Mr Chairman, in the absence of the hon member for Vasco, who has apologized for being unable to be here, I move the amendment printed in his name on the Order Paper, as follows:

1. 1. In the English text, on page 5, in line 30, after “determined” to insert “from time to time”.

Mr Chairman, as I indicated during the Second Reading debate, I am happy to accept the amendment of the hon member for Vasco, as moved by the hon member for Innes dal.

Amendment 1 agreed to.

Clause, as amended, agreed to.

Clause 5:

Mr Chairman, there is just one point I should like the hon the Deputy Minister to clarify. It is a point already raised during the Second Reading debate. Clause 5, which seeks to insert in the principal Act after section 8A, a new section 8B, deals with the disciplinary committees and with the right of an aggrieved person firstly to obtain reasons for actions taken by such disciplinary committees, and secondly, to give notice of an appeal against decisions taken by such disciplinary committees.

The proposed new section 8B(6) states that any person who feels aggrieved by any decision taken by a disciplinary committee has one month within which he can ask for reasons and one month within which he can lodge an appeal. I think that is what is actually meant but I should just like the hon the Deputy Minister to clarify it completely.

Mr Chairman, according to the interpretation by the hon member for Hillbrow of the proposed new section 8B(6) provision is only made for an appeal to the board against a decision of a disciplinary committee. A time-limit within which such appeal should be lodged, however, is not prescribed. That is how I understood the hon member also during Second Reading. As I read it, it clearly states that within a period of one month a person who feels himself aggrieved may request reasons for the disciplinary committee’s decision. As contemplated in paragraph (a) this equally applies to the period within which an appeal as contemplated in paragraph (b) could be lodged. The reason for this is that the introductory paragraph to subsection (6) qualifies both paragraphs (a) and (b). If the proposed new section is read in its proper context there could be no doubt about its meaning. This matter has also been confirmed by the State Law Advisers responsible for the technical revision of this Bill.

Clause agreed to.

Clause 6:

Mr Chairman, I have an amendment printed on the Order Paper, which I am not going to move. When this clause was discussed during Second Reading we had a problem in respect of the fact that reference is only made to “attorney and client costs”. As hon members should well know, “attorney and client costs” presupposes a special scale of fees laid down by a taxing master, and also a special order issued by a court of law in respect of one or more of the vexed parties. I do not know whether it is the intention in this instance to cover the more onerous costs resulting from a court hearing. This only comes about when the board has been obliged to take action against an estate agent if the estate agent has not complied with the obligations placed upon him. Therefore, to enforce that order the matter has to go to court for a civil hearing. At the end of that civil hearing the court issues an order. Normally that order, unless it is a vexatious matter, provides for “attorney and client costs”. Those are the costs which, I believe, should be recovered.

In both amendments appearing in my name on the Order Paper I ask for “attorney and client costs” to be substituted by “legal costs”. The hon the Deputy Minister, however, wants to know from me what legal costs are. I have consulted two legal dictionaries on this question and have come to the conclusion that “legal charges” will actually be the correct term to use. Bearing that in mind, I therefore move the following amendments:

1. 1. On page 7, from line 38, to omit “attorney and client costs” and to substitute “legal charges”.
2. 2. On page 7, in line 45, to omit “attorney and client costs” and to substitute “legal charges”.

By moving these amendments the board will be enabled to recover the legal charges that may be incurred. That is what, I believe, is intended here. In this respect I should refer the hon the Deputy Minister to page 7, in line 43, where we read the following:

This is in other words the taxed amount of such “legal charges”, and since “legal charges” seems to be the correct term to use, I move my amendments in order to effect such substitutions.

Mr Chairman, I think we have to assume that when the board has incurred, or has had to incur, costs of this nature, they would under the circumstances, be reasonable costs. I do not think the board would incur unnecessary costs. It is, after all, owing to the non-compliance or anomalous acts on the part of the relevant estate agent that the board is obliged to incur such costs. Under these circumstances, I think it is quite right for the widest possible latitude to be given in the interpretation of the concept of costs so that it will not be necessary for the board to incur losses owing to the deviant actions of a member of the profession. I therefore think that the proposal that this should be attorney and client costs in quite justified. For that reason I am also of the opinion that this should remain unchanged.

Mr Chairman, I believe the new amendments moved by the hon member for Hillbrow will not really get us any further. I am not prepared to accept the amendments moved by the hon member. I agree with the remarks made by the hon member for Sundays River.

At present the position in respect of attorney and client costs is that the Estate Agents Board has no specific authority to recover actual attorney and client costs incurred by the board in the process of the collection of penalties imposed by the board after disciplinary actions have been taken against individual estate agents. To accept the amendment of the hon member for Hillbrow in respect of the words “legal charges” will definitely not alievate the board’s present predicament as the general term “legal costs” or “legal charges” could still be interpreted as referring to party and party costs only.

The proposed amendment contained in clause 6 will eliminate the present unsatisfactory situation and will not lead to the total exclusion of party and party costs. Party and party costs are at present regulated in terms of the Magistrates’ Courts Act, 1944, No 33 of 1944, in respect of actions taken within the jurisdiction of a magistrate’s court, and, by the rules of the Supreme Court, in a Supreme Court action. Nothing contained in the proposed amendment affects this situation. As far as can be ascertained none of these actions for the recovery of the penalties imposed has even been defended.

In the circumstances, Mr Chairman, I regret that I am unable to accept the amendment of the hon member for Hillbrow.

Mr Chairman, I have only one difficulty in regard to the reply of the hon the Deputy Minister when he says that party and party costs are not excluded. As far as I am aware, as far as the interpretation of statutes is concerned, the rule of expressio unius est exclusio alterius holds good; in other words, the fact that attorney and client costs are mentioned is sufficient to exclude party and party costs. That is a point which I think the hon the Deputy Minister must take into consideration.

Mr Chairman, with respect to the hon member, I feel that I have argued that point. I am not of the same opinion as the hon member in this respect and I stand by my remarks in regard to his proposed amendment.

Amendment I negatived and amendment 2 dropped (Official Opposition dissenting).

Clause agreed to.

Clause 10:

Mr Chairman, I move the amendment to this clause standing in my name on the Order Paper, as follows:

1. 1. On page 9, in line 24, to omit “fourteen days” and to substitute “one month”.

As you know, Mr Chairman, we are dealing with a clause which provides for the procedure to be adopted where an estate agent fails to comply with an order of the board. This relates to the extended definition of “improper conduct”. If the hon the Deputy Minister will refer to clause 9, he will notice that one of the decisions that an estate agent has to comply with is in regard to the refund of certain moneys. As I mentioned during the Second Reading debate, he has to balance his books once a month. The moneys that he has in trust are invested either with banks or building societies and, in the case of these financial institutions, the accounts are presented once a month. It is in order to make these two periods equal so that nobody falls foul of the law that I suggest that the period of one month would be more appropriate in this case.

Mr Chairman, in the absence of the hon member for Vasco, I move the amendment to this clause printed in his name on the Order Paper, as follows:

1. 2. In the English text, on page 9, in line 23, after “board” to insert “or in respect of the fund”.

Mr Chairman, I indicated during the Second Reading debate that I would gladly accept the amendment of the hon member for Vasco, as moved now by the hon member for Innesdal.

†I also want to say that I think the amendment moved by the hon member for Hillbrow is a sound one and I am therefore prepared to accept that amendment as well.

Amendments 1 and 2 agreed to.

Clause, as amended, agreed to.

Clause 12:

Mr Chairman, I move as an amendment:

1. 1. On page 11, in line 3, to omit “forthwith” and to substitute:
2. not later than 3 days

The proposed section 32(4) provides that compliance must be forthwith. In the Second Reading debate I stated that the word “forthwith” is difficult for the courts to interpret and it is hard to say what “forthwith” really means. My amendment seeks the substitution of “forthwith” with “three days”. I have consulted the Dictionary on Legal Words by Claassens and there I read under “forthwith”:

He goes on to say that where a statute requires that action should be taken forwith after notice of appeal, it means “within a reasonable time”.

Once we start dealing with “reasonable time”, there is really no end to it. To put the matter at an end and to clarify it completely, I think we should fix a time limit. While I am not married to three or five days, I think in view of the urgency of the matter, that three days would be equitable.

Mr Chairman, in considering the section as a whole, it is actually more important to make sure that the audit will be completed within a specific period of time. Four months after the final date of the financial year is being laid down for this. Only the auditor knows and can determine the exact date on which he will complete his audit. In my opinion it cannot make much difference, in practice, whether one says “forthwith” or “within three days” or “as soon as possible”. Only the auditor would know exactly when this would be.

What is important is that we should read the two subsections in conjunction with each other. The important point is that we are now laying down a definite deadline for the completion of the audit. It could perhaps be argued that we should reconsider the first part of the section, but as far as the second part is concerned, in respect of which the hon member has moved his amendment, I think we can see that in the course of the four months in which the audit has to be completed, the auditor has sufficient time, depending on when he received his instructions. However, it is simply impossible to expect the exact date on which he must complete his audit to be determined from the outside so as to be able to ascertain whether he complied with the provisions in the section within three days. In dealing with a profession with the prestige and status of that of auditors, I feel we should rate their integrity highly enough to know that if we say “forthwith”, the auditor will do so as quickly as possible.

