Private Sector Application (horizontality)

Meeting report

JOINT AD HOC COMMITTEE ON THE OPEN DEMOCRACY BILL
23 November 1999
PRIVATE SECTOR APPLICATION (horizontality): DISCUSSION

Documents handed out:
OPD 90: First draft of proposed new part to provide for access to records of private bodies
OPD 90a: Draft proposal for access to records of private bodies made by Dr J Delport (DP)
Document dealing with whether bodies fall under natural or juristic persons drafted by Adv van Schoor

SUMMARY
The discussion revolved around the new draft on how access to information applies to the private sector. The main issues discussed were related to the use of the term "any person" as opposed to "everyone" and how far this right will extend in its application.

Chairperson de Lange announced that hearings on the Administrative Justice Bill would probably start this Friday, 26 November. They have about 30 submissions but not all of them have requested oral hearings. He has also provided the Justice Portfolio Committee members with all judgements relating to administrative law so that they will have an idea of where administrative law in South Africa currently stands.

MINUTES
The Chair opened the discussion on private bodies. The relevant documents are ODB 90 and ODB 90(a). The Chair said that they would come back to the discussion on ODB 90(a), which was the draft done by the Democratic Party (DP). The drafters in ODB 90 had looked at the part of the Bill dealing with public information and had taken parts out and re-worked them for the private sector. Some of what is included in this new draft is repetitious of what is in the draft for the public sphere. He said that they could come back to the definitions later, but for now he really wanted to have people comment on Chapter 1 (general provisions).

Mr Smith (IFP) wanted to make sure that the definition of private body also included to what extent that body functioned in the public sphere. If the body functions more in the private sphere, is it then going to be considered private?

The Chair said that a body that could be considered both public or private will be classified depending on what capacity they were functioning in relation to the information being requested. Did they act in their public or private capacity? He was not sure if the definition needed to say any more than it already did.

Mr Smith was concerned that the definition did not really make that point clear. He suggested redrafting it to be sure that it was clear that was how those types of bodies would be classified.

The Chair said that he thought that Mr Smith's concern was covered by the current definition, but he asked Ms van Schoor to look at it anyway to see if Mr Smith's concern could be addressed better. He then moved the Committee onto Chapter 1.

Ms Jana pointed out that clause 1 of the draft used the language "any person" whereas the language in section 32 of the Constitution used the term "everyone." She believed that the "everyone" was broader than "any person." She wanted to know why the term "any person" was being used.

Ms Smuts raised the same point, in addition she wanted to add the phrase "subject to this Act" to the end of clause 1.

The Chair said that he would pass that stylistic issue onto Ms van Schoor, but if that point was already in the DP draft, then Ms van Schoor already has it to look at. The issue really is in distinguishing between "any person" and "everyone." He does not really think that it is a constitutional issue, because of the effect of the limitation clause, but he did want to explore whether or not there was a distinction between them so far as their use in the Constitution.

Ms van Schoor said that it was true that "everyone" was the language used in the Constitution in relation to this right, but that her understanding was that "any person" meant to include all people - in effect having the same meaning as "everyone." She did not see the difference between any person and everyone.

Ms Jana said that there was a difference between the terms. In the Constitution there are places where one term is used over another term. If it was merely a question of language, then the Constitution would have just picked one of the terms and used it throughout.

The Chair said the point was noted, but he wanted to know what the distinction was between them.

Mr Swart (ACDP) said that the use of the term was dependent on the definition of person that they were using in that particular section of the Constitution. The use of the term was dependent on the context.

The Chair asked them to look at the definition as it is in the Bill - natural and juristic person. How would using one term over another impact on that definition? What limitation is there in using "any person?"

Ms Chohan (ANC) said that the crucial question was what the difference was between the two terms. A while ago the Committee had asked whether or not an association could be a juristic person in terms of this Bill, and the Committee agreed that it could be seen as such. She now thinks that this is incorrect. Clubs and associations are not juristic persons so far as insolvency law - so they probably should not be considered as such here. She is not sure if "everyone" would capture those people that fall outside of juristic persons either. Does anything capture those particular bodies? She wanted to know how much they really wanted to open up this issue. She believed that the term juristic persons did in fact exclude certain associations.

