Copyright Amendment Bill & Performer’s Protection Amendment Bill: adoption; National Gambling Amendment Bill: consideration

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Trade and Industry

15 November 2018
Chairperson: Ms J Fubbs (ANC)
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Meeting Summary

In a packed agenda, the Portfolio Committee on Trade and Industry began with the formal consideration of the Copyright Amendment Bill. Clauses 1 to 38 were approved by the Committee but with a number of objections from the DA. Objections related to the resale of royalty rights, the transmission of royalty rights and the royalty regarding artistic works. There was also an objection to the fact that the royalty was “equally shared” which was interpreted as meaning each party had to receive 50% as opposed to the view that that would be the agreement for anyone without a contract. The DA also objected to the offences and the penalties for the offences. The clauses relating to the lack of specificity in respect of providing access to people with a disability and the requirement that collecting societies had to adhere to certain transformation principles in order to be accredited was put to a vote. In both cases, the ANC carried the vote and the clauses remained in the Bill.

The Draft Report on the Copyright Amendment Bill was approved by the Committee although the DA objected to the report on the grounds that it was not a fair and accurate reflection of the process. The Bill and the Report were tabled immediately.

The Committee engaged in a clause-by-clause consideration of the Performer’s Protection Amendment Bill [B24B – 2016]. Clauses 1 to 11 were approved by the Committee with the DA objecting to Clause 3 Section 3A(3)(a): “standard and compulsory” written contracts in that the party believed that the terms should be recommended terms for consideration by the parties and not compulsory. The DA also objected to Clause 6 section 8D(3) in which the Minister had to make regulations prescribing compulsory and standard contractual terms to be included in agreements.

The Committee approved the adoption of the Report on the Performer’s Protection Amendment. There were no objections.

The previous day, the Department of Trade and Industry had been requested to make a presentation on the Departmental agency rationalisation process and to align the National Gambling Regulator to the National Credit Regulator model. The Departmental presentation of the rationalisation process showed that replacing a board with a Chief Executive Officer led to greater efficiency and that those Departmental entities headed by a CEO, Regulator or Commissioner were currently operating effectively without a board or a committee, except in the case where a board was a legislative requirement. The Department recommended that the reference to a committee to advise and support the Chief Executive Officer of the proposed National Gambling Regulator be removed from the Bill.

Once the State Law Advisor confirmed that the removal of the Committee would not affect the constitutionality of the Bill, the Portfolio Committee adopted the proposal to remove it from the legislation. The clause-by-clause reading of the National Gambling Amendment Bill would take place the following week.

Meeting report

Opening remarks
The Chairperson opened the meeting by asking everyone to try to conclude the meeting by 22:00.

The adoption of the agenda was proposed by Ms L Theko (ANC) and seconded Mr D Mahlobo (ANC).

The Chairperson acknowledged the delegation from DTI as well as Adv van der Merwe from the Constitutionality and Legal Services Office, whom the Chairperson appreciated for the application of her mind and that she went beyond the call of duty. She welcomed Adv Veounia Grootboom from the Office of the Chief State Law Advisor, and Adv Johan Strydom, Legal Advisor from DTI.

The intention was to engage in the formal consideration of the Copyright Amendment Bill. Although the Performer’s Protection Amendment Bill had come first, the Committee had decided that it was important to complete the Copyright Amendment Bill before the Performer’s Protection Amendment Bill. It was a very important Bill and she thanked Ms Theko for drawing the Committee’s attention to the fact that the Copyright Amendment Bill had to be addressed first as it impacted on the second Bill.

Mr D Macpherson (DA) indicated that he would leave at 19:00 owing to a long-standing arrangement.

The Chairperson stated that the Committee was sitting so late because he had not wanted to leave the House earlier to start the meeting. His Chief Whip had insisted that he stay in the House.

Mr Macpherson stated that the Chairperson was not entirely correct. There had been no consultation with the Chief Whip about meeting earlier in the afternoon and so the Chief Whip had been unable to entertain the notion of excusing Mr Macpherson and Mr Cachalia. He also pointed out that he had agreed to sit the following Thursday evening.

The Chairperson thanked Mr Macpherson for the explanation, saying that she respected his party discipline.

Consideration of the Copyright Amendment Bill [B13B – 2017]
The Chairperson read through the Bill.

Mr Macpherson was concerned that the Committee was speeding through and not going line by line. He asked whether the Committee should not be reading the lines and be given an opportunity to go through it point by point.