As far as the first part of the section is concerned, I do not want to suggest that we should change it, but I do want to draw the attention of the hon the Deputy Minister to the fact that we know from experience that this provision is going to cause great problems for auditors. Recently we found that because large auditing firms are not very willing to undertake these tasks, the smaller auditing firms are overloaded and there is a tremendous workload on their shoulders because all estate agents now go to them. They are definitely going to experience difficulties in completing this work within four months. I am mentioning this in passing; I do not think this is at issue today. It may perhaps be necessary for us to reconsider this at a later date and perhaps lengthen the period to say six months.

There is another aspect I want to bring to the attention of the hon the Deputy Minister in passing. We may have to consider fixing a deadline not only for the completion of the audit, but also for the instruction to the auditors to do the audit, because it will be of no use if the estate agent can wait until 14 days before the period of four months expires before giving his auditor the necessary instructions. It would then be impossible to complete the audit in time. This is a practical aspect the hon the Deputy Minister and the department could perhaps give attention to in the course of time.

As regards the amendment of the hon member for Hillbrow, I cannot see how it can in any way improve the position. I think “forthwith” will suffice. I do not think we shall experience any problems with this, considering the elevated status of the profession.

Mr Chairman, I thank the hon member for Sundays River for his contribution. I am under the impression that the intention is that within four months after the financial year has ended the estate agent must have had his books audited. I shall, in any event, convey the hon member’s remarks to the board, as well as his remarks in connection with problems that may arise owing to pressure of work. I also thank the hon member for his argument concerning the amendment of the hon member for Hillbrow.

The hon member for Hillbrow referred to dictionaries. I have also availed myself of dictionaries, certain Afrikaans dictionaries. The word “onverwyld” is defined in HAT (first edition, fifth impression) as “oomblik lik, sonder uitstel”. According to the Kern woordeboek van Afrikaans (third edition), it means “dadelik”. There should, therefore, be no reason for any delays. The hon member moved that we should insert “not later than three days”. This is unacceptable to me because it sets the profession an inflexible deadline. In contrast, the word “forthwith” retains an element of reasonableness, although they are still obliged to act without delay. My information is that the word “forthwith” is also acceptable to the board. In addition, the hon member’s motion could lead to unfairness, particularly when public holidays and weekends are involved. We are dealing here with a highly esteemed profession, and it is disciplined by a board of its own. If any problems were to crop up, the Estate Agents’ Board could take up the matter with the Accountants’ Board. I am convinced that the object of the amendment contained in the Bill will be quite clear to the auditors profession and that our arguments here will also give them an indication of the seriousness attached to the necessity for auditors’ certificates to be sent directly to the Estate Agents’ Board as soon as possible. The hon member’s amendment has of course, contributed to a discussion of this matter. Unfortunately I am not, however, disposed to accept the amendment.

Mr Chairman, I do not want to enter into a technical or legal argument with the hon the Deputy Minister, but the fact that the explanations of the word “onverwyld” that he quoted differ from the authority that I quoted, shows that there is a difference of opinion already. According to my authority the word “forthwith” does not mean “immediate”, but “within a reasonable time”. I believe it is the duty of Parliament to enact legislation which is clear, concise and unambiguous so that it is not subject to a variety of interpretations. If the hon the Deputy Minister has difficulty with the period of three days falling on public holidays, let me point out to him according to the interpretation of our statutes public holidays are excluded from this period. I cannot, with great respect, understand the argument of the hon the Deputy Minister.

Amendment 1 negatived (Official Opposition dissenting).

Clause agreed to.

House Resumed:

Bill, as amended, reported.

Mr Speaker, I move:

Before discussing the proposed amending Bill I just wish to inform hon member that, as I undertook to do, I referred the representations relating to the copyright Amendment Bill, 1983, particularly those relating to section 2, back to the Copyright Advisory Committee for further consideration before the amending Act was put into effect.

The advisory committee reconsidered the objections and in one instance even afforded the person the opportunity to discuss his objections further before the committee. It is clear that the problem of those who advanced objections was in no way affected by the amendments, and accordingly the Copyright Amendment Act, 1983, was put into effect on 14 October 1983.

To come back to this amending Bill, I can inform hon members that these amendments are chiefly aimed at eliminating specific shortcomings with regard to copyright in unpublished works, cinematograph films and sound recordings.

†The advisory committee, established in terms of section 40 of the Copyright Act, 1978, received representations in connection with various matters, some of which have been catered for in the present Bill.

Provisions to protect copyright in “published editions” were contained in section 16 of the repealed Copyright Act, 1965. These provisions were repeated in the Copyright Act of 1978. As it was felt that publishers were entitled to have the first print of a literary or musical work protected, provision has been made in this Bill to reinstate this form of copyright protection.

Unlike the United Kingdom Copyright Act of 1956 neither the South African Copyright Act of 1965—now repealed—nor the Act of 1978 contained any provision extending the life of copyright in certain unpublished literary works beyond fifty years after the end of the year of the author’s death. The fact that South African legislation does not provide copyright in unpublished works beyond 50 years after the death of the author is a disincentive for collectors to invest in the acquisition of such works and exhibiting them to the general public.

Provision has consequently now been made in this Bill to extend the copyright in unpublished works.

*According to the provisions of the Copyright Act, 1978, as they read at present, a person can only be prohibited from selling, hiring, offering for sale or for hire or distributing infringing copies if it can be proved—

1. (a) that the cinematograph films and sound recordings are infringing, that is to say, that they are reproductions made within or outside South Africa without the authorization of the copyright owner;
2. (b) that the person who effects the infringement was positively aware that the copies in question were infringing copies at the time of making them; and
3. (c) that the infringement was effected without the authorization of the copyright owner.

†The practical difficulties involved in proving the aforementioned points by way of admissible evidence are enormous. The cost and delay occasioned by having to obtain evidence in order to provide proof of these points are considerable and seriously detract from the ability of copyright owners, in civil proceedings, and the State, in criminal proceedings, to take prompt and effective actions on a continuing basis to prevent and hopefully to eradicate piracy. In order to attain this objective it has been necessary further to define the nature of copyright in cinematograph films and sound recordings; to create certain presumptions in respect of the proof of infringements of copyright in cinematograph films; to create new offences and to make provision for increased and additional penalties. The proposed amendments seek to simplify the task of bringing copyright proceedings in cases of piracy without necessarily extending the scope of the rights of the copyright owner.

In conclusion I have to advise that the proposed amending Bill was published in the Government Gazette for general information on 21 October 1983.

*Mr Speaker, I have not gone into all the details of the principles incorporated in the Bill. However, if hon members so require, I shall answer questions and provide further information if necessary.

Mr Speaker, “I think there is no doubt that copyright is a property which one is entitled to have protected and that the law should be of such a nature that property can be protected”. Those were the words of the hon member for Yeoville in 1976 in a debate on copyright. They are as true today as they were then.

As I understand the situation, the prime reason for this amending legislation is because of the tremendous amount of infringement that has been taking place in the video industry in South Africa. The video industry in South Africa fulfils a most useful purpose. It is providing home entertainment on an ever-increasing scale within South Africa. I think the public generally greatly appreciate the opportunity to be able to buy video films, to hire video equipment and to have entertainment in their homes at which they can have two or 22 people and where they can be entertained for several hours over weekends or whenever they choose. This has enormous entertainment value. The bulk of people providing this service are very honest and very hardworking. One will find their shops open on Saturdays, Sundays and public holidays, and they take films back, hire films and one can browse through their shelves. I believe they are providing the public of South Africa with an extremely valuable service.

However, in with these honest and hardworking people, the minnows of the business, there are some sharks and piranhas. The piranha although small is just as deadly as the shark, and these operators must be stopped. This infringement of copyright is a multi-million rand industry. If the law requires more teeth in order to stop it, then it should be given those teeth, not to deal with the minnows, but to deal with the sharks and the piranhas. It is estimated that approximately a year ago piracy in video hire accounted for as much as 60% of the tapes in video shops. It is also estimated that this illegal pirate trade costs the legitimate operators some R30 million per annum That is big business in anybody’s money. The sharks in the game are those who import videos from overseas, copy them and distribute those copies to retailers throughout the country. There is very big money in this, and I understand there is a case before the Supreme Court at the moment in this connection.

There are also those that I have termed “piranhas”. They copy for their own use. But whether you are doing it on an one-off basis for your own use—by own use I mean they let them to their customers—or whether it is the large dealer who copies and distributes widely, it is nevertheless the theft of somebody else’s property and should therefore be punishable. However, I do not believe that the small operator should necessarily be punished to the same extent as the large operator who is making enormous sums of money. The video industry is probably overtraded at the moment, but I do not think we should interfere with that. This is one of the things that happens in the private enterprise system, and private enterprise will sort this out. No doubt some of these operators will not be able to stay in business but will go to the wall. So the trade will get on to an even keel. Some will not survive the realities of the free market system.

I do not believe either that there should be control of outlets to solve this problem. The corner grocer who turns a corner of his shop into a video outlet has low overheads and can probably supply videos fairly cheaply to the public and provide entertainment for the home-owner. However, one of the problems—and I should like the hon the Deputy Minister to consider this—that all operators of video shops have, whether they are legal or illegal, is that some 700 films are registered in the register that has been set up by the Government, while some 12 000 are apparently not registered although copyright is held on those films by South African distributors. Action is taken against shops and the shop-owner has no way of knowing that he was doing wrong. This can be a source of great embarrassment to him. I understand that hundreds of tapes have been removed from shops. Those tapes do not appear in the register, but they have nevertheless been physically removed because copyright exists.