Ms van Schoor said that the document she had prepared deals with these issues specifically - whether bodies fall under natural or juristic persons. Common law principles also help to determine whether or not a body is juristic or not. In terms of that document and the categories covered in it, are there any other categories that fall outside of the definition of juristic persons?

Ms Smuts asked whether this discussion was even relevant. Looking at section 32(b) of the Constitution you cannot even exclude international or foreign people from access to information.

The Chair asked if there is anything beyond "any person"? The law is clear on associations. If a body does not fall under the legislation, then it will fall under common law. Are there things other then associations that people think fall outside of the definition? He said that he did not have a problem using the term "everyone," but he wanted to know where they are going if they use that term.

Mr Smith said that if churches and clubs are included in the definition, then he does not have any problem in retaining "any person". In terms of who this right applies to, he said you cannot apply it only to South African citizens. You will also have to apply it to foreigners. Perhaps the right could be limited to once the foreign person is in the country.

Ms Jana agreed with Ms Chohan that the term juristic persons excluded certain associations. As she might be wrong, she said she would look at Ms van Schoor's document.

Mr Masutha (ANC) said that the issue was whether or not you have a list of certain criteria saying what is an association. The whole question of whether or not you are a natural or juristic person could fix into that context and discussion around that issue is relevant, because the Constitution does not have an answer.

The Chair said that the issue is what the end result of the language they finally chose is going to be in terns of applying this legislation.

Ms Smuts said on the issue of foreigners that you cannot exclude foreigners, because then you will be excluding a huge part of what sustains the economy. Your rights are your rights and they are checked by other competing rights.

The Chair said that all he wanted was to know where they were going with this part of the legislation in the end. He reminded everyone that this legislation was putting duties and obligations on companies in terms of access to information. The width of this clause will determine the extent of those duties and obligations. What kind of burden do they want to put on these companies?

Ms Chohan raised the issue of persons again. She agreed with Mr Masutha's point on establishing criteria. She said that partnerships are not juristic persons (as indicated in the document that Ms van Schoor had prepared). There can be huge partnerships. If an employer within that partnership needs access to information, then how is he going to do that if partnerships fall outside the definition?

The Chair asked if partners did not exercise their rights as natural persons? You would be able to sue them as individuals for access.

Ms Chohan said that you would then be using the definition as a blanket cover. If you do not fall under juristic persons than you fall under natural?

The Chair said that the only issue he saw was the one that Dr Delport had raised in the DP draft (ODB 90(a)), which is when you have a bridge or Tupperware club. These types of unorganized associations may not fall under the Bill. If they are not well organized, then you would not sue them as the bridge club you would sue them as an individual under natural persons. He asked if these types of persons would be included if they used the term "everyone" instead. He said he did not know what the courts were going to interpret, but more then likely in those cases the person would be classified as a natural person.

Ms Chohan said that she agreed with what the Chair had just clarified but she was still concerned with the issue of what is meant by the "exercise" of rights. Do you not want to restrict that to some degree because of the amount of burden that it would place on this sphere?

Mr Swart suggested sticking as much to the language used in the Constitution as possible rather than using other words. He said that they were here to give effect to the Constitution and the best way of ensuring that they do that is by using the language in the Constitution. Section 32(1)(b) does not clarify "everyone," but that is the term used, and they should also use that term. He also raised a concern about the language "is required" in section 32(1)(b), and he wanted to know what kind of burden this would place on the private sphere.

The Chair said that Ms Jana had raised this point because the term "everyone" is broader in scope that "any person." He pointed out clause 10 of the Constitution and said that the term "everyone" was used in relation to human dignity, and that everyone clearly meant natural persons in that context. Why should he accept that "everyone" is broader than "any person" when the Constitution does not make that clear? If the courts determine that "everyone" is wider, then who else would be included if they used the term "everyone" over "any person?"

Mr Swart said that if you use the language in the Constitution, then you would avoid this whole debate.

Mr Landers (ANC) said that he understood the problem raised by Ms Jana. He said the difficulty is that the term "any person" may leave certain clubs and associations out of the loop. This conclusion was based on how he saw the Constitution using the term "any person." (he referenced section 8 (2) of the Constitution - application of the Bill of Rights). He acknowledged that they had not answered the Chair's question on how much wider is the term "everyone". He said that it does not mean that using "any person" would actually exclude associations. In the end, he thought that it would be wise to follow Mr Swart's suggestion of using the exact language of the Constitution.

