ZA Domain Name Authority (ZADNA) 2022/23 Annual Report; with Minister

Meeting report

ZADNA's 2022/23 annual report

Opening remarks

Mr Mondli Gungubele, Minister of Communications and Digital Technologies, said the Department of Communications and Digital Technologies (DCDT) was comfortable about the performance of the .za Domain Name Authority (ZADNA).

He said ZADNA was an entity that was anxious to meet its targets. One of the things that it would share with the Committee was what it describes as missed opportunities to increase the growth of the domain name, and also documenting and digitising the internal processes of the institution with a particular focus on human resources (HR) and finance. ZADNA would also report that it would continue to provide an expeditious alternative decision resolution process. He mentioned that it was one of the highest rated domain institutions in the world, in particular within the African continent.

Ms Palesa Legoze, Chairperson of ZADNA, and an information communication technology (ICT) consultant, said that ZADNA was not funded by government and was a self-funding entity. It was funded from domain name fees, and was in a good financial position. It had a surplus intended to be used in case something unforeseen happened.

Performance details

Mr Molehe Wesi, Chief Executive Officer (CEO), ZADNA, said that they had achieved 88% of their 16 targets, and had received an unqualified audit outcome. Currently, they have just over 1.38 million domains. He gave an assurance that what they had missed in the previous financial year, they would make up by ensuring they had digitised and optimised their internal functions to better serve the country. They would also ensure that they retained any form of institutional memory that could be lost due to undocumented and undigitised internal processes.

Ms Kedibone Mpholeng, Executive Manager: Finance, ZADNA, said they had restated their 2022 financial statements. Their revenue for the financial year was still sitting around R20 million. Other income came from various sources, including the alternative dispute resolution (ADR) fees received, the  Media, Information and Communication Technologies Sector Education and Training Authority (MICT SETA) funding, insurance, and other income, which was currently sitting at R2.1 million. Their net deficit was R3.8 million, which included their financing and interest received from all investments of R1.6 million. She explained that because of the revaluation that was done during the current year, they had gained R477 000.

(See attached document for details)

 Discussion

Ms L Bebee (ANC, KwaZulu-Natal) said it had made the world small that one had to use only one's fingertips to get connected. However, the same internet was a playground for cybercrimes involving scammers, fraudsters, and others. She asked what the role of ZADNA was in cases where some internet domains were found to be involved in either cybercrime or fraud, and if they deregistered such domains and what happened thereafter. Who maintained their infrastructure or servers, and did they use in-house skills or outsourced services?

Ms W Ngwenya (ANC, Gauteng) said it was interesting to know that the entity was responsible for internet governance in South Africa, and she hoped that the Department of Communication and Digital Technologies (DCDT) was providing the necessary support to this entity to carry on with its mandate. She asked how many women, youths and people with disability had been on ZADNA training programmes, how many had been supported, and how many were already entrepreneurs. Were they using external servers professionally to achieve their projects, and if so, who were they and how much expenditure was involved? She wanted clarity on who the strategic partners of ZADNA were during the 2022/23 financial year. Had their target been to achieve a clean audit opinion, and if yes, why did they not achieve it?

Ms T Modise (ANC, North West), asked if ZADNA had a signed performance agreement with their executives and employees, and if the entity signed a performance agreement with the Ministry or the Department at some point.

Mr M Nhanha (DA, Eastern Cape) said he thought the Minister had been kidding when he said ZADNA was one of the entities that was not giving a problem. For some reason, it had managed to fly under the radar. He wanted to keep a tab on the entity with a view to trying to pass on its good practices to other state-owned enterprises (SOEs) and entities that fall outside of their portfolio. He assumed there were international bodies that this kind of entity belonged to, and that they could provide some benchmarking.  He would like to see how ZADNA was faring compared to its peers across the globe.

The Chairperson said he wanted to check the composition of the ZADNA board, because account was often not taken of issues like geographic spread, particularly the representation of the rural communities, which were at the margins of society. They always wanted to ensure that community representation was a priority in institutions of that nature. When it came to ICT, they appreciated what ZADNA had started embarking on, by ensuring that they rolled it out to the rural communities, as there was a huge backlog in that respect.

