Industrial Development Bill: negotiating mandates; Merchandise Marks Amendment Bill: finalisation
NCOP Economic and Business Development
24 October 2001
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Meeting report
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The aim
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report is not a verbatim transcript of proceedings.Â
economic and foreign affairs select
Committee
24 October 2001
INDUSTRIAL DEVELOPMENT BILL:NEGOTIATING MANDATES; MERCHANDISE MARKS AMENDMENT
BILL: FINALISATION
Chairperson: Mr V. Moosa (ANC)
Documents handed out:
Industrial
Development Amendment Bill [B32B-2001]
Negotiating Mandates on Industrial Development Amendment Bill [B32B 2001]
(Provincial Legislatures)
Merchandise
Marks Amendment Bill [B33-2001]
Portfolio Committee Amendment to the Merchandise Marks Amendment Bill
(Department of Trade and Industry)
Briefing Notes: Merchandise Marks Act, 1941 (Department of Trade and Industry)
SUMMARY
The Select Committee heard and discussed the negotiating mandates from the
nine provinces on the Industrial Development Amendment Bill. Legal representatives from the Department of
Trade and Industry and The Industrial Development Corporation responded to
Committee members questions and concerns.Â
Only one of the mandates was accepted by the Committee. The Committee agreed to return the Bill to
the provincial legislatures for final approval. The DTI representative, Mr M. Netshitenzhe, presented the final
draft of the Merchandise Marks Amendment Bill.Â
The Committee approved the Merchandise Marks Amendment Bill.
MINUTES
Negotiating Mandates on the Industrial Development Bill
The Chairperson opened saying that there were two items on the Committee's
agenda: (1) the provincial negotiating mandates on the Industrial Development
Amendment Bill, and (2) final comments and discussion on the Merchandise Marks
Amendment Bill. He said that the
Committee would begin with the negotiating mandates and turned to the
representative from the Eastern Cape.
Eastern Cape
Mr B. Dlulane (ANC) stated that the Eastern Cape generally supported the
Bill. The questions that it raised were
(1) what mechanisms were in place to monitor loans, (2) what currency would be
used for transactions, and (3) if transactions were to be carried out in the
South African Rand, would this would lead to South Africa becoming the “Big
Brother� of Africa.
The Chairperson stated that the Committee would address issues as they arose
and paused to introduce the individuals who would field questions on behalf of
DTI and the Industrial Development Cooperation (IDC). The legal advisor present from the Department was Mr J.
Strydom. The legal representative
present from IDC was Mr L. Jiya.Â
The Chairperson responded that mechanisms were in place to handle loans and
asked the Eastern Cape to recall the Credit Guarantee Insurance Scheme
(CGIS). He said that the allowed
currencies would be both the US Dollar and the South African Rand.Â
Eastern Cape then granted mandate to support the Bill.
Free State
Mr T. Setona (ANC) said that the Free State did not support the Bill, nor
did it suggest amendments. Mr Setona
rationalised that his province felt as though the amendment process was too
lengthy and complicated.Â
The Chairperson informed Mr Setona that the Committee required more detailed comments
from the provincial legislature. He
reminded him that the Bill had been sent to all provincial legislatures some
time ago after it had gone through the National Assembly. Two weeks had been allotted for
deliberations. Gauteng, for example,
had used that time-period to hold public hearings. He informed the Free State that thereafter the Committee would
require negotiating mandates, and Mr Setona would have to communicate this to
his legislature. Â
Gauteng
Dr Conroy (NNP) of Gauteng stated that the legislature wanted clarification
on the broader mandate of DTI. Gauteng
was curious as to how DTI envisioned further support to develop projects that
were already underway.
Mr Jiya responded that DTI would like to figure out how to better support those
projects as well as lend support to projects it had neglected in the past.Â
Gauteng stated that it supported the Bill.