The organized video retailers have set up a couple of organizations. There is the Cape Video Association and there is the South African Home Movie Association. These organizations have in the past requested lists of the films on which copyright exists. They have done this on a number of occasions. They have also asked the distributors for such lists. However, as yet no list of these films has been forthcoming. I believe hon members can appreciate the quandary of the small video-shop owner in suburbia. It is a great problem, which is perhaps not relevant in terms of the amending Bill except as regards the massive increase in fines. I will deal further with that increase in fines when I discuss clause 11. I believe there should be some sort of investigation into the situation I have outlined.

There is also the question of what is known in the trade as the “golden oldie” films. My information is that after 25 years these older films are released from copyright, that no copyright thereafter exists on those films and that one can then copy them, show them, hire them and let them without having to pay anyone in respect of copyright or royalties. However, I understand that now the distributors of video films are telling retailers that, after the amending Bill before us has been passed, those “golden oldies” will also be subjected to copyright. I personally cannot see in terms of what provision of this Bill that can occur, but I should like the hon Deputy Minister to react to that particular point because I know that there is great concern amongst video-hire shops throughout the country at what they have apparently been told.

At the moment the only source of videos is the big distributors and in this regard I think we also have to be careful that we do not create any sort of monopoly, which would lead to an increase in the price of videos generally, to the detriment of the public as a whole. I think that there is more than meets the eye to this whole business and I believe that in due course some type of investigation by the hon the Deputy Minister’s department might be called for with a view to sorting out some of the anomalies. To take evidence from some of the hire shops and associations would, I believe, be a good thing which could lead to a better situation for the public in general.

We of the official Opposition will support this amending Bill at Second Reading, just as we supported the original Act. We participated in a Select Committee on that original Act. We support this Bill because we believe that private property should be adequately protected against theft. However, our attitude in the Committee Stage and in the Third Reading stage will to a degree be dependent on the hon the Deputy Minister’s reply to suggestions I am going to make to him on clauses 10 and 11. I hope that the hon the Deputy Minister will be reasonable in his consideration of the amendments I have on the Order Paper to these clauses and which I will be moving in the Committee Stage. These are the two clauses, clauses 10 and 11, that I will be dealing with. A colleague of mine will be dealing with the other clauses in the Bill.

Clause 10 creates three presumptions. The first point I want to make about these presumptions is that they can only be applied in the case of registered firms. In other words, there is a register in Pretoria, the public has access to it, where they can make copies and can be informed about what films are listed. I understand that there are some 700 films on that register at the moment and, as I said earlier, that there are some 12 000 films that are not on that register. These presumptions are only effective in cases where films are on the register. Of these three presumptions two are rebuttable and one not. As regards those that are rebuttable, we believe the hon the Deputy Minister has made out a good case for them. In view of the fact that they are rebuttable we do not intend to object to them. The one is that the person who is alleged to have done an act which infringes the relevant copyright did that act without the required authority. He would have to prove—I think that is fair enough—that he had the required authority. If he can do so, then obviously that presumption falls away.

The second is that in the event of him being found in possession of pirate material, provided he owns a video shop, it can be assumed that he had those particular videos for the purposes of hiring, letting or selling them. Again, that is a fair presumption, and again he is entitled to rebut this presumption if necessary. I would point out that I think it creates a little bit of a tough situation for video hire shops in terms of their own private films which they might have at home for their own entertainment. However, I think it is fair enough that a hire operator has to be in a different position to the ordinary public.

We then get to the presumption that is not rebuttable. I want to look at that in the light of the enormous fines and penalties that are brought in by clause 11. Let me quote paragraph (a) of the proposed new subsection (9) of section 26 of the Act, as contained in clause 10 of the Bill, as follows:

As I have said, there is this register which is available to the public and where copies can be obtained. However, I want to ask the hon the Deputy Minister how the little man in the suburbs or in the platteland towns is going to find out fast, because he becomes liable from the date of the lodging of the application. If he is found guilty of an offence he can be fined up to R10 000 or imprisoned for up to 10 years. How is he to know that such an application has been lodged? He can have an attorney in Pretoria to keep an eye open and inform him, but that is a very expensive solution. Secondly, he could find out perhaps from the patents journal, but I understand that this journal is sometimes received up to six weeks after its publication. I believe that this clause cries out for an amendment that will enable a shop to know that a film is registered within a reasonable period of time. Therefore I intend moving at Committee Stage that any film that is registered should be notified in the Government Gazette. I do not think this is onerous. In fact, I think the sales of Government Gazettes might go up considerably by sending them to video shops. This is the accepted way for any Government to inform the public of what is happening in terms of the law. I do not believe it would be onerous to expect the State to publish that information in the Government Gazette. As I have said, there are only 700 at this stage. I do not know how many more there will be. Let us assume that it doubles. Even then I do not think it is onerous, when one considers the information that is currently published in the Government Gazette, to ask the Government to put that in. Once it was published in the Gazette, that clause would apply, and they could be expected to know. I hope the hon the Deputy Minister will react to that point.

Lastly, I want to deal with the penalties. These in my view are very, very severe indeed. We find that on a first offence the penalty is being increased from R500 to R5 000—tenfold—and the imprisonment period is being extended from six months to three years. On a second offence the fine is being extended from R1 000 to R10 000, while the imprisonment is extended from one year to five years “for each article to which the offence relates”. There can be a hundred articles in a shop that are pirated, and therefore these penalties can be extremely severe. Yet we have decided not to oppose these penalties because we believe that our courts in this country are reasonable and that they will understand that the person concerned is a big or a small operator and will levy a fine or a prison sentence accordingly. I am prepared to leave it to the judgment of our courts as to what fine is to be levied. All this clause does is that it sets a maximum; it does not set a minimum. Therefore the person adjudging a case can impose a fine of R1 if he wishes to. We believe therefore that this particular clause should go through, but we do not like the proviso. Basically the proviso is a restriction of trade because it provides that in the case of a conviction of a person in terms of this section of an offence that person can from a date determined by the court be prohibited from carrying on, or having any direct or indirect financial interest in or deriving any income from any business which sells, lets, offers, exposes or distributes reproduction or adaptations of cinematograph films. That is a restriction of trade and as such prevents somebody earning a living. This I submit may happen in a case where a person has been proved to be a crooked operator in the past. But he would have been fined for that. He would have had his punishment, so why punish him over and above the enormous fine or prison sentence which the court can impose? If he is imprisoned, he is going to have great difficulty carrying out this type of function. We therefore do not believe that this provision is fair. It assumes that people cannot turn over a new leaf. It assumes that they cannot decide that there is no future in operating as they have been operating in the past because they have been fined and imprisoned, and that they are now prepared to operate a clean business. I believe that this should not happen. If one deletes that proviso then one has to delete subsection (c) as well because it becomes irrelevant if the proviso is altered, as I suggest in the amendment I propose to move.

I hope the hon the Deputy Minister will seriously consider the amendments we propose to move because we believe that it will be in the best interest of the video industry and private home entertainment. However, we believe that this Bill as a whole seeks to protect people’s property, and as such we support it.

Mr Speaker, in the course of my speech I shall refer to some of the aspects raised by the hon member for Port Elizabeth Central. The amendments envisaged will of course be discussed in detail when he moves them in the Committee Stage.

†Whilst thanking the hon member for his support of the Bill, I would, however, at this stage reply to certain of the principles involved in the amendments of which he has given notice. It would seem to me that the hon member has to some extent misinterpreted the essence of copyright. Copyright law has as its object the intellectual property—that is the original product—of the human mind, and as such is aimed at protecting the author against any unauthorized copying, in whatever form, of his original work. The protection afforded the author is extended immediately the product is reduced to visible form. There are no formalities that have to be complied with A cinematographic film, as defined, is nothing but a form of intellectual property and its producer enjoys copyright of his product the moment it comes into existence, and not only when registered in terms of the Registration of Copyright in Cinematographic Films Act, 1977.

Such registration only basically serves an administrative and evidentiary purpose to establish a record of such films and the ownership thereof, and to make protection of copyright thereof more effective. An unregistered film, however, is still subject to the same scope in copyright as a registered one. It certainly makes it more difficult for the owner to prove his copyright and it would behove him indeed to register. It does not, however, alter the fact that he holds such copyright even if the film is not registered.

Furthermore, section 18 of the Copyright in Cinematographic Films Act determines that registration shall take effect, albeit retrospectively, from the date on which an application is lodged and not on the date of its final acceptance. It also provides for advertisement thereof. So there is a form of public knowledge, which is exactly what the hon member for Port Elizabeth Central is now pleading for. Should the amendment of which the hon member has given notice be accepted it would bring about a discrepancy between these two pieces of legislation which are complementary to one another, and as such can cause unnecessary practical problems.

