Broadcasting Amendment Bill: deliberations

Meeting report

COMMUNICATIONS PORTFOLIO COMMITTEE
16 October 2002
BROADCASTING AMENDMENT BILL: DELIBERATIONS

Chairperson:

Broadcast Amendment Bill [B34-2002]
DA Proposed Amendments (Appendix 1)
SABC and Department of Communications Amendments (Appendix 2)
ICASA Proposed Amendments (Appendix 3)
ANC Proposed Amendments (Appendix 4)
Amendments Proposed by Department of Communications (Appendix 5)
Freedom of Expression Institute Proposed Amendments (Appendix 6)

SUMMARY
The SABC broadly agreed with ICASA on many of the major points, which were provisionally accepted by the Chairperson. A number of amendments were proposed but no formal deliberations were undertaken. In the afternoon session the Committee completed the informal deliberations stage by considering Clauses 6, 21, 23 to 31 and the Schedule, and proposed certain amendments. The ruling party agreed to amend Clause 6 of the Bill to now grant the power to decide on the SABC's editorial and broadcast policies to the independent regulator.

MINUTES
The Chairperson asked for a motion of desirability for the Bill.

Mr Mahlatse (ANC) moved the Bill, which was seconded by Ms Vos (IFP).

Clause 1
The Chairperson then moved on to the Bill and began with Clause 1, which was moved for adoption and accepted.

Clause 3
Moving to Clause 3, Ms Smuts suggested that the words 'comply with the code of conduct of broadcasting services as prescribed by the IBA Act' be added to the clause. The Chairperson noted this submission but indicated that the committee will revert to the clause again.

Clause 4
Turning to Clause 4, Ms Smuts suggested an amendment which would read: 'subject to the provision of this Act a person may not provide a broadcasting service without a broadcasting licence'. The Chairperson indicated that he did not want to rephrase the entire clause.

Mr Markowitz (ICASA) indicated that a substitute for Clause 4 had been formulated and that all the parties had been consulted.

Mr Lekgoro suggested that it was difficult to come up with a position on this amendment while it was still unavailable to be read at that stage.

Mr Mahlatse (ANC) referred to Clause 4 and indicated that it was important to force the SABC to display South African talent. He suggested that the words 'The board must prepare and submit for licensing services within 3 months' should be added to this clause. He also suggested that the board must consider public policy and input in the development of policies as set out in Clause 5. The Chairperson indicated once again that this would be taken under consideration until copies of the documents were available.

Ms Smuts (DP) suggested an amendment to the ANC proposal.

Mr Lekgoro (ANC) indicated that he had no problem with this amendment in principle. However, he would want to examine it further.

Mr Mahlatse (ANC) indicated that this process should be very simple.

A Member (NNP) indicated that he wished to know exactly how the board would be required to consider public policy. Specifically he wished to know how the public would be able to make comments on the policies of the board.

The Chairperson echoed this question, asking for specificity as to the public consultation process.

Mr Abraham (UDM) supported the amendments but wished to know what 'national interest' was.

The State Law Advisors were asked to comment and Mr Kellner indicated that it was customary for the courts to interpret such phrases as 'public policy' and 'national interest'. To define them further was an exercise in futility since the concept was a moving target that needed to be approached on a case-by-case basis.

Mr Matlare (SABC) indicated that the board would develop the policies and then give them to ICASA. However he too wished to know exactly what 'publishing' would entail and precisely how this would be accomplished (obtaining comment from the public sector on the policies of the SABC).

The Chairperson indicated that the policies would have to be in line with the policy conditions as put forward by ICASA.

A Member (NNP) once again stressed the importance of public input. He put forward that ICASA does not equate with the public at all in spite of the fact that it is nominally a public body.

Ms Smuts suggested that constitutional principles should be differentiated from broadcasting principles. She also indicated that national interest was impossible to define, while public interest may be capable of a definition.

Clause 3
Clause 3(v) would be replaced by 3(a) from the Bill and 3(f) would be deleted. Clause 3 was then seen as acceptable.

Clause 4
Returning to Clause 4 it was suggested by the Chairperson that since the Department and the SABC had agreed on what should be in the clauses the entire Clause 4 should be deleted and the suggested amendment (please see document A [p.1]) should be substituted.

Mr Markowitz (ICASA) went on to number the clauses indicating that clause 1, 2 and 5 were acceptable. Clauses 3 and 4 would have to be amended as put forward in their submission.
It was further suggested that a definition of the word 'channels' would allow for conditions to be imposed on the policy.

The Chairperson suggested that the word 'conditions' should be considered in the light of the licensing conditions.

Clause 4 was deleted and replaced by the ICASA submission.

