, with a bank registered in terms of the Banks Act, 1990 (Act No. 94 of 1990); (b) must immediately after opening a trust account contemplated in paragraph (a) appoint an auditor as prescribed.” IRBA indicated that compliance engagement would report on material matters and further submitted that the Bill should differentiate what was expected or required in terms of the above mentioned sections. However, it should not be in detail, but be merely mentioned.
Taking into consideration the high audit fees and, as raised consistently during the public hearings and the recent Estate Agency Affairs Board (EAAB) research on illegal trading, the Department was persuaded to take this into account and proposes that one needed to have only a full audit for firms with a turnover of over R2.5 million, and independent review for firms with a turnover of less than R2.5 million. The Department would develop specific regulations in order to give effect to this specific section.
The last submission they raised was Clause 54(4)(a), where they submitted that a clear mechanism of determining the meaning of “state of affairs” as stipulated under the Clause, was needed. The Department concurs with the proposed amendment and the provision would be revised accordingly by way of insertion in the definition.
The other submissions were from the Council for Debt Collectors (CDC), who were with the DHS in six provinces. Their submission was that they were already regulated and that there was a clear mechanism that regulated them under the Department of Justice (DoJ) through the Debt Collectors Act. They submitted that that Act stood to be repealed by the Bill, and that there were issues that needed to be considered so as to be included, but it would nevertheless become overregulated.
The Department had considered all the issues raised, which were primarily on consumer protection. The Department would reconsider the provision of this section and revise it accordingly to be aligned with the Debt Collectors Act, in order to advance consumer protection in general. It would revise the definition dealing with managing agents accordingly, and managing agents would be incorporated in the definition, as raised consistently during the public hearings.
The other organisation was the South African Institute of Chartered Accountants (SAICA), which was raising the same issues as the IRBA because when one considered them, one had to look at the common consensus that accountants and auditors were raising the same issues in terms of the definitions of trust accounts and accounting records. They also raised the issue of managing agents, as they were not regulated elsewhere. The Department had taken this into consideration, and this would be reflected in our new revision.
The other issue we took into account -- which we found to be very progressive -- was the definition of business undertaking. SAICA made it clear that there was a difference between business transaction and business undertaking in the accounting sense. The provision would be revised accordingly by way of insertion in the definition as proposed by IRBA, as they were materially the same.
SAICA also had an issue with Clause 53(1), where they submitted that trust accounting was not always clear and that requirements for the trust account should be set out. These sections do not contain a requirement relating to the interest received on money in trust or invested in a separate savings or other interest-bearing account. The other issue was on Clause 53 (5), where they submitted that it should outline or describe in detail in the regulations, how such accounts should be kept. They further submitted that refinements relating to trust accounts should be made. The most important one was the proposal of a new insertion under Clause 53, in which they want the prescribed portion of interest on moneys deposited in a trust account to be dealt with, as the way it was described created some sort of competition, and the DHS had empowered the Minister to prescribe a certain mechanism as to how to deal with interest accrued in respect of a trust account.
The Department had looked at the proposal and agreed in principle that it needed this section, and as such, the same would be inserted accordingly.
SAICA went on and on about the issues that they had raised, and all of them had been taken under consideration. This was because they were not just criticizing, but also providing solutions in line with international best practice. The last was on Clause 76 in respect of transition. The Department had considered it and the new section would be inserted accordingly.
The other organization that made submissions was the Banking Association of South Africa (BASA). BASA raised the same issues as well, which were of interest to the financial sector. They also submitted that “business undertaking” should be defined.
On Clause 3, BASA was of the view that there was a pressing need for the tenants to also be included within the scope of training, which DHS envisaged fulfilling. They further submitted that care should however be taken by the DHS not to duplicate the role of the Office of the Community Schemes Ombud Service (CSOS) in this Bill,, as one of the roles which this office envisages is the provision of training for both body corporate trustees and sectional title owners. BASA therefore proposed that the Bill should be amplified to include the need for tenant education and to exclude any training which the CSOS intends undertaking in terms of CSOS Act. This was in line with the agenda for transformation. The provisions would be revised accordingly.
The other issue was on Clause 6, which relates to the functions of the Authority. BASA submits that the Bill refers to estate agents in clause (a), (b) and (e), but that this was inconsistent with the Bill as the purpose of the Bill was to regulate property practitioners, and not only estate agents. This had been a common issue that had been raised during the public engagements.