Mr Masutha said that the use of "private body" was a misnomer. The definition of natural and juristic persons does include associations. It may be important to revisit the terminology that they are using in this section. The terms that they use in this section should match the terms used in section 32 of the Constitution. The Constitution does not deal with private bodies it deals with people, which means that private bodies can only refer to juristic persons and not at the same time natural persons.

The Chair wanted to know if his concern was not resolved by the definition they had used for private bodies?

Ms Jana said that she now had read Ms van Schoor's document on how natural and juristic persons are categorized, and she still held the same view as before. The courts have held that not every association is a juristic person and certainly partnerships are not juristic persons. It is true that individual partners can raise issues as natural persons, but not as an association. There are groups that are going to be left out. The term "everyone" would cover those left out.

The Chair agreed that partnerships are not juristic persons. But he felt that the only groups that would not be covered by the definition of natural and juristic persons would be those small unorganized groups such as bridge clubs. It is obvious that these small unorganized groups do not fall under that definition nor the common law definitions. There is no argument on that issue.

Mr Mgidi (ANC) asked how foreigners are given access to information in other democracies? He also wanted the Committee to bear in mind the costs (especially to small associations) in giving this level of access.

The Chair said that everyone knows that the regimen that they are trying to create here does not exist anywhere else in the world. There is no answer as to what other open democracies do because no one else has attempted this before. He said that they would come back and look at the issue of cost later.

Mr Durr (ACDP) asked whether they going to have limitations if they allow foreigners the right to access information. How are they going to police in what way a foreigner uses their information once that information leaves their jurisdiction. There would be no reason why a foreigner would have to follow South Africa's copyright laws once they take the information from South Africa.

The Chair remarked that this was an excellent point - how are they going to regulate the use of the information that a foreigner takes out of the country since there is agreement that the language in section 32 extends the right to to foreigners as well.

Mr Smith said that section 8(2) of the Constitution does not have a third category for non-natural persons. He felt that "any person" and "everyone" meant the same thing. The main issue that they should be discussing is the extent to which foreigners NOT in the country (like shareholders) will have access to information. What about foreign employees that work for South African companies? There are two issues: how you deal with foreigners in the country and how you deal with foreigners out of the country that want access. The copyright issue comes into play again.

Ms Chohan wanted to know what other countries do. Will they be able to impose penalties for abuse of information with regard to foreigners misusing the information?

Mr Masutha said that if the term "everyone" did have a specific fixed meaning, then it would have been easy to use it again here with that same meaning or in another place in the Constitution with that same meaning.

The Chair said that was a good point. In one context in the Constitution it seems that the term means natural person and that in other contexts it seems to mean more. That is exactly the reason why he is asking what the committee wants it to mean. He feels that that the capacity that you act in is the capacity in which you will be sued. He said that because they are proposing a new law that they do not know the consequences of it. It is true that no matter if you use the term "everyone" or "any person" foreigners are included. They need to decide on the term first and then whether or not they want the right extended to foreigners. When you talk of foreigners you are not just talking about individuals, you are talking about groups like CNN and businesses having access. This raises the issue of what is meant by the terms "exercise" and "any right" in section 32(1)(b). How far do you want you obligations and duties to go in this sphere? Essentially, the main issues are whether they should use the tem "everyone" or "any person" and whether or not foreigners should be restricted or limited in their use of this right.

The Chair commented that when he passes a Bill he wants to know that the committee did the best that they could, and the only way to ensure this is for them to discuss it and to challenge each other. Typically, they do look at what other countries have done, but they cannot do that now, because they are the first to attempt this. This Chapter is ground breaking so they need to work through all of the issues. If it seems like time is being wasted on a point just keep in mind that it really is important to discuss anything that they think may be a problem. They need to deal with this issue of "everyone" first, and they will get to the issue of foreigners later. However, they do need to discuss what is meant by the terms "exercise" or "protection" and "any rights." How far do they want this obligation to go?

Mr Smith said that although they have the general limitations clause, section 32(2) of the Constitution only applies to the State or the public sector. They do not have a limitation clause like that for the private sector, all they have is the general limitations clause.