Clause 7
The Department representative indicated that the SABC would now be a juristic person. Referring to this the SABC suggested that the question of 'deeming' must be put in Clause 7(6) and 7(7) in order for there not to be a gap between when the SABC was a juristic person and when it was not. In short, if the SABC is retrospectively deemed to be a juristic person, then the acts that were made in the past should be deemed to have been made by the said juristic person. In this regard reference should be made to Clause 7(9)(d).

Clause 7(14) had been purposely amended to exclude 'rights and obligation', which were seen as unnecessary at that point.

The Chairperson suggested that the amendments as put forward by the SABC and the Department of Communications be adopted to replace Clause 7 and the entire Schedule 2. This was agreed to.

Clause 8
Clause 8 was seen as dealt with, as it was to be deleted.

Clause 9
Turning to Clause 9, the words 'spiritual enrichment' were to be deleted as the rest of the Bill dealt with this aspect.

Clause 10
Clause 10 was accepted.

Clause 11
Clause 11 was accepted.

Clause 11(3)(a) was amended to delete 'broadcasting'.

Clause 11 (3)(c) and Clause 11 (4) were deleted.

The SABC then put forward that there was duplication in the Bill especially in the aspect of financial reporting.

Ms Smuts (DP) was of the opinion that the financial requirements, as set out, do not have an effect on the journalistic freedom of the SABC, and that this had been taken from the Canadian Act. She indicated that she opposed Clause 11(5). It was, however, approved by the Committee in spite of this opposition.

Ms Smuts asked whether a set of two auditors as set out in Clause 11(5) was, strictly speaking, necessary. The Chairperson indicated that this would be considered and that it would not be signed off.

Clause 12
Clause 12 (2)(c) was accepted as being deleted.

Clause 13
Clause 13 was accepted.

Clause 14
Clause 14 (11) was seen as no longer applicable by the Committee and should be deleted.

It was suggested by the Chairperson that Clause 14(12), as suggested by the SABC/Department of Communications, should be inserted and this was accepted.

The State Law Advisors were asked whether this was a 'shall' Act or a 'must' Act. Since the original Act was a 'must' Act all references to 'shall' must be replaced with 'must'.

Clause 16
Clause 16 would be replaced with the proposal by the SABC/Department of Communications.

Clause 17
The Committee accepted Clause 17.

Clause 18
Turning to Clause 18, reference was made the SABC/Department proposal, which indicated that the words 'and the IBA Act' should be included. The Chairperson indicated then that this proposal would replace the current Clause 18.

As a general point it was put forward by the Chairperson that the words 'where the state is the sole shareholder' should be deleted wherever they could be found in the Act.

Clause 19
Clause 19 was accepted by the Committee.

Afternoon session
Clause 6
The Chair proposed that it would be best to delete the entire amendment to Section 6 of the Broadcasting Act of 1999 (the principal Act) in the Bill and replace it with a brand new formulation. In the ANC proposal (see document attached) the word "this" in its proposed Subclause 3 should be replaced with "its". The DP proposals (see document attached) suggests that "a" in Subclause 4 of the ANC proposal be deleted.

Ms Smuts (DP) asked whether there is any alternative formulation to the ANC's proposed "South African expression" in Subclause 4.

The Chair stated that this phrase was taken from the preamble to the principal Act itself.

Mr J Durandt (NNP) proposed "the much-loved ANC phrase" to "develop a South Africanness" as an alternative formulation.

The Chair stated that the current formulation would be retained, as amended by the DP proposal.

Ms Smuts recommended that her proposed amendment to Subclause 4(c) of the ANC proposal be effected.

The Chair noted that Members agreed to delete Subclause 4(c) in the ANC proposal and to replace it with the DP proposed amendment. The phrase "for approval" in the version of Subclause 5 proposed by the ANC will be deleted, and the formulation to be inserted after "policies" as proposed by the DP amendment will be inserted.

Mr Markowitz, advisor to the ICASA chairperson, stated that the problem here is that the ANC Subclause 5 provides "within three months", because ICASA might not be able to amend the SABC licence conditions within that period of time after the date of conversion. It would make sense if this matter were to be separated from the licencing procedure, and this does not have to be specifically included in the law because it is done anyway. The new licence conditions cannot be imposed because the new broadcast policies, with which the conditions have to accord, might not be finalised by then. This does not make sense.

The Chair stated that the amendment is not talking about licencing procedures, and was confident that this could be done within six months. The broadcast policies first have to be sorted out and then ICASA has to ensure alignment with the conditions.

Ms Smuts proposed that the three-month time period be deleted.

The Chair stated that a time frame is important because the SABC was requested to present their policies to Parliament during 2001, and they have now informed the Committee that they would be able to do so in November 2002. The reference to the "date of conversion" in this provision is not really important.

Mr Peter Matlare, SABC Group CEO, proposed that the provision state "three months after the SABC submits its broadcast policies to ICASA", as this process then flows logically.