Regarding the second amendment of which the hon member has given notice one must look at the purpose of this measure, which, I agree, is a very harsh one, namely giving a court the discretion to prohibit a person found guilty of contravening that particular section to be involved in any way in a business that sells, lets, offers, exposes or distributes copies of cinematographic films. It is namely aimed at the prevention of the unauthorized distribution of such products; in other words, the pirating thereof. This is a phenomenon which has grown to such proportions that it has become an industry in itself, and a very lucrative and extensive one too. To impose only a fine, however heavy, will not be an effective deterrent. The offender still has his whole network which he can simply reactivate in order to start up his business again almost immediately. Should he be barred from any further involvement in such business the measure would be far more effective in protecting copyright and legitimate enterprise, which is after all the object of this legislation. The amendment the hon member wishes to move would also therefore not seem to be in the best interests of those we are seeking to protect.

*Mr Speaker, I should now like to draw attention to certain other aspects dealt with in this Bill. As is the case in virtually all other fields, rapidly developing technology is setting increasing demands in the field of copyright. Due to modern mass communication and the availability of advanced apparatus, opportunities for infringing copyright are so much more numerous and readily available, and on the other hand effective control is so much more difficult. I believe that in order to accommodate these developments, two broad tendencies may be detected in copyright.

In the first place, because individuals often feel powerless against exploitation, there is a movement among authors to entrust the protection of their interests to collective agencies, which are then able to act so much more effectively by way of ordered, collective bargaining power. Organizations such as Samro are an example. This development will probably lead to fundamental changes in the essence of copyright, in that in order to provide effective protection it will be necessary to extend copyright further beyond merely the author himself and his work as such. It will also make provision for supplementary rights to the other parties in the publishing process, for example the publisher of a book. To some extent this Bill gives effect to this essential development in that it gives the publisher of a literary or musical work the exclusive right to his specific typographical arrangement of that particular work. Thus protection is granted not only to the contents of the work in regard to which the author’s rights remain unchanged, but also in the specific edition. In this way the publisher and, through him, the author, are protected against unauthorized copying. In view of the sophisticated photocopying apparatus which are at present freely available this is a welcome extension which at the same time protects the publisher’s investment and ensures that the author will enjoy the full commercial benefit of his labour.

The second trend to be detected in the development of copyrights is internationalization, in that the copyright systems of various countries are increasingly being made more uniform. Thus, as the hon the Deputy Minister mentioned, this Bill brings the position here as regards so-called unpublished works in line with that in Britain and various other, mostly Western, countries. The legislation provides that there will also be copyright in works in regard to which, before the death of the author, there had been no publication, performance in public, or offer for sale to the public of records thereof. In such an instance copyright continues to subsist for a period of 50 years after such publication of the work in the ways specified. The underlying reasons for the protection of unpublished works is to enable, and indeed, to encourage the owner to publish the work and make it available, without the works thereby losing their intrinsic value. The majority of works affected by this are works in regard to which the copyright would otherwise have lapsed and any person, however he may have acquired the work in question, would be able to exploit it commercially. In the normal course the owner of such works had to make a considerable investment to obtain the work. He would then preserve it to the exclusion of the public to prevent such a work from being exploited unlawfully. Works that are sometimes of priceless historical and other value—one calls to mind for example the Africana collection of Mr Oppenheimer in the Brentwood library—are as a result not available to the public, inter alia because they no longer enjoy copyright protection. By reviving copyright in these works, their ownership is ensured, while the works may then be made available in the public interest.

In conclusion I want to refer to a further aspect, viz the measure that is geared to providing more effective protection for possessors of rights with regard to cinematograph films and sound recordings. As far as these two types of work are concerned, the possessor of the right is now also being given the exclusive right inter alia to import such cinematograph films or sound recordings. As already pointed out by the hon the Minister the effect of this, read together with the other provisions, is that a person who distributes a cinematograph film or sound recording will have to prove that he is authorized to do so. This provision is aimed at combating the so-called “parallel importing” which is creating many problems in practice. What it amounts to is that the owner of a cinematograph film that was made in, say, the USA, grants the exclusive distribution rights in Britain to one company and in South Africa to a different company. A person can then obtain a cinematograph film quite lawfully in Britain and bring it to the Republic where he distributes it and by doing so prejudices the position of the South African company which in many instances has gone to considerable expense to acquire the distribution rights of that cinematograph film in South Africa. In legal proceedings against the person who distributes unlawfully in the Republic of South Africa, tremendous problems of evidence have cropped up, in that a series of witnesses have to be brought here from abroad at considerable expense and a great deal of trouble, to prove that his distribution in the Republic was in fact unauthorized. By placing the burden of proof on the person in question this clumsy and expensive procedure is being eliminated.

The legislation also embodies certain measures relating to evidence, criminal law and administrative matters which will in practice protect copyright more effectively. As a whole the legislation will effect a considerable improvement to the existing position and this side of the House takes pleasure in supporting it.

Mr Speaker, the CP also supports the Bill. I believe that the products of a person’s intellect are worth protecting even more so than his purse, furniture or other tangible property. I think the works of depictive artists, composers, authors, the various people referred to in section 2, are works which come from their souls, from their lives—it is part of them—and for that reason measures taken to protect those rights should not be inadequate or ineffective. It is essential for copyrights as defined in section 2 of the principal Act to receive proper protection as times change and the piracy of these works becomes more widespread.

The hon the Deputy Minister also mentioned that the Advisory Committee on Copyright Law had studied these amendments. This is complex legislation. These are complex matters for which one needs expert knowledge. It is therefore to be welcomed that such a committee first studied amendments of this kind to satisfy themselves that they were within the bounds of acceptability. In addition, the Bill was also published for general information in October 1983. We can therefore assume that what is now before this House, is the product of a collective effort to which people who have a special interest in this matter had no objection.

The fact that publishers are also receiving protection is also welcomed now. Publishers take tremendous risks. I feel it was unfair that they did not enjoy this protection in the past. It is to be welcomed that a publisher is now being afforded the same protection which the author himself enjoys.

The hon member for Port Elizabeth Central mentioned video business undertakings. Such enterprises have sprung up like toadstools in South Africa. The hon member expressed his concern regarding the problems they were going to experience in ascertaining whether or not a film had been registered. In this regard I am more inclined to agree with the hon member for East London City that the stricter the measure the better.

There is another aspect of this video industry which does not really fall under the field of operations of the hon the Deputy Minister, but which is causing increasing concern to the church, parents and educational institutions. I am referring to publication control over these films. The kind of film one can obtain openly and without any difficulty from these video firms nowadays is, to say the least, disgraceful. There are certain kinds of films which are being made available to the public, to minors, without any control whatsoever.

This is an aspect to which we are giving attention.

I am glad to hear that because this is a matter which is causing increasing dissatisfaction among the public.

As far as the prescribed penalties are concerned, I have already said that it is my party’s standpoint that these rights should be protected to the hilt. For that reason we are in favour of the penalties being made more drastic, and we are glad that these various presumptions are now to form part of the legislation. In two of the three cases they are rebuttable presumptions. This is fair and also in line with other legislation of this nature.

Mr Speaker, I thank the hon member for Brakpan for his support for the Bill and also for his sound views on the need for copyright to be protected. I also agree with the hon member as regards the distribution of pornographic material on video cassettes. Although this measure is not directly aimed at combating this kind of thing, it should nevertheless indirectly discourage its distribution because the increased penalties should put hirers on their guard against the infringement of rights, and hopefully against the distribution of pornographic material as well.

This is a highly technical measure. Nevertheless it should have wide practical implications. As such it will have an effect on this industry which is probably one of the fastest growing industries. I am now referring to the distribution of video tapes. This should encourage the industry to act in a careful and responsible way. One of the biggest problems in this industry is the hiring out of pirated copies. This is assuming major proportions. In the first place there is the general availability of video recording machines, and this facilitates unauthorized recordings. In addition, no licences are required for such recordings. This means that anyone can run a business like this from his own home or even his own backyard.

As the legislation at present reads there is a tremendous onus of proof on the State or on plaintiffs in civil cases to prove guilt. This Bill is to a great extent accommodating the State and the plaintiff, firstly by establishing as irrebuttable presumption that everyone involved in a case had cognizance of the particulars contained in the register of copyright and also by the establishing the rebuttable presumption that a person who is alleged to have carried out a certain action, did so without authorization.

The penalties for these offences have also been increased, and the courts are being given the discretion to prohibit a person from obtaining direct or indirect interests in a business hiring or selling films or reproductions.

As has already been pointed out, this measure should have two important consequences. In the first place it will encourage collectors to collect old documents. The reason for this is that they will not now lose their copyright quickly and documents will therefore remain valuable for longer. In the second place it will encourage collectors to place the documents they do have at their disposal at the disposal of researchers and interested persons, because they will still retain their copyright and these documents cannot be misused. Persons who have already acquired rights in regard to such documents, 50 years having elapsed since the death of the author, will also enjoy a certain amount of protection in terms of the Bill.

Another provision is that publishers are being given copyright in published works. This copyright is limited and is not copyright on the contents of the publication, but only on the specific typographical arrangement of the work. The contents may therefore be published with the author’s consent and without the publishers’ consent. This restriction only applies to the copying of the work. I feel this is fair because many publishers take a great deal of trouble with the typographical arrangement of their books. It is only right that they should enjoy protection in this respect.

I take pleasure in supporting the measure.