The Chairperson said that the Committee was going clause-by-clause, which was the practice, not only in that Committee, but also in other Committees.

Mr A Williams (ANC) agreed with the Chairperson that the Committee was engaged in a clause-by-clause reading. Members had spent maybe 600 hours on the details of the Bill and they were currently going clause-by-clause.

The Chairperson indicated to Mr Macpherson that he and all other Members had been asked to raise a hand if there was a query.

Clauses 1 to 10 were approved by the Committee.
Objections
: The DA objected to Clause 5 (7) and Clause 7, both of which related to the resale of royalty rights and the transmission of royalty rights and the royalty regarding artistic works. The DA objected to Clause 9 in respect of the offence and the percentage turnover.

Mr Mahlobo said that there was no point in discussing the reasons for objections.

The Chairperson stated that it was important to adhere to the rules which allowed the person making an objection to do so.

Clause 11: the Committee approved Clause 11.
Objections: Mr Macpherson stated that he had previously pointed out that Clause 11 section 9 (2)(a) indicated that the royalty was ‘equally shared’ which meant 50%. In his view, it was in conflict with freedom to contract and to associate. Parties should be allowed to determine their own share. He objected and moved that it be removed from the Act. His proposal was seconded by Mr G Cachalia (DA).

The Chairperson noted the point.

Mr Mahlobo said that, because the Chairperson had stated that Members could motivate, he wanted to insist that no impression should be created that team ANC wanted to undermine contractual agreements signed in terms of contractual law. The Bill also satisfied, in all respects, that contractual agreements entered into, were not affected by the Bill. He wanted it noted on the record because, if it was not noted, it could leave the impression that the ANC did not respect how its own laws worked. The ANC re-emphasised that the Bill gave due consideration to contractual agreements.

Mr B Radebe (ANC) seconded Mr Mahlobo, stating that the split would be equal if there was no contract. A contract could change the 50-50 split. There was no validity for removing the words “equally shared”.

The proposed amendment by the DA was to remove “Equally Shared” from Clause 11 section (9)(2)(a). Voting took place as follows:
In favour – 2 (DA)
Opposed – 6 (ANC)
The proposed amendment was defeated.

Clauses 12 to 19 were approved by the Committee with no objections.

Clause 20 was approved by the Committee.
Objections: Mr Macpherson stated that in Clause 20 section 19D, there should be a defined definition of the disability that allowed for general exceptions. As the clause read, it referred to any person with a disability. He stated that it should refer to a person with a defined disability, for example, a person who is blind should be able to access braille. To have a general provision and a general application to disability was problematic.

Mr Mahlobo stated that the ANC had a different view. The word ‘disability’ was defined in primary legislation. The Bill could not have a different definition. Secondly, Clause 20 section 19D was about an accessible format and the Bill could not include other conditions. That would be presumptuous. The Committee did not want have the capacity to define some of the disabilities. Section 19D was self-explanatory and at no point, even in the legal opinion, had that been raised as a point not concise in law, nor had it been raised as a point that was vague.

The Chairperson indicated that the matter would be put to the vote.

Mr Macpherson’s proposal to amend section 19D was seconded by Mr Cachalia.

Mr Mahlobo’s proposal to maintain section 19D unchanged was seconded by Mr Radebe.

The Committee voted on Mr Macpherson’s proposal:
In favour – 2 (DA)
Opposed – 6 (ANC)
The motion was defeated and the second proposal fell away.

Clauses 21 to 24 were approved by the Committee with no objections.

Clause 25 was approved by the Committee.
Objection
: Mr Cachalia objected as he supported the notion of one collecting society per right.

Mr Mahlobo stated that Mr Cachalia had previously objected to B-BBEE in that clause and that reference had been replaced by three elements of transformation that societies had to adhere to. He informed Mr Cachalia that freedom of association and affiliation was sacrosanct and the ANC would never limit the number of collecting societies.

Mr Macpherson stated that the DA had successfully held that collecting societies could not be held to the requirements of the B-BBEE Act, despite protests from the ANC. The DA had further said that the word ‘transformation’ was open to interpretation and that the only legislative mechanisms for transformation were found in the B-BBEE Act and unless collecting societies were required to meet that Act, there was no need to describe transformation and that it could not be an arbitrary requirement. It was on that basis that he asked for Section 22B(4)(b) be removed.