Mr Solly Mokoetle, SABC Chief Operating Officer, added that the problem here would be that the SABC would have to prepare policies based on its old broadcast licence, because the new licence would not have been issued yet in the time period set out in the three-month period.

The Chair disagreed, because the policies would already have been done by the time the licence is up for renewal.

Mr Matlare proposed that the process occur "not later than three months after the date of conversion".

The Chair approved of this proposal.

Mr J Mjwara: Deputy Director-General, Department of Communications, stated that the DP proposal is problematic in that there may be provisions in the Bill that need to be reflected in the SABC policies, and the proposal does not allow for this.

Ms Smuts asked whether the ANC is of the view that these policies will be a once-off thing.

The Chair stated that this is an important point, because it has to be made clear that these policies will be reviewed regularly as part of a continuous process. The use of the date might not be truly reflective of this objective.

Mr Matlare suggested that it be linked to the passing of this Bill and not the date of conversion, so that the provision reads "within three months after the passing of this Act".

The Chair proposed that this be incorporated in a general clause.

Mr Mamarelane (ICASA) asked whether the Chair was saying that Mr Matlare's proposal would be included in a Subclause 1, and whether the ANC proposal would be contained in Subclause 2.

Mr Markowitz proposed that the provision state that "the Corporation shall notify the Authority in writing of any amendments or changes to the policies referred to in Subclause (1) as soon as is reasonably possible".

Ms C Mack, (MNET/Multichoice), stated that if this requires the SABC policies to be in line with the licence conditions, it would mean that ICASA could request the SABC to submit to them whenever any changes are effected to their policies so that new conditions might be devised.

The proposed that the Mr Matlare's proposal and the remainder of the ANC proposal be included as Subclause 5(1), and the formulation by Mr Markowitz would then become Subclause 5(2).

Mr Markowitz asked whether the provision refers to the date of conversion or the date on which the Act comes into operation.

The Chair informed Mr Markowitz that it is the former, and noted that the DP amendment seeks to amend the ANC version of Clause 6(6) by proposing the deletion of "fairness".

Ms Smuts suggested that the phrase "and equitable treatment of all segments of the South African population" in the ANC proposal be deleted, as it is unnecessary because Section 9 of the Constitution already enshrines this principle.

The Chair stated that that phrase should be included because it seeks to accommodate gender, race, ethnicity etc, and is worth mentioning in this Bill.

Ms Smuts maintained that it is superfluous because it is already guaranteed in the Constitution.

The Chair stated that the phrase would be retained, and called for the deletion of the phrase as requested by Ms Smuts.

Ms Smuts suggested that the provision simply read "The constitutional principles of equality and equitable treatment".

The Chair proposed that it read "the equitable treatment", and noted that Members agreed to this amendment. He suggested that the proposed Subclause 6(ii) in the DP amendment read "of all official languages, and not "of the official languages".

Ms Smuts stated that the DP amendment provides a better reflection of the language clause in the Constitution.

The Chair noted that Members agreed to the DP amendment to the ANC's proposed Subclause 6(ii), and Members also agreed to the inclusion of the word "fairness" in the ANC's proposed Subclause 6(v) as proposed by the DP amendment.

Mr A Maziya (ANC) agreed with the amendments effected, but expressed concern with the fact that the formulation does not provide a formula for gauging whether the community is satisfied with the services delivered by the SABC. It therefore has to be formulated in a way that ensures public participation.

The Chair agreed, as this is an important concern. A new Subclause 6 should be inserted to reflect this.

Mr Matlare proposed that it read "The Board must ensure public participation in the development of the policy referred to in Subclause (5)".

Ms Jane Duncan, from the Freedom of Expression Institute (FXI), contended that this formulation is not sufficient because, although the ANC proposal that the public be consulted in the policies of the SABC is welcomed, it nevertheless takes away much State accountability, and does not replace it with public accountability. The FXI submits that a positive obligation be placed on the SABC Board to ensure ongoing review of its policies and practical matters, so that public access to the Board is ensured.

Mr Durandt stated that the NNP supports this proposal, because prior to 1994 the SABC failed to abide by its objectives and failed to keep its promises as far as delivering in terms of its public mandate is concerned.

Mr Maziya stated that a forum for public discussion is needed here to enable the public to propose their views to the Board.

The Chair stated that something similar to sentiments encapsulated in the FXI formulation is needed here (Appendix 6) but its formulation is too long, and needs to be condensed into one line.

Ms Smuts suggested that the crux of the FXI submission on this matter is contained in the proposed Clause 6(4)(d) of their document. This states "the Corporation shall provide suitable and sufficient means for the representation to the Corporation of public opinion on its services, and for consideration within the Corporation of criticism and suggestions so represented". The provision should also state that "the Corporation must provide sustainable means for the representation of public opinion on its services and to ensure that such public opinion is given due consideration".