Mr Speaker, the NRP will be supporting this measure. There are basically three areas of the Copyright Act which are being amended here. The first is very clear from clause 1, namely the reinstatement of copyright in respect of published editions. We go along with that, because we feel it is necessary that the first print of a literary or musical work should be protected. What concerns me, is that it was left out of the Bill which came before Parliament in 1978, a measure which served before a Select Committee. It just goes to show that Select Committees are not infallible. However, we can see the reason for this provision and we support it. We similarly support the provision in clause 3 which extends the life of a copyright of certain unpublished works beyond the 50 years after the end of the year of the author’s death. For the reasons given by the hon the Deputy Minister, we believe that this provision should also be supported.

The third area concerns the pirating—this is the term which is being used for it—of video and other types of tapes. We all listened to the hon member for Port Elizabeth Central’s speech in which he gave us a little insight into the industry. This industry has expanded tremendously in recent years and is a major industry in South Africa today. What really surprised me in what the hon member said, was the figure of R30 million per annum which he quoted as being the cost to the authentic producers of these works as a result of pirating. If that is the order of the loss incurred by these people, we certainly do believe that something should be done about this. I was also interested to hear him say that they have tried to form various associations so that they could obtain lists of those films which had been registered as copyright items. It amazes me that an industry of this size has not come to grips with this problem, because surely this is basic to the whole industry, namely that the people who produce these films and have them copyrighted, should make this knowledge available to everybody. In fact, I think that at every one of these video hire shops there should be a catalogue available showing the list of copyrighted works so that when the public hire a video film they will be able to establish that it is not a pirated film. I would say that the industry itself should try to put its house in order. They should make sure that all the dealers to whom they distribute these films are made aware of the fact that the films are subject to copyright. We in the NRP have the same reservations as the hon member for Port Elizabeth Central as regards clause 10 and 11, and I think the hon the Deputy Minister should accept his logic and reasoning as regards clause 10(9), which reads:

I would like to tell the hon the Deputy Minister that I support the hon member for Port Elizabeth Central as this should surely read “as from the date of publication in the Gazette”, and not the “lodging of the application” because how would a person possibly know that this had been recorded in the register?

The next reservation we have concerns clause 11(b), which substitutes subsection (6). This has a proviso. I was pleased to hear the hon member for Port Elizabeth Central say that because of the scale of this theft, very stern and harsh penalties are required. I was also pleased to hear him say that there is a discretion on the part of the judge to compose a penalty from R1 up to R10 000. This clearly indicates to me that the hon member trusts the judges to use their discretion in the correct manner. But the hon member wants to delete the entire proviso. We in this party believe that occasion could arise …

[Inaudible.]

Yes, but you virtually want to reinstate what there is at the present time, in other words a maximum of R50 000. The hon member wants to eliminate the power which the court will have in terms of this proviso to exclude a person from trading in this field. We in this party are inclined to believe that there are certain individuals who should be barred from trading in this type of film because they are nothing but thieves and are running totally illegal operations.

We do, however, believe that the clause as it is now, does not give sufficient discretion to the judge. This clause reads inter alia

One should bear in mind that this is a case where a person has previously been convicted of this and is an habitual thief in things such as this. The clause further reads:

That means that he will be prohibited from trading for all times as from that date. In the Committee Stage I would like to move an amendment to the effect that the court may in its discretion—I hope the hon member for Port Elizabeth Central will accept this—in addition to any other penalty which it may impose, prohibit that person from a date and for a period determined by the court, from carrying on. The court would, in other words, have the discretion to ban a person from trading for any period of time, be it one year or for life, depending on the record of the individual.

Having said that, I believe that the people who produce films and sound recordings, as with any other works of art, should have their copyright upheld and their work protected. For these reasons, we will be supporting this amending legislation.

Mr Speaker, one is very grateful for the support the hon member for Amanzimtoti has given this Bill, although he did indicate that he would be moving certain amendments. One is also grateful for the general agreement of all the parties with regard to this measure. To a large extent this is due to an advisory committee consisting of members from both the Government sector and the private sector, a committee which regularly looks at the implementation of the Copyright Act. I think it is essential that this committee should give continual attention to possible loopholes which could arise and that it should close them. I think one must therefore expect that this Act will possibly come before this House on a regular basis so as to be amended where necessary. It is very interesting that until 1978 when the present Act was passed, the administration of copyright really entailed very little work. Since then, however, it has become an almost full-time task. I therefore wish to avail myself of the opportunity to thank this advisory committee under the chairmanship of Mr Justice Van Renen—as I have said, people who are in practice also serve on it—most warmly for the work they are doing in this regard.

Just to place the Act in perspective, I wish to point out that it is one of the four Acts that deal with immaterial rights. As the hon member for Brakpan rightly said, there is a close link between this Act and the other three Acts, viz the Patents Act, the Designs Act and the Trade Marks Act. These four Acts together deal with immaterial rights. As the hon member for Brakpan said, this is linked only to what is produced by man. I agree with him. I do not think one can go far enough to protect that kind of thing. Now I find it very interesting that many of the arrangements contained in these four Acts really arise out of international agreements. In this specific case they arise out of the Berne Agreement which was accepted in 1886—almost 100 years ago—and in which South Africa is still a very important participating member today. That agreement—the body concerned is situated in Geneva, Switzerland—creates a very high standard and sees to it that original works from a certain country are protected in the other 75 member countries as well.

The hon the Deputy Minister referred to last year’s amendment and said that the advisory committee had looked at that decision again. As a matter of interest, I just want to focus the attention of the House on what this was about. It was about the three-dimensional product, ie the end product. The two-dimensional product is the drawing, whilst the three-dimensional product is the end product that is made from it. Of course, the two-dimensional product has full copyright for the lifetime of the author plus 50 years, whilst an amendment was effected last year in the case of the three-dimensional product to protect it for 10 years.

Hon members have referred in detail to the three amendments being affected by this Bill. I just want to try to indicate in a practical way how those three amendments are going to work. Firstly, they are concerned with published editions. The hon member for East London City and the hon member Mr Schutte referred to the question of published editions and said that they were specifically concerned with the type of letter, the printing process and the lithographic way in which a work is published. I now wish to give a very simple example. Each year companies have to submit certain forms, as prescribed by the Companies Act. The contents are nothing new. Nor is there any copyright on them. However, one could place a copyright on the way in which they are printed. There is a well-known publishing company— I do not wish to mention its name—that has these forms printed and makes them available to companies which can then make use of them. It often happens that other people make photocopies of the forms, thereby abusing the service being rendered. It is very interesting to take note of the way in which that company prevents its copyright from being infringed. It makes deliberate spelling or typing errors on the form so that it can be very sure when a photocopy of the form has been made. That is the first amendment. A person who uses a specific kind of printing process is therefore also being given the necessary protection.

The protection of unpublished works has already been mentioned. Someone referred to the Brenthurst Collection which was purchased by Mr Oppenheimer. I wonder whether hon members realize that inter alia, what he purchased contains original works of Shakespeare that have never been published. Amongst other things, it also contains Thomas Baines’ very well known Drawings and Diaries. These are works that have never been published before and which are of inestimable value to research. It is therefore imperative that those works be protected in some way so that those people can be encouraged to make them available to the public for the purposes of research. Shakespeare died centuries ago and the 50 years after his death are also long gone. One could therefore walk into a place where his works are housed and make a copy and have them published. Of course, the copyright of those works then goes by the board. The whole purpose of this legislation is to make provision for copyright on that kind of very valuable work, and to encourage people to place it at the disposal of the public in this way. The question I find interesting—I should like the hon the Deputy Minister to give us a decisive answer—to what extent paintings, etchings and sketches will be protected in this way. Recently there was a case where a number of Pierneef’s works were discovered, 50 years after his death. Will the owner of these works be given the necessary protection in terms of these provisions? As I interpret the proposed new section 3, there will, in fact, be the necessary protection for unpublished music. I read recently in the Press that some works of Mozart had been discovered now, after 300 years.

The remainder of the legislation—the hon member for Port Elizabeth Central placed a great deal of emphasis on this—deals specifically with the onus of proof with regard to the copying of cinematograph film and sound recordings. The whole purpose of this legislation is to make it easier for the police to institute prosecution in this regard. I want to mention one practical example. A new phenomenon has appeared, viz record hire shops. There are five in the Transvaal and 11 in the Cape. I know of one in Stellenbosch. These people rent out records at R1,20 a day. Surely the aim of the person hiring them is certainly not to listen to the record once or twice, but to tape the record on a ca sette for his own use, or even to sell it. I do not think there is an hon member in this House who has never been guilty of this offence.

I have never been.

If the hon member for Kroonstad has never been guilty himself, I am sure his children have been. [Interjections.]

This is a general problem. The hon member for Port Elizabeth Central pointed out that R30 million per annum is earned illegally in this way.

I now want to put the other side of the case, however. Last week in Johannesburg I purchased a cassette for R18,99 plus tax. In my opinion, that is an outrageous price, since last year I purchased the same article in America for $10. I often wonder whether the man in the middle is not responsible for the problems that exist with regard to this kind of product, for if one is going to change that price for something, one must expect that people are going to try to take a short cut in some way or another. I therefore believe that these amendments are essential.