Mr Radebe said that the ANC did not agree with Mr Macpherson because transformation had not been left open-ended. It was very clear that the ownership and the representivity of the collecting societies had to reflect what was happening in the democracy of the country. Transformation did not reside only in the B-BBEE Act; it also resided it the Employment Equity Act. The word ‘transformation’ in the Bill was correct. It could not be business as usual.

Mr Mahlobo wanted it placed on record that it was not true that the B-BBEE legislation was the only transformation instrument. Even the Constitution was a transformation instrument, as were other instruments such as the Employment Equity Act, because of who the ANC was and where the people had come from. Secondly, everyone agreed during the in-principle reading that three imperative of transformation would be included in section 22B(4)(b). He wanted that on record so that there was no misunderstanding that B-BBEE legislation was the only transformation instrument.

Mr Macpherson repeated that one could not prescribe transformation requirements. It would be bad in law and open to challenge because it would be arbitrary in nature and dependent on the Minister and might even go beyond legal requirements if measured against the B-BBEE Act. He recommended that section 22B(4)(b) be deleted.

Mr Cachalia supported the proposal by Mr Macpherson

The Chairperson called on a vote on the proposal that section 22B(4)(b) be deleted
In favour – 2 (DA)
Opposed – 6 (ANC)
The motion was defeated.

Clauses 26 to 38 were approved by the Committee, with one objection.
Objections:
Mr Cachalia objected to the offence and penalty in Clause 27 section 27.

Adv van der Merwe said that the year of the Bill 2017 would only be changed to 2019 when it became an Act.

The Chairperson asked if it was not a 2016 Bill.

Adv van der Merwe explained that the Performer’s Protection Amendment Bill was dated 2016 but the Copyright Amendment Bill was a 2017 Bill.

Draft Report on the Copyright Amendment Bill
The Chairperson stated that space had been left on page 7 for the minority views. Would Mr Macpherson like to comment? If not, could he provide the staff with the minority view in writing at that point?

Mr Macpherson stated that the DA caucus needed to consider the Bill in its entirety and that had not happened. It would only happen the following week.

The Chairperson asked the DA to write down the comments.

The Secretary explained that the rules obliged the Secretary to capture where there was no consensus on specific clauses and there was an opportunity to provide a minority view, but he was not compelled to record a minority view.

Mr Mahlobo wished to move for the adoption of the report with a small amendment to paragraph 8. It clearly captured dissenting views but he asked that the Secretary added that Mr Mahlobo had joined the Sub-Committee at a later stage.

The Committee approved the adoption of the report.
Objections: the DA objected to the report. Mr Macpherson did not believe that the report was a fair and accurate reflection of the process.

The Committee Secretary stated that the Committee had adopted its report and that concluded the deliberations on the Copyright Amendment Bill.

Mr Radebe asked when the report would be tabled that evening and it would appear in the Announcements, Tablings and Committee (ATC) reports that evening.

Mr Mahlobo enquired whether it was necessary to vote on the report.

The Chairperson asked for a vote on the proposal to adopt the report.
In favour – 6 (ANC)
Opposed – 2 (DA)
The proposal to adopt the report was carried.

The Chairperson stated that according to the rules and procedures, the Copyright Amendment Bill had been adopted by the Portfolio Committee and she would send a report to the House recommending the adoption of the Bill.

The Chairperson expressed her appreciation to all Members of the Committee for the application of their minds. She especially thanked Ms Theko for chairing the Sub-Committee and thanked Members who had served on the Sub-Committee. She thanked all staff individually for all their work. They often took work home to ensure that the Committee could continue its work.

The Chairperson thanked all officials from the DTI, especially Dr Masotja, and all the Advocates involved, especially Adv Charmaine van der Merwe.

Mr Mahlobo thanked the Chairperson for her hard work and for driving everyone hard in the interest of the people. The Committee was content with the work that she had done.

The Chairperson appreciated Members who had sat in for her as Chairperson.


Clause-by-clause Consideration of the Performer’s Protection Amendment Bill [B24B – 2016]
Some years ago the Chairperson had become aware that performers were dying in poverty and without recognition. The response to that was the Performer’s Protection Amendment Bill.

The Chairperson proceeded with a clause-by-clause reading of the Bill.

Clauses 1 to 11 were approved by the Committee
Objections: The DA objected to Clause 3 Section 3A(3)(a): “standard and compulsory” written contracts. The terms should be recommended terms for consideration by the parties and not compulsory.
The DA objected to Clause 6 section 8D(3) in that the Minister had to make regulations prescribing compulsory and standard contractual terms to be included in agreements.