KwaZulu-Natal
KwaZulu-Natal reported that it supported the Bill with lengthy
amendments. The provincial
representative proceeded to list the legislature's amendments. In Clause 3, page 4, lines 3 and 4, the
amendment was to paragraph (b) of section 5, in line 3, to delete the word “to�
which appeared before the words “the labour supply;� and in an amendment of
paragraph (b) of section 5, line 4, the word “to� which appeared before the
words “the rates of wagesâ€? was deleted.Â
In Clause 3, page 4, line 7, an amendment to paragraph (c) of section 5,
line 7, substituted the words “paragraph (b) of section 3� with the words
“section 3(b).� In Clause 6, page 4,
line 27, an amendment defined the term “non-executive director.� In Clause 11, page 5, line 10, an amendment
deleted the word “then� which appeared before the word “sitting� at the
beginning and end of the line. In
addition, in order to clarify issues, KwaZulu-Natal requested a rationale from
the Department for the amendments proposed in (1) Clause 2(b), page 3, line 20,
amending section 4(f) of the Principle Act; (2) Clause 9, page 4, line 44,
amending section 16 of the Principle Act; and (3) Clause 10, page 5, line 2,
amending section 18(h) of the Principle Act.
The Chairperson asked the Committee to begin with the final three
questions. He looked to DTI for
comments but then paused to remind members that Clause 2(b) had been dealt with
extensively at their last meeting. He
added that Clause 9 had been dealt with exhaustively as well, and there was no
getting around the amendment.Â
Mr Strydom asked the Chairperson for more time to read through the proposals
from the KwaZulu-Natal legislature. The
Chairperson granted him the time it would take to hear from the remaining
provinces.
Mpumalanga
The representative from Mpumalanga stated that it supported the Bill
without amendments.
Northern Cape
The representative from the Northern Cape was absent, and the Chairperson
read aloud the province's support of the Bill.
North West Province
The representative from North West Province stated that his legislature
supported the Bill; however, it had raised the concern that the Bill neglected
the rural population.
The Chairperson informed the representative that his document began by stating
this concern on page one, but the second page lapsed into discussion of stray
animals on public property. He told the
member that he would give him time to take care of the confusion and provide
the proper documentation.
The Chairperson asked Mr Strydom whether he was ready to discuss the issues
raised by KwaZulu-Natal.Â
Mr Strydom started with page 4, line 3, where he said he was confused by what seemed
to be a grammatical correction.
Mr Jiya stipulated that the grammar did not need to be corrected.
The Chairperson suggested that KwaZulu-Natal's objection was that the section
was not readable. He asked whether the
section could be reformatted to arrange points numerically. He stated that the problem was that the
Principle Act had been written in 1941.Â
Both language and layout needed to be modernized.Â
Mr Strydom stated that, if they did that, it would also be necessary to
restructure Section 5, and that would be a fairly material amendment.Â
The Chairperson said that the Committee and the Department should think about
it, but, regardless, it did not make sense to delete the “to� as KwaZulu-Natal
had suggested.Â
Mr Durr (ACDP) commented that the language in the Act was simply not good law
and not good English.
The Chairperson agreed with Mr Durr and asked Mr Strydom to move on to the next
concern.
Mr Strydom stated that the Department was being asked for some unknown reason
to substitute the words “paragraph (b) of section 3� with the words “section
3(b).�
The Chairperson suggested that the proposal was not major and asked whether
there were any objections. There were
none.
Mr Strydom stated that everyone present knew that the Bill was originally
written in 1941 and had undergone amendment no less than a dozen times. He acknowledged that he would not disagree
if someone said that the Principle Act was in need of an overhaul.Â
Regarding the use of the term “non-executive director,� Mr Strydom continued,
it was in the context of the Act.Â
KwaZulu-Natal was asking for definition of executive versus
non-executive.
The Chairperson interjected that KwaZulu-Natal's point was interesting, and
that, if the language was examined carefully, it did pose an interpretive
problem.Â
Mr Jiya explained that there were no executive directors within the structure
of IDC. Rather, they were the
equivalent of “vice presidents.�
The Chairperson stated that this needed to be changed. He asked if there was no one with the title
“executive�?
Dr Conroy suggested that they simply delete “non-executive.�
The Chairperson agreed with Dr Conroy.Â
Mr Durr disagreed suggesting that the Bill said exactly what it meant.
Dr Conroy suggested that the meaning was that the Chair should be
non-executive, meaning that he was not an executive.Â
Mr Setona said that the Committee needed to make sure of the IDC's meaning
before going further.