The Chair said that 32(2) was an additional limitation, but he felt that it really would have been covered by the general limitations clause. He saw it as being double protection, but what Mr Smith was pointing out was that this extra protection does not apply to the private sphere.

Mr Masutha said that they weigh the terms "exercise" / "protection" of rights of an individuals (natural persons) on the one hand and juristic persons on the other. The issue is how are you going to weigh competing rights? For example, the media said that information falls under the right to privacy so that they do not have to give access. How do you weigh which right wins? He felt that you should be more inclined to protect the individual rather than big companies.

The Chair said that they need to ask how the weighing of rights will play out in practical terms. There is no pecking order of rights in the Constitution. The two issues are when rights clash and how the limitations clause applies. There is a balancing act. Perhaps the solution lies in the use of adjectives. Create tests like "substantial harm" to determine which direction the scale should tip. Typically they do use such adjectives to formulate tests to determine when one right should win over another. Under the private sector, they should also create such tests.

Ms van Schoor said that she had provided four options in Section 14, which establishes tests similar to what Chairperson de Lange was talking about. Each option contains a different test.

The Chair said that the DP draft that Dr Delport had written (ODB 90(a)) also lists criteria on how to exercise and protect. All of these options need to be examined to see which would best balance the competing rights. They need to determine which to use. The difficulty is that they need to look at the options in terms of the limitation clause as well. Is the word "exercise" a limitation in and of itself? The obstacles a person would have to jump are that you show you have a right and that you are trying to protect it, then you have to see if any of the exemptions apply, and then you have to deal with fees. In the public sphere you only have to deal with the exemptions and fees. You do not have to prove in that sphere whether or not you are exercising or protecting a right.

Mr Masutha said that the only issue is really in the publication of information. Perhaps they should have an exemption that deals specifically with publication

The Chair said that the issue was broader than just a privacy argument and a right to information.

Ms Jana asked if the government has a right to get information held by private bodies as well? Does the term "everyone" cover this as well?

The Chair said that perhaps this is true.

Ms Jana said that there may be instances when the government will need to request access to information from the private sector, and the law should not preclude them from this access. One example would be if the government needed access to the results of a research project.

Ms Taljaard (DP) asked about the ambit of the right. Some of the rights in the Constitution apply to second and third generation rights. Will this right also extend that far? How are they actually going to use this right? How far do they conceptualize this right, and how far do they want it to extend internationally?

Ms Chohan returned to the issue of exercise and protection of rights. She felt that Ms Taljaard was right in pointing out how far they want the legislation to extend. She felt that "any rights" needed to be regulated by some mechanism that would limit what that meant. It is an issue that extends beyond just constitutional rights. This legislation will impact foreigners and the international community. This discussion should be about restrictions and limitations. Perhaps the way to limit "any rights" would be to use the language in the Constitution as the drafters probably had in mind that the right should be limited, being aware that this would be ground-breaking legislation. At the extreme, exercise and protection would mean litigation.

[Ms Jana was asked to act as Chair while Mr de Lange dealt with another issue]. Ms Jana felt that to exercise a right also meant to invoke it ,and that exercise was not limited to litigation.

Ms Chohan said was trying to point out the extremes. Exercising the right to commercial freedom would mean going to court. She felt that they needed to find a middle ground in between the two extremes, but she was not sure if they would find that middle ground. She felt that the narrow approach would solve a lot of problems relating to foreigners and the points that Mr Smith had raised.

Ms Jana summarized Ms Chohan's points: "any rights" means any rights in their Constitution as well as any in the world, foreigners have the right to access as the right is drafted now, the definition of exercise could be looked at narrowly so as to be restricted to litigation or it could be looked at as the broad exercise of rights. She then asked Ms van Schoor if she had any input.

Ms van Schoor that all rights did not apply only to those in the Bill of Rights. All rights included statutory law as well, and that might also include international law. She had not thought of looking at "exercise" in its narrowest form. On the issue of government being able to access information in the private sphere, she said that there is argument in support of allowing government such access, but there is no case law.