In conclusion, I should like to mention another example. Some companies send people overseas specifically to go and purchase the latest records, particularly pop records and so on, as well as to obtain the rights for them. For example, such a person purchases 50 records, brings them to South Africa and offers them to the SABC, or whoever. Those records are then played, and eventually, say, five of them reach the so-called hit parade. Then only those five records really have a market. The company concerned paid R200 000 for 50 records overseas, together with the rights attached to them, five of them eventually reach the market and then those five records are copied by other people left, right and centre. I can find no fault with it if an hon member of this House copies a record for his own use, but I am afraid that it does not end there. People copy records by the thousand. Those copied records are then sold at the expense of the person who really has the copyright. However, I am afraid that one will just have to accept this, since this is linked to the tremendous development that is taking place in this field. Items are becoming cheaper and more easily available, and that is why I think it is necessary that loopholes be closed as they appear. I have a great deal of appreciation for the work of the advisory committee and I take pleasure in supporting the Bill.

Mr Speaker, as hon members have pointed out, this Copyright Amendment Bill makes provision for three major alterations to the Act of 1978: Firstly, by the addition of published editions to the material on which copyright may be obtained; secondly, by the inclusion of coverage of copyright on unpublished works and, lastly, by further extending the provisions regarding films.

Copyright is vested in the publisher of the published edition itself. The work done, typographically arranging of a particular design, a layout or a typeface on a printed page, is such that this kind of endeavour should be protected by copyright. Copyright would be owned by the publisher himself, who may be an individual or a company, and it is totally independent of the copyright of the work being reproduced. Ownership of the one would appear to consitute no claim to ownership of the other. The publisher thus will be protected against quick and easy reproduction—the photolitho process has been mentioned as an example. However, if another publisher expends the same time and effort on another edition of the same work, then this can be done, providing that there is no intention to copy the first. It is worth noting, as has been mentioned, that copyright in a published edition is vested in the publisher whether or not the work that he is publishing is in or out of copyright.

In the case of an unpublished work, the present amendments appear to correct a gap in the Copyright Act of 1978. The wording of this amendment is taken directly from the United Kingdom Copyright Act of 1956. Since in section 3(2)(b) of the Copyright Act provision is already made for the retention of copyright in cinematograph films or photographs for a period of 50 years from the making of the work or 50 years from it being lawfully available to the public, the proposed amendment is fully acceptable.

We move therefore to the remainder of the additions to the sections of the Act concerning published editions. These appear to be in the nature of bringing the relevant provisions into line with the remainder of the items for which copyright is available in terms of the Act. With these, we in the PFP have, as has already been mentioned, no particular problems. The two clauses covering the importation, trade and distribution of cinematographic films and the associated penalties have been well covered by the hon member for Port Elizabeth Central. It is sufficient to add that the value of the film and video trade in South Africa today most run into several tens of millions of rand a year. It is common cause that piracy as such is responsible for robbing a large section of the real copyright holders of their legitimate income.

I would strongly support the amendments the hon member for Port Elizabeth Central indicated he was going to move during the Committee Stage. The hon member for East London City mentioned that these may cause problems since there may then be a discrepancy between the 1977 Act for the Registration of Cinematographic Films and the present amendments contained in the Bill now before the House. I believe that this is not so, particularly if one notes that registration only comes into effect after the advertising period of such registration. I do not believe that this constitutes a major difficulty.

There are objections by retailers regarding the time factor. It is, I believe, unreasonable for retailers to be assumed to have knowledge of registration from the date of the lodging of the application. I believe one must in this case assume the position of the reasonable man. An application is lodged in Pretoria, in the Transvaal, and on that same day a retailer in the Western Cape is assumed to have knowledge of such a registration. I believe it is only fair that an amendment in this respect be supported by the hon the Deputy Minister.

I must say one steps very gingerly into the minefield of copyright legislation. It is quite clear that there are pirate copies of films available. At the same time, if one looks at the recent court case of Paramount Picture Corporation vs Video Parktown North regarding the vesting of copyright in the films Star Trek and Grease, it would appear as though there are major difficulties being brought about by overseas activities of non-South African corporations who are involved in handling the exclusive right for dealing in these films. The opinion expressed that the importing of all unauthorized pre-packed tapes for sale or hire is an offence in terms of the Copyright Act has caused considerable concern among all, including legitimate, video dealers, and one is tempted, I think, to speculate that much of what is being provided for in this amending Bill, and in particular the penalties, is aimed at deterring all dealers who are not directly connected with the four major film suppliers. I would most strongly support the view that the final penalty, which could impose prohibition of a person carrying on a business of selling, letting, offering, exposing or distributing films, is harsh in the extreme. Taken with the other penalties this appears to be out of all proportion with the offence. I must point out that the penalties for infringing the Copyright Act in the United Kingdom, are a maximum of £50 or two months’ imprisonment. There is no mention of restraint of trade. In the case of the USA, in terms of the more recent code of copyright, provision is made for a penalty of $25 000 or one years’ imprisonment for a first offender, and $50 000 or two years’ imprisonment for subsequent offences. Again, however, no restraint of trade is imposed.

One must emphasize the importance to the broad South African community of the small video retailer at the present time. There has been a considerable social effect with the introduction of easily accessible video films. Certainly there are certain social disadvantages. I shall touch on one of them in a moment. By and large, however, a greater family joint-recreational participation is being brought about by the introduction of this trade.

I should also like to echo the kind of comment made by the hon member for Brakpan concerning social problems introduced by easily available video films.

One major social difficulty that must be voiced is the use of the so-called second channel broadcasts in many high-rise buildings. I believe that the video trade and/or the Government has a responsibility to ensure that such performances are carried out in terms of relevant film restrictions. A considerable number of our young children make use of this channel during the afternoons to “entertain” themselves. The films they see are occasionally suitable or educational but far too often the videos that they see are psychodramas or horror or murder stories that are peppered with brutality, violence and sexual deviance. Who is responsible for breaking the law by showing such videos to the group for which the Government has decided a restraint is needed? Is it the absent parent? Is it the caretaker or owner of the building? Is it the rental company hiring out the video or is it the copyright holder himself? I certainly believe that this, as with the one mentioned by the hon member for Brakpan, is an area that is worthy of further investigation.

Another area that I believe is worthy of investigation is the entire question of cable television. I believe it is the responsibility of the Advisory Committee to examine this matter before it becomes a major difficulty in our cities in regard to who covers cable television and in whom copyright is vested.

Inclusive of the amendments to be proposed by my colleague the hon member for Port Elizabeth Central regarding penalties and the time knowledge is presumed, I too have much pleasure in supporting this Bill.

Mr Speaker, I wish to thank all hon members who have taken part in the debate and I also wish to convey my appreciation to hon members for the trouble they have taken. This measure is a very technical one and arguments advanced in regard to specific matters can, in fact, be discussed to very good effect in the Committee Stage, when we shall be able to debate the specific provisions of each clause.

†I also want to thank the hon member for Port Elizabeth Central and his colleague, the hon member for Pinetown, for having supported this Bill on behalf of their party. Both hon members addressed themselves more specifically, among other things, to the question of the video industry. I shall be referring to this matter as well as to certain other matters that have been raised during my reply to this debate. I also want to say that I have taken note of certain comments made by the hon member for Port Elizabeth Central which I shall refer to the advisory committee.

I want to say that I doubt whether we shall ever be able to distinguish between the large and small operators to whom the hon member referred. I am advised that we have at present about 800 films that are registered. If a film such as Gandhi is distributed before it is officially released then, of course, these people will know who the owners of copyright are.

I am also advised that copyright in films expires after 50 years and not after 25 years. I think the hon member was referring to what he called the “golden oldie” films when he expressed the opinion that copyright expires after only 25 years. I am advised that it expires after 50 years.

As far as the proposed amendments of the hon member for Port Elizabeth Central are concerned, I shall refer to the amendment suggested by him to clause 10. I think that the amendment the hon member intends moving to clause 11 is one we should deal with at the Committee Stage because the hon member for Amanzimtoti has also indicated his intention to move an amendment to this clause at that stage in respect of the proviso to the proposed new section 27(6). I am looking forward to discussing these amendments because I have the feeling that the hon member for Port Elizabeth Central has made his decision whether or not to support the Bill at its later stages conditional upon my approach in this regard. I am inclined to think that it will be practicable to accept a maximum of R50 000, but I am not prepared to have the proviso to the clause deleted. I shall consider the intended amendment of the hon member for Amanzimtoti in terms of which the court is to be given a direction as to the time limit to prohibit a dealer to enter into such a practice again. I think the hon members will agree that we should debate clause 11 and the suggested amendments when we come to the Committee Stage.

As far as the suggested amendment to clause 10 is concerned, I should like to tell hon members that the reason for the existing words in the clause is to bring the legislation into line with procedures contained in section 6 of the Registration of Copyright in Cinematograph Films Act, 1977, read with the regulations prescribed in the Act.

In any event it should be noted that such applications are not published in the Gazette, but in the Patent Journal which is published on the last Wednesday of each month. In view of this, the hon member may reconsider his proposed amendment. It should be borne in mind that an application for registration of a copyright in a cinematograph film is advertised for general information in the Patent Journal and, if finally accepted, the registration will date back to the date of lodging the application. I think the hon member for Pinetown has specifically referred to this situation.

In reply to the hon member for Pinetown I believe that penalties in the United Kingdom and the USA have recently been stepped up considerably. This is my latest information on this issue.

*The hon member for East London City presented his apologies for not being able to be in the House at present. I want to thank him sincerely for his contribution. The hon member also discussed certain arguments advanced by the hon member for Port Elizabeth Central. He also referred in particular to the importance of having effective protection in regard to these matters.