Mr Durr said that these terms were defined in the company's act and were, or
should have been, understood by anyone in the business community.
The representative from KwaZulu-Natal said that he just wanted to know the
difference between a director and a non-director.
The Chairperson asked the IDC for an explanation.
Mr Jiya explained that there were two executive directors in the IDC structure:
the Chief Executive Officer (CEO), the President, and the Chief Financial
Officer (CFO). There were twelve
non-executive directors. Mr Strydom
continued stating that the most important thing, and the sole meaning of the
legislation, was that the chairperson was excluded from being a director.Â
The Chairperson asked Mr Jiya, IDC had a President and a CEO?
Mr Jiya clarified that they were one in the same.Â
The Chairperson then asked who the managing director was.
Mr Durr commented that “Americanisms� (i.e. the use of the term “CEO�) were
creeping into South African language.
The Chairperson insisted that the language needed to be consistent.
Mr Durr pointed out that businesses went through phases with language according
to what trends dictated; however, whether or not a company called its managing
director an “MD,� a CEO, or a President did not change the title of the
executive in the law.Â
Mr Jiya conceded that, as a statutory body, the IDC needed to be consistent
with the law.
The Chairperson asked the Committee to drop the issue and take it up the
following week.
Mr Strydom moved on to the next proposal.Â
He said that he did not have strong feelings about deleting the word
“thenâ€? from Clause 11, page 5, line 10.Â
However, if the Committee were to support the amendment, it should also
support the omission of the word “then� where it appeared in an identical
capacity in line 9.Â
The Committee agreed.
Mr Strydom then stated that KwaZulu-Natal was asking for an explanation of
Clause 9, page 4, line 44.
Mr Durr explained that the legislation was proposing that, because the IDC
portfolio was owned by the State, it would be possible for the government to
receive dividends from the portfolio.Â
This practice would be in line with the government's dividend-sharing
arrangement with Eskom.Â
Mr Strydom said that there was one last question to address for KwaZulu-Natal
and that was why the amendment was banning the use of the government seal. He answered that the government seal
referred to was the one that was used when the Principle Act was written, and
it was now obsolete.
The Chairperson asked the North West Province representative whether it had
sorted out its document mix-up.
The representative responded that he had and proceeded with the province's
concerns. First, the province asked
whether the Bill could capitalise “provincial legislatures� and “municipal
councils� because it capitalised Members of Parliament.
The Chairperson asked the Committee whether it had any objection.
Mr Durr objected, explaining that, since there was only one Parliament in South
Africa, it and its members were capitalised according to grammatical rule. The same grammar rule did not apply to
provincial legislatures or municipal councils.Â
The representative from the North West Province then asked whether a
time-period could be assigned to the dividend program.
Mr Fenyane (ANC) said that the dividend agreement was not unique to the IDC
Act. He clarified that the time frame
could not be “fixed.�
Thirdly, the North West Province representative stated that the name of the
Bill should read exactly as it read in the original Act.
Mr Strydom explained that language disagreement was standard drafting process and
the title of the Act would automatically change once the amendment was voted
into effect.Â
The Chairperson asked the Committee to agree on the final document that would
be immediately returned to the provinces for final mandate.Â
Mr Durr asked the Chairperson whether this was realistic.
The Chairperson responded that the document would be ready by the afternoon for
members to take back to their legislatures.
Finalisation of the Merchandise Marks Amendment Bill
The Chairperson introduced Mr M. Netshitenzhe from the DTI to go over the
Merchandise Marks Amendment Bill. He
reminded the Committee that the Bill had passed through the National Assembly
and the amendments were strictly of a technical nature.
Mr Netshitenzhe briefly listed grammatical changes to the document.Â
The Chairperson stated that the National Assembly had only made one amendment,
to page 3, line 25.
Mr Strydom informed the Committee that there was fault with the National
Assembly amendment. The technicality
was with the word “deemed.� He said
that the National Assembly amendment actually made the clause more confusing
and asked the Committee whether it would agree to remove the second clause
entirely from the document on the grounds that it would strengthen the language
of the act.Â
The Chairperson agreed with Mr Strydom's suggestion. The Committee approved the Bill and the meeting was adjourned.
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