The Secretary stated that the objections would be captured in the Report.

The Report on the Performer’s Protection Amendment
The Chairperson stated that the objections by the DA had been included in the report. She asked for a proposal for the adoption of the report.

Mr Mahlobo requested that under the minority report, the report should say, “…however, the majority view had prevailed. He wanted it known that the majority had prevailed.

The Committee Secretary stated that he would indicate that the majority approved all clauses.

The Chairperson agreed that that would be a more objective approach.

Mr Mbuyane objected to the objections being recorded as there had not been a seconder to Mr Cachalia’s objections.

The Chairperson checked the rules and informed him that the point was simply to record a minority view, regardless of how many Members of the minority opposed the view of the majority.

Mr Mahlobo moved to adopt the report. His move was seconded by Mr Williams.

The Committee approved the adoption of the report. There were no objections.

Consideration of the National Gambling Amendment Bill [B – 2018]
The Chairperson moved on to the National gambling Amendment Act and asked the DTI to brief the Committee.

Briefing on the National Gambling Amendment Bill - DTI
Dr Evelyn Masotja, DDG: Consumer and Corporate Regulations, DTI, indicated that there were inconsistencies in the printed presentation but the one projected on the screen was the correct version. She offered apologies for the errors but explained that the officials had worked under very tight timelines.

The Chairperson noted that the DTI officials had been lodged in Kuilsrivier which was a long way from Parliament in Cape Town and she did not find it acceptable for women to be driving such a distance at night. She was making a public announcement and hoped that the DTI financial department understood that the situation was unacceptable.

The previous day, the DTI had been requested to make a presentation on the DTI agency rationalisation process and to bring back the NCR model.

The focus of rationalisation had been to identify whether entities performed their mandate according to the enabling legislation and other norms, including the Constitution and the PFMA. Where commissions had replaced boards, management of such entities had improved while also assisting DTI in its oversight function.

Entities that had a “board system” in place often had conflicts of interest that were not addressed and members of the boards were usually consultants that could take decisions to protect their own interests.
Key performance measures and indicators for assessing the entity’s performance were (sometimes) not clear and it was not entirely certain whether some of the entities achieved their stated objectives.

The National Credit Regulator (NCR) was a public entity with a CEO, a Deputy CEO and 170 staff members, that included a CFO and a Company Secretary. The debt book was R1.8 trillion. By comparison, the National Gambling Board (NGB) was a public entity with an Administrator, a Chief Strategic Advisor, Chief Financial Officer, Chief Compliance Officer, Chief Operations Officer and Chief Technology Officer in the executive management team. The NGB had a total staff complement of 33 and a total revenue of R213 million for 2018/19. The NGB did not approve licence applications. It had had a clean audit for three consecutive years after the Board had been removed.

DTI entities did not have committees as envisaged in the National Gambling Amendment Bill. DTI proposed that the committee be removed from the Bill as that would be consistent with the policy decision of the Department to rationalise entities. Mechanisms for oversight and review of the decisions of the NGB Administrator for the past four years had included the Minister, the DG of DTI, the Portfolio Committee, and the Audit and Risk Committee of the NGB.

The NGB had prepared a report on its performance, achievements and what it had done in four years without a board or a committee.

Discussion
Mr Cachalia thanked the DDG for the motivation for rationalisation but asked how governance and dispute would be addressed. He noted that a clean audit was only a reflection of disclosures and the Audit Committee had specifically defined functions.  He asked for a copy of the rationalisation report for the Committee and the House.

Mr Radebe thanked DTI for the report which was exactly what the Committee had asked for. The Committee had wanted to see exactly what had happened with the NGB. The Administrator had worked well. The Bill should use the NCR model, remove the committee and keep the NGB structures that were currently working well. During the comprehensive review of gambling the following year, the Committee could consider whether any adjustments were needed. He agreed that the committee should be removed from the Bill.

Mr Mahlobo thanked the DDG for considering the Portfolio Committee’s view. He suggested to the Chairperson that the legacy report should include the gambling issues to be considered going forward. He noted that he needed to re-read ex-President Motlanthe’s report which suggested that it was not always necessary to legislate structures because structures needed to follow function. Some of the issues were beginning to be conflated. Should the Auditor General one day audit the implementation of legislation, he would find many structures in legislation which were not always adhered to in practice.