Both the hon member for Brakpan and the hon member Mr Schutte referred to the importance of protecting the interests of the author and the owner of the copyright in order to promote creative work. I wish to associate myself wholeheartedly with this. It is true that the Copyright Advisory Committee—the hon member for Paarl also referred to this—is constantly investigating developments in this field and they try to propose timely, but also reasonable and fair, methods that will protect the rights of the creative artist or author.

The hon member for Brakpan also referred to indecent publications. The hon member was correct when he said that this is not a matter that falls under me or under the department. It relates to publication control. In the nature of the matter—the hon member may be assured of that—the Government is also concerned if indecent publications are printed and published. I think that the hon member may rest assured that that, too, is investigated. This is a matter that falls under the hon the Minister of Internal Affairs and I believe that the hon member will agree that this is a matter which he can raise in the course of the discussion of the Vote of the Minister in question. I thank the hon member for his support of the Bill, particularly because he and his party are of the opinion that the penalties should be increased in order to protect these rights.

I have already referred to the hon member Mr Schutte. I take pleasure in thanking him for his contribution, and in particular for the emphasis he laid on the question of the letting of pirated material and how this prejudices the rights of owners of copyright. I am grateful that the hon member has already discussed some of the arguments advanced by the official Opposition in this regard. I thank him for the trouble he took.

†I have already referred to the hon member for Amanzimtoti. I may just add that I will deal with his arguments relating to clause 11 in the Committee Stage. Unfortunately there are quite a number of film producers all over the world and therefore there is no list of all the films which are available. As the hon member has said, this does create a problem. I want to thank the hon member and his party for their support of the measure.

*The hon member for Paarl made a very interesting speech, and I thank him for his sound contribution. The hon member asked whether paintings and etchings would also be protected in terms of the measure, and my information is that such works will enjoy the same protection as any other literary or musical work of art as far as unpublished works are concerned. I am grateful that the hon member referred to this. I shall refer to the issue of illegal sound recordings made from records. The hon member stated a very valid point in this regard. He also referred to the valuable unpublished works in the Brenthurst Library. There was an article about this subject recently in Suid-Afrikaanse Oor sig. In the nature of the matter, there are very valuable unpublished works in university libraries and even, I believe, in the Parliamentary Library, and I think that it is only right that we should afford them the necessary protection by way of this measure.

The hon member for Paarl and other hon members referred to the question of illegal sound recordings, and I want to mention that according to date supplied to me, eight million blank cassette tapes were sold during 1983, equivalent to the capacity of approximately 12 million long-playing records. It is true that not all cassettes are used to record music, but it is calculated that in the USA approximately 75% of blank tapes that are purchased are used to record music. If that is the criterion, one could say that last year approximately nine million long-playing records were taped onto these cassettes. The question of sound recordings is dealt with in clause 7 of the Bill. When one looks at copyright, then on the one hand there are the creators of the works whose rights have to be taken into account, whereas on the other hand there are those who want to use the works. The users of the works may use them for their own purposes or for financial benefit. Therefore, to lay down in legislation provisions which will satisfy both sides is sometimes almost impossible. An effort must therefore be made to get the parties in question to reach agreement. The provisions in clause 7 are no exception. I have received representations on behalf of the creators of works and from the consumers. I therefore propose that clause 7 as it is worded in the Bill be accepted. I undertake not to put this clause into effect immediately and to afford the parties in question the opportunity to attempt, before the end of May 1984, to come to an agreement. If by that time they have not yet reached agreement, I shall decide, after considering the circumstances, what steps should be taken. I trust and should like to see that fairness will be upheld.

†The reason why it is proposed to increase and extend the penalties, is that through the tremendous development of technology it is becoming increasingly easier and cheaper to reproduce copies. It must be borne in mind that video shops can operate from any type of premises and no licence—I am advised— from a local authority is required to do business in this field with the result that it is extremely difficult to monitor their actions.

*There is a great deal of money at stake in these matters. The value of the rights is very considerable, but I am convinced that in this amending Bill we have a serious effort to do justice on a fair basis to those who are entitled to copyright.

Question agreed to.

Bill read a Second Time.

Mr Speaker, I move:

The main purpose of this legislation is to provide for the transfer of staff of the CSIR employed in the laboratory at the Richard’s Bay coal terminal to the staff of the SABS.

In terms of the Abolition of the Fuel Research Institute Act, 1983 (Act 30 of 1983), certain officers and employees of the FRI were transferred to the CSIR with effect from 1 April 1983. Since 1 July 1983, however, the SABS has been performing certain functions on behalf of the CSIR in the laboratory at the Richard’s Bay coal terminal, since those specific functions fall within the sphere of the SABS rather than the CSIR. Consequently, some members of staff of the CSIR were seconded to the SABS as from 1 July 1983, with ministerial approval. However, the Standards Act, 1982, does not provide the necessary statutory authorization for the transfer of those members of staff, and the amending Bill which is before us is intended to rectify that position. The employees involved have all indicated that they will be satisfied with such a transfer.

A further important amendment embodied in the Bill arises from the fact that serious concern is felt about the quality of canned meat and fish products for which or for the manufacture of which compulsory specifications are in force, which are packaged overseas and exported to the RSA. There is not always the same strict inspection of those overseas factories as there is in the case of South African factories. It is essential that such overseas factories be subjected to the same degree of strict inspection as the factories in this country. Provision is being made for this in clause 3 of the amending Bill. The clause provides that the council may enter into an agreement with any person who manufactures outside the Republic any commodity which is intended for importation and that provision may be made in that agreement for the council to appoint a person to examine the commodity itself or the process according to which it is manufactured. Inspection of factory premises will be arranged by the SABS by means of organizations in those export countries and a certificate of compliance will be issued. The Commissioner for Customs and Excise is consequently being empowered in clause 6 to cause such imported goods to be secured in any State warehouse or any other place until such a certificate of compliance has been obtained and submitted.

†It has been the bureau’s practice to incorporate by reference the provisions of certain foreign and international specifications eg those issued by BSI, ISO and IEC, in specifications etc issued by the bureau. The definitions incorporated in the 1982 Act prevent the continuation of this practice. The proposed amendment will restore the status quo and will make it unnecessary for the bureau to considerably revise a large number of existing specifications as necessitated by the 1982 definitions.

The addition to section 15(7)(a) contained in clause 5 clarifies a requirement of the bureau in regard to the interpretation of the existing section. It is a condition incorporated in all permits to manufactures authorizing the use of the standardization mark on a commodity that the manufacturer’s trademark or trade-name, as recorded with the bureau, should always appear in conjunction with the SABS standardization mark. The proposed amendment will ensure that a trader is similarly required to apply this requirement in connection with the sale of such a commodity.

Section 33 of the Standards Act permits the incorporation of any provision occurring in a standard specification, compulsory specification or code of practice to be incorporated in any law. The proposed amendment in clause 9 extends this provision to “specification” and “standard methods” as difined in the Act, but deletes “compulsory specification” as this is, in terms of section 16(1)(a) of the Act, derived from a specification or standard specification.

Owing to rapid technological advances and requirements in various fields of manufacture, more particularly in the automotive and electrical engineering industries, the proposed amendment will meet a requirement that was not immediately apparent when the principal Act was drafted. It will permit the fuller use of foreign or international specifications or methods in specifications or standard methods issued by the bureau and intended for incorporation in other legislation.

The proposed amendment in clause 10 extends the scope of section 35 to permit Government participation in any international convention or agreement having as its object the promotion of standardization.

It is expected that a need will develop for international compliance with mutually acceptable norms in the field of standardization, governed by international agreement. This will be particularly applicable to the im port/export market. The proposed amendment will enable the bureau to participate in, and if necessary administer, such developments subject to Government approval.

*Provision is also being made in the penultimate clause of the Bill for regulations to be made in respect of such agreements, since the implementation of and control over such a convention or agreement are normally provided for by way of regulation.

Mr Speaker, standard specifications, standard codes of practice and standard methods all oil the wheels of commerce and industry in any society. I do not think that the average man in the street is aware of the important role which these various standards play in smoothing his everyday life and in business and industry around him. I think that we in South Africa can rightly be proud of the role the SABS plays and the recognition it enjoys in this country and also in many other countries. I think that most consumers, when they see the SABS stamp on a product, realize that its presence means that they are able to buy that product with confidence.

When the original Act was passed in 1982, this party supported it, and we will also be supporting the legislation we have before us at present. The hon the Deputy Minister has gone into the details of the new provisions being introduced which make it easier for the bureau to perform its important task and function more effectively. The hon the Deputy Minister has covered all of these in some detail. We support the points he made and I think it is unnecessary for me to go over them all again today. We support the legislation.

Mr Speaker, we are grateful to hear that the hon member for Pietermaritzburg South and his party support the legislation.

It is always a pleasure to speak about the Bureau of Standards and its people, particularly since I myself worked with them for many years. There are a number of matters in this legislation with which one agrees. Firstly, I want to refer to the ISO, the BSI and the 1EC. The hon the Deputy Minister pointed out—and I agree with him—that the ISO, BSI and IEC standards which have been incorporated as references into the specifications and standards of the SABS should be left as they are, for two reasons.

