Businesses Act Review
Consumer & Corporate Regulation
Division – the dti
Presentors:MacDonald Netshitenzhe (Chief Director:Policy& Legislation)
:Baneka Dalasile (Director: Legal Support)
:Tshifhiwa Mavhuthugu (Director: Legislative Drafting)
:Lonwabo Sopela (Deputy Director: Legislative Drafting)
Purpose of Act
The purpose of the Act is to:
• promote the right to freedom of trade, occupation and profession and any
rights contained in the Constitution;
• promote the development of South African economy by providing a
standardised regulatory framework within which business licencing would take
place;
• to encourage a conducive environment that promotes compliance and
sustainability of businesses;
• set essential norms and standards applicable nationally, provincially and in
municipalities relating to licensing of businesses.
Application of the Bill
•
•
any natural or juristic person or seeks to or carrying on business within the
Republic.
Licensing authority may in consultation with
–
–
–
Minister of Trade and Industry
Minister of Cogta
Relevant MEC
exempt categories of persons or applications for licenses from one or more of the
provisions of the Act, Provincial legislation or a by law.
• Publication of such application for exemption for a period of not less than 30
days in a gazette for public comments.
Summary of the Bill
•
The Bill seeks to provide:
– a simple and enabling framework for procedures for application of
business licences by setting national norms and standards ;
– framework for co-operative governance and harmonisation of
standard procedures and minimum requirements for application of
business licences ;
– framework for support monitoring and standard setting by national
government in order to build local government into an efficient,
frontline agency capable of integrating the activities of all spheres
government for the overall social and economic upliftment of
communities in harmony with their local natural environment ;
…….Summary of the Bill
– to provide for the appointment of inspectors; to provide for framework
of penalties and administrative fines for non- compliance;
– to repeal the Businesses Act, 1991 and all proclamations, notices,
regulations promulgated under that law; and
– to provide for matters connected therewith.
Licensing authority
•
•
•
Is any local municipality or Metropolitan municipality as defined in
Municipal Structures Act (Act no 117 of 1998)
Licensing authority to keep an up to date central registry
Compile and submit to MEC a consolidated report of all licensed
businesses and any other prescribed information.
General interpretation of the Act
•
If there is an inconsistency between any provision of this Act and a
provision of any other national or provincial legislation, or municipal bylaw– the provisions of both Acts apply concurrently, to the extent that it is
possible to apply and comply with one of the inconsistent provisions
without contravening the other; and
– to the extent it is impossible to apply or comply with one of the
inconsistent provisions without contravening the provisions of the
second, the provisions of this Act shall prevail.
Application of licenses
South African citizen
Foreigners
• Relevant licensing authority
• Relevant licensing authority
• Prescribed manner and form
• Prescribed manner and form
• Comply with the Act, Provincial
• Comply with the Act, Provincial
legislations and by laws
legislations and by laws
• Payment of prescribed fee
• Payment of prescribed fee
Valid business permit ( Immigration
Act, 2002)
Any other documentation required to
verify the status of such a foreigner
(Immigration Act and refugees Act)
Licensing process
Decision within
30 days
Issue Licence
Request
additional
documents
No action after
14 days by
applicant
Deemed
abandonment of
application
Documents
received
Issuing of
licence
Reject
application
Appeal to ADR
structure
Request
extension
Reject
application
No action after
30 days and
extension period
by authority
Appeal to ADR
structure
Deemed issuing
of licence
A license
•
•
•
•
•
Valid for 5 years
To be renewed three months before the expiry date
Upon death or incapacity of license holder, the administrator may continue to
conduct licensed activities in the name of the estate, or make an application
to transfer the license to another person.
License can be amended by the licensing authority (in the public interest/
license holder to be informed) (s22)
License can be amended on application by the license holder (s23)
Automatic revocation
•
•
•
•
•
•
•
•
Consistent failure to comply with compliance notices (without plausible
explanation)
Disqualified in terms of section 24 of the Bill
Guilty of selling counterfeit goods
Guilty of contravening Customs and Excise Duty Act
Guilty of contravening Foodstuffs, Cosmetics, and disinfectants Act
Guilty of employing illegal foreigners
Contravening immigration Act, refugees Act or any related legislation in the
Republic.
Guilty of conducting illegal business from licensed premises
Fronting and prohibitions
•
•
•
•
•
•
•
Fronting is not allowed (s19)
Contravention of licence conditions, related legislation and bye laws is
prohibited
Failure to produce license when requested to do so
Obstructing, interfering and hindering an inspector while performing his duty
Refusing to provide an inspector with the document or information required
Falsifying, altering a licence or compliance notice
Providing false information, or misleading forged document
Penalty
•
•
•
Fronting(s19) and prohibitions (s25) carry a penalty of a fine, or
Imprisonment for a period not exceeding 10 years, or
Both a fine and imprisonment
Enforcement
•
•
There will be inspectors and Accredited Community Based
Organisations that will assist the licensing authorities in monitoring the
enforcement of the legislation.
The inspectors have the powers to:
– Conduct inspections, monitor and enforce compliance
– Investigate complaints
– remove and confiscate goods
– issue fines
– issue compliance notice
– close a business or premises pending further investigation
– Enter premises, request a document and question anyone
14
Inspectors
•
•
•
•
•
•
•
Suitable person appointed by the Licensing authority
Person designated by the Minister
Any member of SAPS
Commissioner or any officer for Customs and Excise
Traffic officer
Any person appointed under section 10 of foodstuffs, Cosmetics, and
Disinfectants Act
Peace officer contemplated in section 334 of Criminal Procedure Act
15
Transitional arrangements
•
•
•
Any application for a licence or matter received by a licencing authority
under the Business Act,1991,before the date of commencement of this
Act and not disposed of prior to the date of commencement of this Act,
must be disposed of by that authority in terms of that Act despite its
repeal.
A licence issued under 1991 Act and all compliances notices or fines
remains valid until it expires, thereafter it shall be renewed in terms of
this Act unless revoked by the licensing authority.
A Licence holder must convert a licence issued under the Business Act,
1991, into a licence issued under this Act, may do so within twelve (12)
months from the commencement date of this Act.
16
Progress status
•
The Bill was published for comments for 30 days ( 18 March to 18 April
2013), extended until 30/04/2013
• Analysis of comments from Public has commenced
- Many comments are in support but worried problems relating to
implementation e.g. lack of capacity
- DHA officials are of the view that foreigners whose status is not yet
confirmed (6months) should not be granted licenses
- DHA also requests that the provisions of the Bill be aligned to the provisions
of Immigration and Refugees Act
- CogTA is of the view that security matters should be provided for in the
object/Purpose of the Act
• No decision has been taken in support or not on the comments internally
17
What is likely to happen when the Bill is passed? impact
•
•
The Bill will foster:
- smooth implementation of harmonised norms and standards in
implementation
- certainty in doing business in all tiers of government
- building of capacity relating to enforcement of the Act
The Bill with its Regulations will prescribe costs that are very minimal
throughout the country.
18
Conclusion
•
•
•
•
•
The Business Act, 1991 is in existence as for now before this Bill comes into
operation.
Its implementation throughout the country is not uniform
No capacity for implementation is built
This Bill seeks to harmonise certain minimum standards in the implementation
in order to foster cooperative implementation throughout all three tiers of
government.
It is not the intention of this Bill to introduce regulatory burden eg prescribed
costs will be minimal
19
THANK YOU
20