Ms Duncan stated that the provision has to enshrine the principle of constant and effective review as part of an ongoing process, and has to ensure that it is not merely a periodic occurrence.

Ms Smuts proposed that the word "regular" then be inserted before "representation" in the second formulation she proposed above.

Mr Matlare informed Members that nothing currently prevents the public from commenting on the SABC services, and the SABC does in fact receive comments in the wider community level. All these comments and concerns are taken account of, and there is nothing that has been proposed today that does not amount to the measures presently being taken by the SABC in this regard.

The Chair informed Mr Matlare that the SABC would assisting matters if it were to propose concrete formulations, and not abstract policy statements.

Mr Maziya proposed that the Subclause 7 proposed by the DP amendment instead provide "the SABC's broadcasting programmes must advance the national and public interest" because, in the ANC's view, these two interests are distinct and the one cannot replace the other.

The Chair stated that Members must not enter into a debate on this matter because they will not reach consensus. The definition of the term "national interest" should be deleted, so that the matter remains as open-ended as it should be. In fact, other Commonwealth jurisdictions grant the power to decide this matter to the Minister of Communications (the Minister), yet South Africa seems to adopt the "soft approach" and leaves it to SABC to decide.

Mr Mokoetle suggested that the inclusion of "national interest" in the proposed Subclause 6(v) is problematic.

Mr Maziya agreed as the amendment does seem to confuse matters.

The Chair stated that the proposed Subclause 6 deals with the Code of Practice, and rightfully belongs under Subclause 4(d) if the SABC does not want it to be a stand-alone clause, and it would then read "advance the national and public interest". If it were included in the Code of Practice it is unclear how precisely the SABC would ensure that its employees "advance the national and public interest", and thus this formulation makes matters too difficult. The preferred option would therefore be to include it in the general Subclause 4(d) that deals with the SABC policy as a whole. There are thus three distinct options here: it could either be placed in Subclause 6(v), it could be incorporated in a stand-alone clause or it can be included in a new proposed Subclause 4(d).

Mr Maziya stated that he was under the impression that it would be incorporated in a new Subclause 7 as a stand-alone clause, as this seems to be the correct approach.

The Chair stated that the SABC is suggesting that it simply be included in Subclause 6(v). It cannot be contained in a stand-alone clause.

Mr Mjware suggested that it would be problematic if it were placed elsewhere if it is linked to news etc, and the Department would prefer it to be included in Subclause 6(v) instead of being a stand-alone clause.

The Chair stated that there is merit in the argument put forward by the Department, but it has to be placed under Subclause 4(d), and noted that Members agreed.

Clause 21
The Chair referred Members to the SABC's proposed reworking of this clause (Appendix 2).

Mr Mjwara contended that the "must" in Subclause 6(f) in the Bill be replaced with "may".

The Chair noted that the SABC proposal seeks to delete Subclause 6(f) of the Bill.

Ms Smuts contended that the aim here is to include a "reasonable exception" to ensure that the SABC does not use the revenue generated from licence fees to other expenses, such as administrative costs. This provision should thus properly state "must be allocated to programming and not on administration costs", so that there is no longer a need to involve the Minister's policy directives here. The concern here is that the current version of this clause, by allowing the Minister to "issue policy directives on the use of television licence fees", does allow the SABC to be used as a mouthpiece of government to express its view on a specific subject by influencing the items on which the SABC's spends its revenue.

The Chair stated that he never understood why the SABC has never decided to establish a call centre to deal with television licence queries, as such centres would not only improve the SABC's public relations but would also assist it significantly in collecting licence fees.

Mr Matlare replied that this has been done, and 22 different people are involved here.

Mr Maziya contended that the penalties provided in Subclause 3 of the Bill impose the same sanctions equally both on dealers and ordinary persons who contravene this clause. The problem here is that the dealer, whose aim in contravening this provision is to make a profit, if penalised to the same extent as an ordinary person who might not have the funds to pay the licence fee. This has to be resolved.

Ms Pipa Rayburn, the SABC Legal Advisor, replied that the penalty contained in the bill stipulates that the dealer would have to pay per set sold, whereas the ordinary person can pay a maximum penalty of double the amount of the licence fee. The Bill does therefore impose different sanctions on dealers and ordinary persons. The exemptions that may be issued under this clause will be governed by regulations.

Mr Maziya stated that the exemptions to be imposed are a serious matter.

The Chair stated that a concrete formulation is needed here. Would the Minister or ICASA issue the regulations referred to in the phrase "unless exempted by regulation" contained in the SABC's proposed Section 27(1)(b)(i).

A State Law Advisor replied that the Minister would issue these regulations, via Clause 28.

Ms Rayburn proposed that Clause 28 be amended to specifically provide for the Minister to issue such regulations.

Ms Matthews, DEAFSA, recommended that the fine to be imposed on dealers such as Teljoy should be proportional to the amount of money they make by evading the law.