He referred to the funding support that was made available to those that may be in need in both urban and rural areas, and sought clarity on who the recipients of this funding were, to ensure the money was not going in one direction.

He said the Committee had not had an active interaction with ZADNA regarding the role that it plays in the national sphere of the country. However, its significance in a Department responsible for communication made it important that from time to time, it needed to brief the nation on its annual results, the targets it had achieved, and its unbroken performance record from one financial year to the other.

Responses 

Minister Gungubele expressed gratitude for the compliments received. The Committee's counselling was very important, and he hoped they would receive reports on the work that the Department was doing before the end of the year, especially the impact they were beginning to make in the rural community.

Ms Legoze responded on the role of ZADNA concerning cyber security. She said there was something called the Domain Name System Security Extensions (DNSSEC), which was signing off the route to ensure that whenever websites were spoofed, people knew exactly which website it was, whether it was the right website, or if it was a spoofed website. The Electronic Communications and Transactions (ECT) Act, clause 77, addressed the issue of takedown, so that when there was illicit or harmful content online, and somebody reported it, that site would immediately be taken down.

If it came to their attention that something was going on regarding other websites and domain names under the ZA namespace, those namespaces would be deregistered, pending an appeal by those who had been found to be doing something wrong. ZADNA had a relationship with the police, and in case something went wrong, they were able to inform law enforcement so that they could take over whatever it was that they had discovered, investigate and take the matter forward.

Responding to the issue of performance contracts, she said the board had an agreement with the Minister, which they adhered to, and they also sent the board's work plan to the Minister. The CEO’s performance agreement was in line with the mandate of ZADNA, as per the ECT Act, and was submitted annually to the Department.

Describing ZADNA's relationship to international bodies, she said there was an entity called the Internet Corporation for Science Names and Numbers (ICANN), which administers and manages the internet globally, with which they had a relationship. ZADNA was a top-level domain name. They were ranked number one on the African continent, and in terms of the globe, they were doing well at number 28 out of the 110 countries.

Mr Wesi responded on issues of domain name abuse and cybercrimes. He said they were strengthening their relationships with those within the ecosystem, and had quarterly engagements with the Internet Service Providers Association (ISPA) of South Africa, which deals with the takedowns relating to their own members. Through their appointed registry, they ensure that processes and policies are followed to the letter, making available channels for raising issues around domain name abuse, which may be any infringement relating to an illegal activity utilising any .za domain name. There were processes in place through their own policy frameworks that forced the registrars to ensure that they had the means to report any domain name abuse, which was in line with international best practice on how to address any identified domain name abuse.

Through the guidance of the board and various partnerships, they introduced tools that would assist them to ensure that they proactively monitor the space and protect those that utilise it. ZADNA's response rate was quite good, and out of 640 top-level global domains, they were ranked low in terms of domain name abuse. Out of the 1.318 million domain names, they currently had only 2 200 cases of abuse.

Responding to Ms Bebee’s question about the infrastructure, he said that because they wanted to optimise their resources based on their current budget, they had opted for a hybrid model where they had services outsourced. They were hosted in the cloud, and maintained by various service providers. When they mentioned various service providers, it was in line with the prescripts and best practices of the organisation. In place, they had the ZA infrastructure run locally by one entity from Johannesburg, prescribing to best practices, from where it was spread across various data centres. ZADNA had internal resources that ensured that agreements, processes and infrastructure were looked after. It remained their ambition through various interventions to grow the entity's internal capacity.

He replied to Ms Ngwenya on ZADNA's demographics and statistics, saying that they had trained 853 women and 14 people with disabilities. They wanted to increase the participation of people living with disabilities. They were exploring partnerships with various associations that were keen to partake in that particular training. They used a significant amount of funding to appoint external service providers, but ascribed to the principle that once they had a professional service provider appointed, they needed to ensure that they imparted knowledge so that there was continuity internally to capacitate the team.