The other was on Clause 23, “Lodging of Complaints to the Ombuds.” BASA submitted that the scope of the Ombud’s office should be extended to include hearing industry complaints against the Property Practitioners’ Board, especially where matters were not being resolved that were affecting the ability of a practitioner to continue operating and, in extension, the livelihood of the practitioners in that affected agency. The Ombud’s chapter would be omitted in lieu of the establishment the Human Settlements Ombud in the Human Settlements Bill.
The other Clause was 46, in respect of Fidelity Fund Certificates (FFC). The submission was that the way it was currently constituted in the Bill, it required that every property practitioner had to apply annually for an FFC and pay the prescribed annual fee. The possession of an FFC was a mandatory requirement for a property practitioner. The other thing the Department heard in the provinces was that the certificate had been paid for, but had not been issued. What the DHS proposed was that if one could prove that one had paid, one would be deemed to have fully complied even without having the actual physical certificate.
BASA also raised an issue with Clause 49, on disqualification of the FFC. It proposed a long list of mandatory reasons for the Property Practitioners Regulation Authority (PPRA) to withhold an FFC, and thereby affect the ability for them to earn an income. BASA submitted that there should be a legitimate and justifiable ground for withholding an FFC which was based on the principle of fairness and natural justice. The Department concurred, and the provision would be revised accordingly.
As with both the accountants and auditors, BASA raised issues regarding Clause 53 on trust accounts. The biggest concern, though, was on Clause 54, where trust accounts were viewed basically as a barrier to market entry, because people would not be able to afford to start up and still comply by paying for their bank statements.
There was also a submission on Clause 67(1) on the language of the agreements, the same as the auditors. BASA proposed that this provision be aligned to the provisions of the National Credit Act which deals with language statement of intent, and which dictates that the official version be provided in English and copies be made available in the language of choice, upon request.
BASA also raised an issue on transformation of the sector. It submitted that they were supportive of transformation within the property sector, including intermediaries. However, the wording within clauses 69(3) and 69(4) went beyond the intent of the Bill, which was to regulate and transform the property intermediary sector. They further submitted that the Bill envisaged transformation, and the creation of a transformation fund should therefore be restricted to expenditure used to transform property practitioners operating within the sector, including the up-skilling of potential homeowners and property practitioners. Therefore the purpose of the transformation fund should be to provide opportunities for historically disadvantaged individuals, including women and youths, to become property practitioners and thereafter to be able to compete with their established competitors only. The communities had stated that there was need for this issue of transformation to be specifically outlined. The Department concurred, and as the matter had been consistently raised during the public hearings, a new chapter on transformation would be drafted and clause 69 would be substituted accordingly. Their comments had been very fair and supportive of the agendas the DHS was raising.
The submissions of the Centre for Affordable Housing Finance (CAHF) were centered on transformation to ensure the previously disadvantaged were catered for, and which was what the DHS had been dealing with. The other issue was on Clause 46 on the FCC certificates and the issue of the trust account as well. Also on clause 4(5) on exemption, the CAHF submitted that the Bill did not actually state under what circumstances or grounds a property practitioner could apply for an exemption. They therefore proposed that grounds for exemption could be provided for in the regulations. The regulations could identify the category of small enterprises focused on the historically disadvantaged townships’ markets -- those small enterprises which were financially unable to contribute to the Fund and, due to their function in the property value chain, did not need to open a trust account. The Department concurred with the proposal and therefore it would be dealt by way of the new insertion under the regulations.
The Black Property Practitioners Association (BPPA) was very vocal regarding transformation, stating that there was need to spell it out and make it clear and that there was need to compel the state to play a role in assisting the previously disadvantaged for them to gain access to the market. This was because if one could not get access to stock, how could one say that one would begin to comply? The Department concurred, and as it was consistently raised during the public hearings, a new chapter on transformation would be drafted and Clause 69 would be substituted accordingly.
Adams and Adams had come into the spotlight as representing the Services Sector Education and Training Authority (SETA). However, their presentations were very fair. Their issue was simply that Clause 3 of the Bill on training sought to provide services that were provided by the Services SETA, and this was in direct conflict with its right to provide qualifications. They wanted to protect their space in respect of training. The DHS recognised that one of the objectives of the Services SETA was to develop qualifications, but the Authority would be expected to provide training and development such as continuing professional development (CPD) over and above the qualifications as developed by the Services SETA. In this regard, a strategic partnership and collaboration would be consolidated between the two entities regarding the application of this Act in relation to training.