The Chair explained that Subclause 5(b) of the SABC proposal provides that the person would have to pay "a fine not exceeding R500" in relation to "each television set in respect of which the offence is committed", and this therefore makes it clear that those selling illegal television sets have to pay more. This then covers the concern raised by Mr Maziya.

Ms Smuts stated that she agrees with Mr Maziya that the Bill does impose an appropriate sanction on the dealers.

The Chair disagreed and contended that the provision adequately deals with those dealers who do not ask clients for proof of their television licence.

Mr Mokoetle stated that the SABC's proposed Subclause 8 draws a distinction between the "administration" and "functions" of the SABC.

Mr Mjwara stated that, as a rule, public fees are not used for administrative matters, and a structure is needed to encapsulate this.

The Chair stated that Subclause 6(b)(f) in the Bill has to be deleted and replaced with the SABC's proposed Subclause 8.

Clause 23
Mr Markowitz suggested that the ICASA proposed amendment to Section 30 of the principal Act (Appendix 3) be effected, as this reinforces that fact that subscription broadcasting services will be made subject to the regulations determined by ICASA.

The Chair asked for clarity on the meaning of the term "diversity" in Subclause 8(b) of the ICASA proposed amendment.

Mr Markowitz replied that this is aimed at ensuring that a situation in which twenty sports channels, for example, are not broadcast on one subscription service.

Ms Smuts stated that she does not see the problem with this if this is what the market wants.

Mr Kwesi Mtengwenia, from MNET/Multichoice, stated that Subclause 8(b) in the Bill does create problems as is causes confusion. The version proposed by ICASA grants it the power to look at a variety of issues in this regard but these powers are too widely framed, and ICASA's version should thus be deleted.

Ms Mack added that the ICASA proposal could actually function as an inhibitor to anyone who might wish to enter into the subscription broadcast market because, as illustrated by the following example. Should Orlando Pirates Football Club for example decide to set up a three channel bouquet, each channel devoted to local and international football, the ICASA proposal would require Orlando Pirates Football Club to include "South African television and music content" in its bouquet which is aimed exclusively at football coverage. This then makes it harder for those wishing to enter this market to provide this diversity on their own, and they would then have to approach an established subscription service provider that currently offers this diversity for assistance, such as Multichoice.

Mr Markowitz stated that ICASA is prepared to drop the proposed Subclause 8(b) because it does seem to be a bit vague and in need of tightening up.

An additional problem is created by the fact that sport is not considered "local content".

Mr Markowitz contended that the incorporation of the word "include" in ICASA's proposed Subclause 8(a) could be replaced with "contribute to", so that the broadcaster could be made to contribute funds towards "South African television and music content" even though it is not actually providing this content.

The Chair agreed.

Clause 24
Ms Smuts proposed that Clause 31 as it currently stands in the Bill be deleted in its entirety, as ICASA has to be allowed to complete its inquiry into the feasibility of the provision of additional subscription television services. This provision should thus remain as is presently provided in the principal Act.

Mr Mjware suggested that ICASA should not perform all the oversight functions with regard to all the SABC's policies, as they should also be brought before Parliament.

Mr Markowitz replied that Section 49(7) of the IBA Act confers general powers on ICASA to conduct this inquiry "whenever [ICASA] deems necessary", and Section 50(6) of the principal Act confers that same power to ICASA. It has to be remembered that ICASA will not be making policy decisions by itself, but would merely be conducting an inquiry into the SABC policy and submit its findings to Parliament for decision.

Ms Mack stated that the question here is why the decision-making powers of the National Assembly have now been conferred on the Minister.

* The minutes of the remainder of this meeting will be available on 21/10.

Appendix 1

Further DA Amendment to ANC proposal

CLAUSE 6

1. In Subclause 4, to delete the word "a" before South Africa.

2. In Subclause 4(c), to state "offer a plurality of views and a variety of news information and analysis from a South African point of view".

3. In Subclause 5, after the word "policies", to insert:

"that will ensure compliance with the Authority's Code of Conduct as prescribed in terms of Section 56(1) of the IBA Act and with the licence conditions imposed on matters including:"
 

4.. In Subclause 6(i), to delete "fairness".

5. In Subclause 6(ii), to replace "and" with "of"

6. In Subclause 6(ii), to replace "all South African" with "the".

7. Subclause 6(iii) to remain as is.

8. Subclause 6(iv) to remain as is.

9. In Subclause 6(v), to insert "and fairness" after "impartiality".

10. To insert Subclause 7 to read "The SABC's broadcasting programs must advance the public interest", and to delete "the national interest".

Appendix 2

D o C and SABC's PROPOSED AMENDMENT TO SECTION 7 OF THE ACT (Clauses 8 and 29)

7. (1) The old Corporation is, with effect from a date determined by the Minister by notice in the Gazette, which may be a date prior to the commencement of this Act, deemed to be a public company incorporated in terms of the Companies Act, to be known as the South African Broadcasting Corporation Limited.