Mr Mbuyane stated that the Whip had spoken. The Committee supported the conclusion of DTI. Once the Bill had been implemented, the Portfolio Committee would see if a committee or tribunal was needed. NGB needed to take the model of the NCR as it existed for the present and it would be reviewed.

The Chairperson asked Adv Grootboom if she would like to comment on the constitutionality of the Bill if the committee were omitted.

Adv Grootboom stated that she had listened to the deliberations the previous day and had discussed the issue with DTI. The Office of the State Law Advisor had gone over the constitutional report and the Bill. Most of the concerns had been about practical implications but it appeared that the issues had been addressed by the Department. There was no constitutional problem in removing the committee from the Bill.

Mr Radebe proposed that the Department and the Legal Advisor remove the committee from the Bill so that the Portfolio Committee could have an amended copy of the Bill for the following week.

Mr Mahlobo said that his understanding was that the Portfolio Committee should do a clause-by-clause reading the following week but, in the meantime, the technical team should remove all references to the committee from the Bill. The staff should then liaise with Creda to get a copy of the Bill ready for the next meeting. The document should be circulated before the meeting, even if only one hour before the meeting, so that Members could check that the deletion had been made.

The Chairperson asked the Secretary when the Bill could be ready.

The Secretary replied that it depended on when he received the Bill from the Department but he foresaw that he could distribute it to Members late on the Monday of the coming week.

The Chairperson asked for further comments.

Mr Cachalia reiterated that, in the light of the extreme urgency to complete the Bill, the Committee had to receive the DTI Entity Rationalisation Review as soon as possible because it was presumably available.

Dr Masotja agreed to circulate the Review the following day.

The Chairperson requested the circulation of the Review on Monday.

Mr Cachalia asked for it to be circulated the following day.

Mr Mahlobo stated that if the document was available, it could be circulated before 10:00 the following day. Things had improved but documents were often circulated late and that was not okay.

The Chairperson requested Dr Masotja to send the document to the Secretary the following day.

The Chairperson asked Members if the Committee was going to do an in-principle agreement that evening.

Dr Masotja noted that Members had received a copy of the Bill.

Mr Mahlobo stated that the in-principle approval of the Gambling Bill had taken place at the previous meeting. It was just the committee that Members had wanted removed.

The Chairperson stated that the Committee had now taken a position that the clause on the Committee had to be omitted.

Dr Masotja said that the Committee had gone through only the major areas but she accepted that the Bill could go ahead to the clause-by-clause stage.

Mr Mahlobo stated that the Committee, in fact all parties, had agreed in principle, even on the deletion of the committee. On Tuesday the Committee would be giving consideration to each clause.

The Chairperson asked Mr Cachalia if he agreed with the situation.

Mr Cachalia was satisfied with the proposed process. Members had received a copy of the Bill, they would receive the DTI document the following day and the Creda version of the Bill on Monday so they would be prepared for the clause-by-clause reading on the Tuesday.

Mr Radebe agreed. If the Members received the Creda copy on Monday, they would be ready on Tuesday,

The Chairperson ensured that everyone knew what had to be done so that the reading could go ahead the following week. She appreciated the presence of the DTI officials and Adv Frank Jenkins of the Constitutional and Legal Services Office.

Closing remarks
The Chairperson asked the staff to tie up the visit to the South African Farmers Development Association in Durban. She also reminded Members of the open engagement with the delegation from the Federal Republic of Germany, South Africa’s biggest trading partner that would take place from 10:15 to 11:15 on 20 November 2018. Thereafter, Members would address the Creda version of the National Gambling Amendment Bill (NGAB). That would be followed by a consideration of the report of the High Level Panel on key legislation and acceleration as it related to DTI.

Mr Mahlobo suggested that on the Tuesday, following the consideration of NGAB, the Committee should tie up its work, i.e. the minutes related to the three Bills. There was a high possibility that on 21 November 2018, the Members would be debating the Copyright Amendment Bill in the House. He did not want anything outstanding from the Committee.

The Chairperson agreed. The High Level Panel report would be factored in later on.

The Committee Secretary stated that the minutes would be available for adoption on Tuesday.

The Chairperson stated that it was a credit to the Committee that the Members were still in attendance and applying their minds. The Chairperson thanked the Committee and the technical team for the hard work, and the Committee staff who seemed to have worked harder than usual in her absence.
           
The meeting was adjourned.

 

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