The Real Estate Business Owners of SA (REBOSA) submitted that clause 2 on definitions was too wide and created many ambiguities and uncertainties. The rationale to make the definition too wide was to advance consumer protection in general and to regulate the entire property market. The other submission was on Clause 46 on the FFCs, and it was their submission that it should not be renewed annually. The Department concurred with the comment, and the provision would be reconsidered in order to reduce the burden of renewing FFCs annually and provide that it would be now be renewable every three years, as proposed by the SA Property Owners’ Association (SAPOA).
REBOSA further submitted that the requirement of a Black Economic Empowerment (BEE) certificate, especially for small businesses, was costly and a barrier to entry, and the Department concurred. They further submitted on Clause 53 on trust accounts, that opening them should be optional. The Department noted the comments; however, the Minister would prescribe exemptions in terms of keeping trust accounts.
Another organisation that made submissions was the National Property Forum (NPF), which represents the majority of the black estate agents and the marginalised. The issues they raised were raised by others, and had been considered -- for example, on Clause 53 trust accounts. The NPF further submitted that 99% of the estate agents did not use trust accounts, and therefore proposed that it should not be mandatory for businesses that had an annual turnover of less R1.5 million to open a trust account. The Department noted the comments. However, the Minister would prescribe exemptions in terms of keeping trust accounts.
Clause 54 was also raised. The NPF submitted that keeping the accounting records was not necessary, and should be optional because of cost involved. The Department had noted the comment, and therefore the responsibility for keeping accounting records would be reduced from 10 years to five years. They also raised an issue on Clause 69 on transformation, and this had been addressed.
The South African Property Owners Association (SAPOA) stated that they had felt ignored in the process of deliberations on the Bill. However, the DHS had had a very fruitful discussion with them. Their concerns were directed at Sections, 14, 16 and 56 of the Consumer Protection Act (CPA). They submitted that the EAAB should apply for an exemption from these sections. They acknowledged that it would be important for those who were actively involved in the day to day running of a property practitioner business to be registered as a property practitioner, but were of the opinion that a blanket registration requirement was too restrictive because it did not allow the industry to draw on the skills and expertise of other areas, such as law, banking, construction or environmental science. The Department concurred with the proposal and would ensure that the cross-referencing in relation to exemption as provided for in the CPA was aligned accordingly.
On the composition of the Board in Chapter 2, SAPOA submitted that it was critically important that it should be representative of the various regulated sub-sectors of the property industry. The Department concurred and, as raised during the public hearings, the Portfolio Committee should review not only the composition but the overall alignment of this provision with the National Credit Regulator (NCR). They also raised other issues which had been discussed and taken into consideration, as the same proposals were made by other organisations.
There were also submissions from the South African Council for the Property Valuers Profession (SACPVP) on Clause 1 definitions. They submitted that they were already regulated under the Property Valuers Profession Act, 2000 and as such, the word “assessment” should be defined or be excluded from property valuers, as there might be unintended consequences. They proposed that a sub-clause be inserted under exclusions in the definition, which would read as follows: “excluding a person regulated under the Property Valuers Act, 2000”. The Department concurred, and the provision would be revised accordingly, in line with the comment from the Council to exclude professional valuers from the definition and application of the legislation.
After 4 September, the first province the DHS went to was the Eastern Cape. Some of the organisations followed them there, and in East London there had been important submissions from academics. Two professors from Nelson Mandela University and Fort Hare made some very comprehensive submissions. The points they raised were that first, in the preamble and the long title, there must be explicit information regarding the transformation imperative of the Bill. They further submitted that there should be checks and balances on the sector performance, in particular on the transformation imperatives, which required a re-think on the monitoring and evaluation capabilities. Their submissions were very strong.
On Clause 7, on composition of the board, they submitted that amongst the skills and competences required for an effective and efficient functioning of the Board of Authority, advanced property sector policy analysis and research expertise should be added. The Department of Trade and Industry (DTI) had done a comprehensive study regarding rationalisation of the public entities, which mainly dealt with regulating various sectors, and they were prepared to share the rationalisation process with the Committee, in particular the NCR legislation amendment.