(2) The Corporation must have a share capital as contemplated in section 19 of the Companies Act with the State as its sole shareholder with effect from the date of conversion referred to in subsection (1).

(3) The Minister must determine the memorandum and articles of association of the Corporation and must submit these to the Registrar at least a week prior to the date of the notice contemplated in subsection (1).

(4) The Registrar must, on the date of the notice contemplated in subsection (1), register the memorandum and the articles of association of the Corporation in terms of section 63(1) of the Companies Act and issue a certificate of incorporation and a certificate to commence business to the Corporation, but no fees are payable in respect of such registration or issue.

(5) With effect from the date of conversion the provisions of the Companies Act shall apply to the Corporation as if it had been incorporated in terms of the Companies Act on that date, save to the extent stipulated in this Act.

(6) Sections 32, 44, 54(2), 60, 63(2), 64, 65 and 172 of the Companies Act do not apply to the Corporation.

(7) Sections 66, 190 and 344(b) and (d) of the Companies Act do not apply to the Corporation.

(8) All references in this Act to the conversion of the old Corporation must be construed as references to the conversion of the old Corporation into a public company having a share capital and having been incorporated in terms of the Companies Act as stipulated in subsection (2).

(9) Neither the repeal of the Broadcasting Act, 1976 (Act No. 73 of 1976), nor the conversion of the old Corporation affects-

(a) the continued corporate existence of the old Corporation with separate legal personality as from the date of its first establishment;

(b) any of the rights, assets, liabilities or obligations acquired or incurred by the old Corporation or on behalf of the old Corporation at any time before its conversion;

(c) the terms and conditions of service and accrued benefits of its employees; or

(d) the validity of any act lawfully performed by or on behalf of the old Corporation prior to the date of conversion.

(10) With effect from the date of conversion,

(a) any reference to the old Corporation in any contract, statute, licence or other written instrument shall be deemed to be a reference to the Corporation;

(b) (i) any reference to the old Corporation in the patents register, trade marks register, design register, deeds register or any other register in the Republic is with effect from the date of conversion, deemed to be a reference to the Corporation;

(ii) the relevant registrar must make such entries or endorsements in any register referred to in paragraph (i) or other documents in the registrar's office or submitted to the registrar as are necessary to give effect to the conversion;

(iii) no fees or other levies are payable in respect of such entries or endorsements.

(11) Any legal proceedings instituted by or against the old Corporation prior to the date of conversion may, notwithstanding such conversion, be proceeded with by or against the Corporation subject to the law governing the prescription of claims.

(12) (a) The Minister of Finance, after consultation with the Minister, must determine the tax values of the assets owned by the Corporation as at the date of conversion for the purpose of calculating any wear and tear or capital allowance or any deduction as contemplated in the Income Tax Act, 1962 (Act No. 58 of 1962).

(b) The assets contemplated in paragraph (a) are for the purposes of sections 11(e), 12C, and 13 of the Income Tax Act, 1962 (Act No. 58 of 1962), deemed to have been brought into use for the first time at a cost equal to the value determined in terms of paragraph (a).

(13) (a) The old Corporation shall before the date of conversion conduct a legal and financial due diligence investigation into the state of its affairs for the purposes of identifying and establishing the status of all its assets, rights, obligations and liabilities.

(b) The old Corporation must submit to the Minister, by not later than three months prior to the date of conversion, a legal and a financial due diligence report containing details of all of such assets, rights, obligations and liabilities and the implications of the contracts concluded by or on behalf of the old Corporation in respect of such assets, rights, obligations and liabilities.

(14)The old Corporation must, after submitting the due diligence report to the Minister and before the date of conversion,

(a) prepare and submit to the Minister an inventory of all its assets and liabilities; and

(b) provide the Minister with details of its financial policies relating to the allocation of such assets and liabilities between the public broadcasting service division, the commercial broadcasting service division and the shared group services of the Corporation.

(c) provide the Minister with details of its financial policies governing internal transfer pricing between the public broadcasting service division, the commercial broadcasting service division and the shared group services of the Corporation

(15) The Minister must submit a copy of the inventory referred to in subsection 14(a) to the National Treasury and the Auditor-General.

(16) (a) Any use by the public broadcasting service division or the commercial broadcasting service division of any asset allocated to another division of the Corporation must be accounted for in the respective financial records of the public broadcasting service division and commercial broadcasting service division to ensure that such use took place on an arms length commercial basis.

(b) Any service rendered by or to the public broadcasting service division or the commercial broadcasting service division to or by another division of the Corporation must be accounted for in the respective financial records of the public broadcasting service division and commercial broadcasting service division to ensure that such service was rendered on an arms length commercial basis.