Mr Smith said that his initial reaction had been not to allow government access to information in the private sphere, but it may be constitutional to allow them access. He agreed that "any rights" did go beyond just the rights in the Constitution. Sections 231(4) and (5) of the Constitution relate to international agreements, which is proof that this right would extend to international law as well. Further, this right also includes state law as well. He was not sure how state law would impact on this legislation though. He thought that one way of limiting this right would be to limit the word "required" instead of focusing on the term "exercise." The test for the term "required" is very high. He said it was like section 14 of the draft on the private sphere. He wanted to know why they could not have all of the options listed in clause 14. Each option could be a different test - make it like a sliding scale. All of the options are restrictions. You would have several options available, but not all of them will apply to each situation.

Ms Jana summarized his point and said that you could apply any one of the options and you could do this by inserting language like "If any one of these options apply." Mr Smith wanted the legislation to be wider than just having one option.

Ms Chohan said that she was not sure to what end that suggestion would get them. How would the options apply in practice? How did Mr Smith think that the options would work, and what does that suggestion solve?

Mr Smith said that he was just pointing out that using all the options was not impossible. There would still need to be an appeal mechanism. He really did not have any firm views on it, but he pointed out that the task of limiting the term "exercise" was going to be very difficult.

Ms Jana said that since they are giving extraordinary rights here that Mr Smith was looking for a way of limiting it.

Ms Chohan said if they go that route, then that would increase the level of uncertainty in relation to this legislation. You do not want to leave too much for the courts to decide.

Ms Jana pointed out that she did not think using the term "everyone" would imply that it included everything.

Ms Chohan said that any rights apply here and all right as well. Rights even beyond their country are going to apply. What are they going to do if someone sues in a different country under a different jurisdiction? She did not want them to exclude that scenario from consideration. The restriction is that a person must have some basis for which to go to court, which gets back to what she was saying earlier about looking at "exercise" narrowly.

Mr Matthee (NNP) said that the restriction should only apply when the matter is in our courts. He then raised the issue of locus standi.

Ms Chohan said that you cannot get away with only restricting to courts in South Africa. You must deal with the issue as it relates to other jurisdictions as well. The issue is not around locus standi.

Mr Smith said that he could understand how you have to have a test in protecting a right, but he said you could not apply that same test to the exercise of a right. What is the distinction between exercising a right and protecting a right in practice?

Mr Lever (DP) wanted to bring up the issue of locus standi. He said that sections 38 (c ), (d) and (e) of the Constitution (enforcement of rights) are where the issues are going to come from. You cannot expect that a test involving locus standi is really going to restrict. Further, he wanted to say that he did not feel that the right to access information in the private sphere should extend to the State.

[Chairperson de Lange resumed his position as Chair[. Adv de Lange pointed out that section 38 was also a right, which meant that the limitation clause applied to it as well.

Mr Masutha said that all section 38 does is elevates a person's INTEREST in the matter as the basis for a person's right to sue for access to information. He disagreed with Mr Lever's point, when he argued that the State does not have the right to access information in the private sphere. The State might need to access information in the private sphere in order to access another right.

The Chair said that the problem is solved by creating a test where the State will have to prove that they have a right to access that information. If the State fails to show that they have that right, then access will be denied and they would not even get to the next hurdle which is the exemptions. He wanted to remind them that the definition also included public bodies as well. Do they really want to exclude the State as well as public bodies?

Ms Chohan said the Mr Lever may have been correct in saying that if you are going to limit this right through the use of locus standi, then in effect you are not limiting it at all. For the benefit of Chairperson de Lange she repeated her earlier suggestion as to how to limit the right. A possible limitation would be to look at the term "exercise" in its most narrow form which would be to say that you exercise your right by going to court. She said to look at the term "require." There are going to be instances where you are going to need certain information just to form a basis for going to court.

The Chair said that was a difficult concept to understand. How do you know what right you want to protect without the information? It is almost impossible to overcome that. He admitted that she had raised an important point. The term "requires" really is problematic.

Mr Smith (IFP) wanted to get back to the distinction between exercise and protect. Are they going to keep them together or have a separate test for each. It is important to figure out what the words actually mean. To protect your right you must show that you cannot exercise that right.

The Chair pointed out - as with the Freedom of Expression - you need the information to form a view or opinion on it. You cannot exercise your right to expression without first having the information, which is the point that Ms Chohan had aised. You must first get the information before you can exercise your right, which is a very strict test.