On Clause 69, they submitted that an independent mechanism in the form of a South African Research Chair for property sector transformation must be created in partnership with the National Research Foundation (NRF). Their submissions were very clear in what they wanted. They also submitted that the property sector transformation priorities that would inform research in the first ten years of the promulgation of the Property Practitioners Act should include:
- Barriers to entry and meaningful participation in the property sector by previously disadvantaged individuals;
- Demographic distribution of skills that determine resilience in the property sector;
- Inclusive, accessible and transformatory curriculum development and enhancement in the technical and vocational education and training (TVET) and higher education sectors in South Africa;
- Systematic patterns of discriminatory behaviour in the property development and management value-chain;
- Efficacy of compliance, monitoring and enforcement mechanisms to advance the transformation of the property sector;
- The rural-urban dynamic in property sector growth and transformation; and
- The contribution of the property sector in urban spatial transformation and economy.
The University of Fort Hare also raised the same issues on transformation, saying that it was too general. They submitted that transformation was very minimal in the Bill and therefore proposed that there should be a stand-alone chapter that dealt with transformation in detail, setting out milestones, timeframes and clear targets etc.
Xoliswa Tini Properties who submitted on the transformative agenda of the Bill, saying that it was not clear in the Bill as to how transformation should take shape. They argued that qualifications such continuing professional development complicated the sector, and the sector required soft skills like marketing and negotiating skills, which were not encompassed in the Bill. Developers should not be regarded as property practitioners, irrespective of whether they sold their own properties. The main issue was the unavailability stock to sell. They also spoke strongly about barriers to entry.
Bam Tshangana Properties, representing the NPF, also raised the same issues. They submitted prior to 2008 it had been easy to get the qualification, and that the old method of qualifying should be brought back as the new one was encouraging illegal estate agents to mushroom. There should also be a programme for those who had qualified as principals before, to be brought back. They submitted that the involvement of the Services SETA needed a lot of attention. The Department recognized that one of the objectives of the Services SETA was to develop qualifications, but the Authority would be expected to provide training and development such as CPD over and above the qualifications as developed by the Services SETA. In this regard, a strategic partnership and collaboration would be consolidated between the two entities regarding the application of this Act in relation to training.
Lastly, on clause 55, they said it was not fair because the transfer of a property might be delayed as a result either of the seller of purchaser breaching the contract, while the estate agent would have performed his or her part of the process.
When the DHS went on to KwaZulu-Natal (KZN), SAPOA had also been there and put forward the same submissions as in Parliament.
The other submission had been from Nondu Mthwa, Chief Executive Officer (CEO): Idwala Property Group, who had expressed very strongly that the opening and maintenance of trust and business accounts, and the renewal fees, was costly. This had been raised by everyone, including BASA and also generally by the sector. She submitted that the government should give its stock to the estate agents, and asserted that the banks were denying black-owned businesses distressed properties.
The South African Council for the Property Valuers Profession (SACPVP) submitted that the costs to enter in this kind of business were high, including those of trust account and renewal fees, and where Clause 49 would be substituted as discussed. He also raised the issue of franchising, saying that if the Bill made the franchisor responsible for the actions of the franchisee, it would disincentivise a person who wanted bring transformation into this area of enterprise.
Just Properties also submitted the same view on franchising and franchisors who did fronting under Clause 64.
Nxumalo Attorneys said that that the word “conveyance” should be clearly articulated in the Bill.
It was also proposed that managing agents should be included under the definition of property practitioner. As raised consistently during the public hearings, the managing agents would be reincorporated in the definition.
The Small Business Institute (SBI) proposed that there should be a once-off six months’ assistance for new entrants. It was a similar proposal to others who submitted on stock.
Individual submissions were made that the sector was overly regulated, that it was extremely difficult for new entrants, and that the Board must look at the interests of the property practitioners, especially in regard to advertising on billboards.
The University of Johannesburg’s (UJ’s) presentation stated that the word “entity” was not defined. The word “MEC” was also not defined, and there might be a need set up a regional office where the MEC might have a role to play. It was further submitted that the definition of the property practitioner excluded attorneys and candidate attorneys. The same point had been raised by REBOSA and would be revised accordingly.
Regarding Section (8)(a) -- disqualification from membership of the Board -- UJ submitted that a person who was not a South African could not be appointed as a Board member. The main purpose of that provision was to deal with disqualification, including those who were not lawfully residing in the Republic. They also submitted on Clause 69, that that the Bill must clearly outline its transformational agenda. It was quite clear that the academics in the Eastern Cape, KZN and Gauteng, all called for a clear transformative agenda.