SABC'S PROPOSAL FOR AMENDMENT TO SECTION 13 OF ACT (CLAUSES 14 AND 15 OF THE BILL) :

13.   Members of Board.—(1)  The twelve non-executive members of the Board must be appointed by the President on the advice of the National Assembly.
(2)  The non-executive members of the Board must be appointed in a manner ensuring—
(a) participation by the public in a nomination process;
(b) transparency and openness; and
(c) that a shortlist of candidates for appointment is published, taking into account the objects and principles of this Act.
(3)  The President must designate one of the members of the Board referred to in subsection (2) as the chairperson and another member as a deputy chairperson, both of whom must be non-executive members of the Board.
(4)  The members of the Board must, when viewed collectively—
(a) be persons who are suited to serve on the Board by virtue of their qualifications, expertise and experience in the fields of broadcasting policy and technology, broadcasting regulation, media law, frequency planning, business practice and finance, marketing, journalism, entertainment and education, social and labour issues;
(b) be persons who are committed to fairness, freedom of expression, the right of the public to be informed, and openness and accountability on the part of those holding public office;
(c) represent a broad cross-section of the population of the Republic;
(d) be persons who are committed to the objects and principles as enunciated in the Charter of the Corporation.
(5)  The members of the Board must hold office for such period as the President may determine which period must not exceed five years.
(6)  The deputy chairperson referred to in subsection (3) must, when the chairperson is absent or unable to perform his or her duties, act in his or her stead and when so acting, exercise or perform any function of the chairperson.
(7)  Every appointment of a member of the Board must be published in the Gazette.
(8)  A member of the Board appointed to fill a casual vacancy must hold office for the unexpired portion of the period for which the vacating member was appointed.
(9)  The Board of the old Corporation as constituted on the date of conversion constitutes the first Board of the Corporation.
(10)  Nine members of the Board, which must include the chairperson or the deputy chairperson, will constitute a quorum at any meeting of the Board.
(11)  The Board controls the affairs and determines the overall policies of the Corporation and must protect matters referred to in section 6(2) of this Act.
(12) The Board --

(a) shall establish a public broadcasting service sub-committee and a commercial broadcasting service sub-committee -

(i) to report to the Board on a six-monthly basis on the extent to which the public broadcasting service division and the commercial broadcasting service division have achieved their objectives during the relevant period, and

(ii)to perform such other functions regarding the organisation of the Corporation into the public broadcasting service division and the commercial broadcasting service division respectively, as may be delegated to them by the Board; and

(b) may establish such other sub-committees as it deems appropriate from time to time.


14. Executive committee.—(1)  The affairs of the Corporation are administered by an executive committee consisting of the Group Chief Executive Officer and no more than fourteen other members appointed by the Board.
(2)  The executive committee is accountable to the Board.
(3)  The executive committee will perform such functions as determined by the Board.


Proposal of D o C, ICASA and SABC for amended s 22 of the Act

22. Amendment of broadcasting licences.¾ (1) The Corporation must, within six months of the date of commencement of the Broadcasting Amendment Act, 2002 or the conversion date, whichever is the later, apply to the Authority for such amendments to its existing broadcasting licences as are necessary in order to reflect the organisation of the Corporation into the public broadcasting service division and the commercial broadcasting service division and its related obligations in terms of this Act.
(2) The relevant provisions of the IBA Act apply mutatis mutandis to the applications referred to in subsection (1) provided that, irrespective of the contents of the application of the Corporation, the Authority may impose any appropriate licence conditions which are necessary in order to reflect the organisation of the Corporation into the public broadcasting service division and the commercial broadcasting service division and its related obligations in terms of this Act.


SABC's proposed section 27 of the Act (Clause 21 of the Bill):