Referring to the audit outcome, he said they aimed to expedite prescripts from the audit outcomes, to ensure that there were no repeat findings, which would signal that internal controls were inefficient. Going forward, they would try to ensure that they had appropriate systems, checks and balances in place to attain a particular target.

Providing details on global entities, he said ZADNA formed part of the African Network Information Centre (AFRINIC), as appointed by ICANN. They also formed part of the African Top Level Domain Name Association. Through the Department, they had been provided an opportunity to partake in key processes relating to International Telecommunications Union (ITU) engagements.

Describing the ADR process, he said that it was actually a paid-for service, where an individual who would like to dispute the particular ownership of a domain name would then send a request through to them. They would take it to accredited intellectual property adjudicators or legal practitioners. They would then appoint a full panel of adjudicators.

Regarding funding, ZADNA had quite clear prescripts as to who they fund and how they fund them. They target the marginalised, those who cannot afford the funding, and offer funding for one adjudicator, which was permissible per the regulations. In terms of the geographic spread, they had embarked on communicating with various forums to ensure that if the citizenry was interested in actually receiving funding, they were well-informed, and that ZADNA was willing to expedite it. However, there had not been any keen pick-up or uptake of that particular service, but they would share an update and a breakdown of the details through formal channels, as requested by the Committee.

In terms of strategic partnerships, he said that during the year under review, they had forged a relationship with a number of entities. This included the Free State Black Business Council, where the ambition was to go to small, medium and micro enterprises (SMMEs), and communities with skills around the DNS. They had partnered with Innovolution Edu Programmes, an organisation based in Gauteng, focusing on providing educational programmes in townships and schools. ZADNA was coming in to digitise the schools they had adopted. They had partnered with the Department of Education in the Free State, where they were going to digitise their schools by providing domain names, a learning management system for the schools, while they provided emails for every learner and educator within the school.

Through their partnership with the MICT SETA, they have been able to empower 30 young people across the country with a short course on DNS practitioners. They set up two researchers focusing on internet governance and domain name services research. This empowered students to conduct their PhDs and master's degrees.

Ms Legoze said there were currently seven board members, two of whom were male and five of whom were female. Regarding the ECTA, there were supposed to be nine board members, but two members resigned in the last financial year. Regarding the geographic spread, most board members were from Gauteng, and the Department advertised for the new board. In the new term, there would be the geographic spread the Committee had suggested. The internet was not just for urban areas, but even for people in the outlying areas, and this was an important reason why ZADNA needed to go to the rural areas and engage and train young people so that they could become part of the digital economy.

The Chairperson said he would like to get a sense of where ZADNA was in the African continent, because South Africa was known as a springboard for economic development in the entire region. He wanted to know if there was an African strategy as well. There was a huge dominance of foreign domains on the continent, including Google, and his perspective was that it was not good for South Africa to be beaten in their own space in a post-colonial Africa. Therefore, an entity like ZADNA should be towering in the continent, ensuring that South Africa played the role that it was expected to play as one of the leading economies on the continent.

Closing remarks

Minister Gungubele said the asserting of South Africa in the ICT sector was not only a ZADNA issue; it was the bigger challenge of who dominated their network on the continent. There was a significant presence of extra-continental institutions, and there was quite a lot of work that the Department had recently been interrogating, asking themselves how they would assert themselves as a continent, especially from the network point of view. He emphasised that it was not just a ZADNA issue -- the question raised cut across the sector and the entire Department and its 11 entities.

The Chairperson said that sometimes officials just used the electronic signature without passing things by him, and he apologised profusely for that. He expressed appreciation for the interaction, and said that it was the Committee's role to ensure that they conducted oversight on all the entities. All invitations must be extended to the Committee to participate, because it gave them ammunition to be able to vouch for the work that they were doing.

He commended the ZADNA board for their work, and encouraged them to gather strength and improve their performance in the year ahead.

The meeting was adjourned.