In Clause 7, under composition and appointment of the Board, UJ submitted that there should be a consumer representative as a member. The Department concurs, and as raised during the public hearings, the Portfolio Committee needed to review not only the composition but the overall alignment of this provision with the NCR.
Submissions from the Council for Debt Collectors (CDC), the SACPVP and NPF were the same as those previously put forward. There were general comments that the transitional provision did not take into consideration the rights of property practitioners, and that there must be clarity on the roles of CSOS and EAAB. The National Association of Managing Agents (NAMA) who raised the same issues that managing agents should be considered. The comments had been noted and the alignment with the CSOS and the Rental Housing Act would be done accordingly, as raised by BASA. The Institute of Estate Agents of South Africa (IEASA) raised the same issues on Clause 1 definitions, Clause 47 and FCC certificate, which the DHS had considered.
In Limpopo Province, the Property Valuers Association following them to ensure that their view were being considered. There was also an individual submission that the attorneys paying commission must make sure that the property practitioners with whom they were working were registered before paying them. Polokwane Municipality had referred to Clause 7 on the composition of the Board, proposing that it must have a town planner as one of its members, as it regulated the built environment.
In the Free State, the Services SETA raised the same issues that they had previously raised regarding the training in Clause 3. There was also Clause 38 (1) on grants, where they submitted that this was also a mandate which fell within the scope of the Service SETA’s area of practice.
The SACPVP were also present and talked about the same issues as before. The Black Professional Valuers (BPV) again addressed Clause 69 on the transformation agenda, and made submissions regarding the requirement to open trust accounts, the payment of fees, the CPD etc.
The Chairperson asked for clarification of two issues. There was the question of the Bill not just regulating property practitioners, but also supporting them. Would this be on its own, or would it be under the transformative chapter? The second was that the DHS kept saying the other areas would be dealt with in the regulations -- would the regulations come with the Bill, or would they come later?
Mr Ngwenya responded that the issue dealing with general support would be covered very clearly under the transformative chapter of the Bill. The Department proposed that there should be prescribed measures from time to time. On the other matter, so as to prevent over-regulation, the finer details of the other areas would be left for later in the regulations, and that was why provision has been made for the Minister to advance transformation by prescribed measures. The regulations would be dealt with once this particular process had been concluded.
Ms M Nkadimeng (ANC) commended the presentation, and stated that the majority of the submissions were in concurrence with the Department. She just wanted clarity on those that had been noted, and what would happen on those points.
Mr K Sithole (IFP) asked about the situation regarding the National Council of Provinces (NCOP), as the Bill was supposed to go to the provinces. What would that mean, because once it went, the Committee would not have any power over it? There was need to incorporate all the amendments in time for deliberation before it went to the provinces for the provincial mandate.
Mr M Bara (DA) said what had to be clarified in the revised draft was the transformation fund, and how it was going to be utilised. Also linked to that there were proposals somewhere to have exemptions to the same transformation fund. There was a need to be careful how this was deale with. Those to whom that transformation was directed should be the ones that were exempted from contributing towards the transformation fund. However, generally, there should be no exemptions on the transformation fund, because one might find that the whole objective of having the transformation fund would be defeated by having exemptions. He was looking forward to seeing the draft to see whether it had encapsulated what the Committee wanted to achieve.
Mr M Wolmarans (ANC) welcomed the way the Department had gone about capturing what had transpired in Parliament and also across the provinces. Transformation was covered by all the submissions and was therefore welcomed, so he believed the Committee’s proposals should be thorough when they came through. He asked the Department to look again into the question of thresholds with regard to exemptions. The Department had been proposing R2.5 million, and after the submissions had decreased it to R1.5 million. Two transactions of R750 000 were already above the R1.5 million mark. If one was also talking about stock, a person who would have been exempted would not be exempted. He wanted the Department to raise it to even more than R2.5 million. Recognition of prior experience should also be taken into account, because it had also been identified as a barrier in a number of submissions.
The Chairperson said that she was happy that the Department had really tried its best to address the big issues that had been raised across the board. She wanted an assurance that Members would have the D-version of the Bill by Friday if possible, so that when they came to the meeting on Tuesday they would have had time to go through it. The meeting of next week would be more intense, as they would be looking at the Bill clause by clause, so the meeting would be for the full day.
The meeting was adjourned.
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