27.   Television licences.—(1)  (a) No person may use any television set unless such person is in possession of-
(i) a television licence issued by the Corporation against payment of the prescribed fee for each television set so used, unless exempted by regulation; or
(ii) a written exemption pursuant to the regulations; or
(iii) written confirmation, issued by the lessor of the television set in question that such person is a person to whom that television set has been rented, or otherwise made available in accordance with this Act.
(b) No business, dealer or lessor may use any television set unless-
(i) such business, dealer or lessor is in possession of a television licence issued against payment of a prescribed fee in terms of this Act for each television set so used, unless exempted by regulation;
(ii) such television set is used in accordance with such licence; and
(iii) such business, dealer or lessor is able to produce such licence on demand.
(c) A user who is required to be in possession of a television licence must possess all the categories of television licences as prescribed, which pertain to such use.
(2) Subsection (1) does not apply to a person who manufactures or repairs television sets, or who acts in the execution of his or her duties in the service of such a person, in so far as he or she uses any television set manufactured or repaired by him or her, in or on the premises where it was manufactured or repaired or on any other premises approved by the Corporation, for the purposes of testing such a television set.
(3) Any person who contravenes subsection (1) shall, in addition to payment of the prescribed licence fee, be liable-
(a) to pay to the Corporation by way of a penalty an amount equal to double the amount of the applicable prescribed licence fee; or
(b) in the event of a user proving that he or she had used the television set for a period of less than one year, to pay to the Corporation, by way of a penalty, in respect of every month or part of a month during which such a person had failed to take out such television licence, an amount equal to 10% of the applicable prescribed television licence fee: Provided that the total amount of the penalty may not exceed the amount of such television licence fee, unless otherwise prescribed.
(4) A dealer who sells or alienates a television set to a person who is not in possession of a television licence and who is not exempted from the obligation to be in possession of a television licence, shall be liable to pay the penalty contemplated in subsection (3) in respect of each television set sold or alienated to such person.
(5) Notwithstanding subsections (3) and (4), any person who-
(a) contravenes or fails to comply with any provision of this section or any regulations pertaining to television licence matters; or
(b) after an authorised inspector, referred to in subsection (6), has produced his or her written authority to such person fails, without good reason, to comply with any lawful demand made by that authorised inspector,
is guilty of an offence in relation to each television set in respect of which the offence is committed and shall be liable upon conviction to a fine not exceeding R500 in relation to each such offence or to imprisonment for a period not exceeding six months or to both such fine and such imprisonment.
(6) (a) The Corporation may appoint any person as an authorised inspector.
(b) An authorised inspector may-
(i) require a person who is required in terms of subsection (1) to be in possession of a television licence to produce such television licence for inspection;
(ii) require a person who uses a television set, or a person who is the owner or occupier of any premises on which a television set is used, to produce such television set for examination, in order to determine whether the provisions of this Act have been complied with;
(iii) require a person who uses a television set to furnish his or her identity document or licence registration number, whichever is applicable;
(iv) require a person who uses a television set, or a person who is the owner or occupier of any premises on which a television set is used, to furnish such information as may be prescribed or necessary in order to determine whether the provisions of this Act have been complied with;
(v) require a business, dealer or lessor to produce records relating to transactions involving television sets for inspection, and make extracts therefrom or copies thereof;
(vi) enter upon any land, in so far as this may be necessary, in order to exercise a power conferred on him or her by the provisions of this Act: Provided that entry may not be gained to a residence after dark without a warrant or the occupier's permission.
(7) A television licence is not, save as may be prescribed, transferable.
(8) All television licence fees collected by the Corporation must be used by the Corporation solely for the public broadcasting service to be provided by the Corporation as stipulated in section 10(1)(e) of this Act, and all related administration and functions.
(9) To enable the Corporation to establish and maintain a national database register listing all sales of new television sets in the Republic; dealers, lessors and businesses shall provide the Corporation with all information prescribed in respect of sales of new television sets.


ICASA and SABC's PROPOSAL TO REPLACE CLAUSE 26 OF THE BILL

Section 32A

(1) Subject to subsection (2), in the performance of its public broadcasting service mandate under section 10(1)(a) and (b) of this Act, the Corporation shall apply to the Authority under section 41(4) of the IBA Act read with section 45(2) of that Act to license it to provide at least two additional television channels which will broadcast

(a) regionally,

(b) in such official languages as are appropriate having regard to language usage within the respective regions served by the channels in question, and

(c) so as to ensure that between the channels broadcast services are provided on an equitable basis in Setswana, Sesotho, Sepedi, Xitsonga, TshiVenda, isiXhosa, isiZulu, siSwati, Afrikaans and Ndebele

(2) The Corporation shall make the application contemplated by subsection (1) as soon as it is satisfied that sufficient public funds will be made available to establish the channels in question and to sustain them on an ongoing basis.


SABC's proposal for Clause 31 of the Bill

Short title and commencement.-(1) This Act is called the Broadcasting Amendment Act, 2002, and comes into operation on a date determined by the President by proclamation in the Gazette.
(2) Different dates may be fixed for the coming into operation of different sections of this Act by proclamation in the Gazette, which dates may, in respect of particular section of the Act, be prior to the date of publication of this Act in the Gazette.

D o C AND SABC's proposed section 14 of the Act (Clause 16 of the Bill):
 

Appendix 3

Definitions - Amendment of Section 1 of Act 4 of 1999

(l) by the substitution of "free-to-air service" of the following definition

"free-to-air service" means a service which is broadcast [without encryption] and capable of being received without payment of a subscription fee by the end user to the broadcaster [and without the use of receiving equipment].

(o) by the substitution of the definition of "licensee" of the following definition:

"licensee means the holder of any licence granted and issued under [this Act] the IBA Act or deemed by this Act or the IBA Act to have been so granted or so issued.

(a) by the amendment of section 3(5)(f) as follows:

(5)(f) comply with the code of conduct for broadcasting services as prescribed in terms of