Firstly, I think it is unproductive to rewrite such regulations and standards and, secondly, it serves as confirmation of the fact that, where necessary, the specifications of the SABS are in line with the specifications of international organizations such as the ISO, BSI and IEC. South Africa is a member of the International Standards Organization. Because it is to the benefit of all countries that there is world-wide standardization, we must not hesitate to say so straight out when we do so in South Africa. Therefore, when our specifications correspond with those standards, I think we should leave them as they are and use them or refer to them just as they are. It could only strengthen the image of the SABS if it can prove that it lays down standards that are equal to those standards laid down by the rest of the world. I do not think it is productive to rewrite an international standard in one’s own words. It would be just as foolish to rewrite Shakespeare as it would be to rewrite standards.

If one were to have a lapel pin in the form of a tortoise made according to SABS, ISO, BSI or IEC specifications, one could be sure that it would be a tortoise of quality. However, if one were to make the tortoise according to HNP, CP or AWB specifications, one must accept that it will be so poor that even the CP will not purchase it. [Interjections.]

In my opinion, the transfer of the staff of the CSIR at Richard’s Bay to the SABS is a logical step. I agree with the hon the Deputy Minister in this regard. The nature of the duties of these officials is linked to the quality control of coal which is shipped at Richard’s Bay on a daily basis. Their work is of such a high standard that they receive international recognition for it, and are accepted by the purchasers of South Africa’s coal as a quality control agency. Basically, their functions and daily task entail taking samples of coal on a continuous basis whilst it is being loaded onto ships. These samples are analysed immediately and inter alia, the moisture and ash content are determined. In this way, the price of every consignment of coal can be calculated rapidly and payment can be made quickly. There work is therefore in the interest of both South Africa and South Africa’s clients. If one takes into account that transport costs of export coal between South Africa and its clients could amount to an enormous sum, one can realize how important it is that high standards are maintained at the terminus where the coal is delivered, and that a system of quality control that can earn us a great deal of foreign exchange is in operation. The account for every consignment of coal that leaves the country can therefore be settled much quicker because the certificate issued by these officials guarantees the quality and grade of the consignment, according to which the client then arranges his payment immediately. I therefore think that adding these officials to the ranks of the SABS is going to strengthen the image of the Bureau of Standards. It is a reinforcement of that image of a guarantor of quality. That one would very much like the Bureau of Standards to retain and extend. We are grateful for the good work they are doing at Richard’s Bay. If we look at some of the other important clauses in this measure, I want to tell the hon the Deputy Minister that we share his concern about the quality of tinned fish and meat that are imported to South Africa. In view of the deaths that have occurred in Belgium as a result of botulism poisoning, one can only express praise and appreciation for the action of the officials of the SABS. Deaths as a result of this were prevented in South Africa by the vigilance of our officials. The deaths in Belgium as a result of botulism poisoning were caused by bacteria that developed as a result of unhygienic processes after salmon had already been tinned and packed. An indication of how important process inspections are is that this is being singled out and emphasized in this legislation. The SABS has always emphasized this, and we are therefore grateful that it is now contained in this legislation.

Because this incident took place in a country that exports salmon to all parts of the world on a large scale, it has once again become clear that one can never be too at ease, particularly about the quality of food which is supplied to a population on a large scale, regardless of who supplies it. Therefore, in my opinion it is vital that the SABS should approve processes that are followed in the export country and that they should be able to appoint someone to monitor the processes. We welcome this amendment, since it aims at safeguarding the health of our population. Perhaps the hon the Deputy Minister could just tell us who is going to pay for these inspections and the accompanying travelling expenses to the countries concerned. I do not think that the SABS should bear the costs. Perhaps this will also be to the disadvantage of a local supplier. This is not very important, however, as long as the SABS gives this the necessary attention.

We also find the extension of the provisions of section 35, as proposed in the amendment announced by the hon the Deputy Minister announced acceptable. It extends the provisions of this section in that it enables the SABS to perform a specific task in a foreign country when this will further the aims of the SABS and standardization. In view of the Nkomati Accord one can assume that the services of the SABS in Southern Africa will in future be needed increasingly for the promotion of standardization in this part of the world.

I also welcome the addition to section 15 of the principal Act proposed by the hon the Deputy Minister. On the one hand, I agree that the SABS mark should be propagated, but on the other hand, I have experience in practice of the manufacturer’s product being sold on the floor of the showroom by a salesman, someone who often wittingly or unwittingly abuses this mark for his own gain. In order to illustrate my concern clearly, I am going to use a practical example. A manufacturer of refrigerators acquires the SABS mark on two of his models, for example, on the 10 cubic foot refrigerator and the 10 cubic foot freezer. He can now display his trade mark together with the SABS mark. For the promotion of sales these two products are then usually displayed on the floor of a showroom, and those two symbols are printed on the same card and placed on the refrigerators. However, all the other refrigerators and freezers of the same manufacturer are also on the floor of the same showroom, although they do not carry the SABS mark. However, the impression could be created that those products carry the SABS mark too.

I think the SABS will have to be very vigilant in this regard and that they will perhaps have to tell the Consumer Council to keep an eye open so that the consumer is not taken in, and, of course, so that the SABS mark is not abused any further. I myself designed and tested products like this in my day. I also had the experience of a salesman who wanted to convince me to accept that one of the products I had designed myself was approved by the SABS whilst I knew that that was not the case. I think the public must continually be made aware that they must see the mark of the SABS on the product. That is why I absolutely insist that that mark should be made highly visible on every product. The public must not simply accept that all products that carry a certain trade mark can also lay claim to the quality mark of the SABS.

Mr Speaker, I take pleasure in supporting the present legislation.

Mr Speaker, hon members who have participated in the debate thus far have all spoken highly of the SABS. I think it is right and fitting that they have done so. The SABS is an institution that aims at pure and high standards in all respects. The bureau has a dedicated staff; people who know what they are doing.

It is also true that the SABS is situated in a special place, viz Pretoria; of course, in a special constituency as well. I assure hon members that that is a fantastic constituency. [Interjections.] The representative of that specific constituency in this House is not just an ordinary fellow either. He is a first-class man. [Interjections.]

He is just serving his notice.

I am very pleased that we are able to deal with this Bill today. In terms of clause 1 people who have worked for another body until now are being placed under the jurisdiction of the SABS. I think this is a sound method of rationalization.

Rather tell us about the bankrupt tortoise.

Mr Speaker, the hon member for Turffontein is speaking about a bankrupt tortoise. The most bankrupt tortoise I know is far wealthier than that hon member in every respect. [Interjections.]

The position is that the staff of the body to which I have already referred will in future work together with the staff of the SABS for a single institution. All matters relating to personnel … [Interjections.]

Order! Hon members must please not let a tortoise cause a stir in this House!

Mr Speaker, that is true. One tortoise is apparently causing a number of hon members opposite to start running. [Interjections.]

It is true that when certain staff matters are at issue, it is correct in every respect that all the staff involved should fall under a single body. I think that the procedure for which the legislation is now making provision will be complied with faithfully by all the bodies concerned, as in the past. However, because there is the feeling that statutory provision is being made for compliance with this procedure, it has been written into clause 2 of the Bill. We agree with this wholeheartedly. The staff now know precisely what is expected of them. This also includes the auditors. I think it is sound policy to do it this way. It is also sound procedure to give it statutory substance in this way.

Clause 4 and clause 9 really have a considerable amount in common. It is customary for the SABS to incorporate certain national and international specifications into their own internal specifications by way of reference. This is a sound procedure. A large number of discoveries are made overseas, and because countries communicate internationally, I think it is a good thing that unnecessary work can be eliminated in this way, both nationally and internationally. This could be done by people from different countries making use of one another’s specialized technical knowledge. For example, there are people who specialize in certain directions overseas, whilst others specialize in South Africa. This is a good thing, since knowledge can be exchanged in this way, and standards can be maintained at a high level. I think this will also lead to better co-operation between countries in the future. It could also lead to saving time and money and making additional energy available for research.

The hon member for Boksburg has already referred to the fact that certain goods are sold under the same name as that of the Bureau of Standards. I hope the day will come when everything sold in our country will have to comply with the highest standards demanded in this regard. The other day the hon member for Langlaagte pointed out to us how the public is being cheated as far as certain tinned foodstuffs are concerned in that more than half of the contents of the tins consist of water. We want this matter to be looked at and justice to be done to the public by seeing to it that the right amount of contents is contained in these tins. It is extremely important that the public should not be deceived or misled by being presented with a large tin which is supposed to be full of fruit, whilst when they get home they find that half of it is water. We could even make the tins smaller, but let us also see to it that those tins contain the right amount of that foodstuff. Since we are dealing with this legislation I want to request that we see to it that this direction of thought is pursued and that this aspect is worked on increasingly in the future.

The Bureau of Standards is a highly respected institution and it is therefore also fitting that the CP, which complies with the highest standards of any political party in all respects, should also support this legislation.

Mr Speaker, I want to thank the hon member for Sunnyside for having supported the legislation on behalf of his party. I shall not plague him any further by talking about tortoise standards and standard tortoises, therefore.

In 1981 I also had the opportunity of participating in the discussion of the principal Act which we are now amending. I find it gratifying to see that some of the amendments in this amending Bill are related to points raised by hon members during that debate.

It has already been pointed out that this legislation is of a technical nature, and many people will find its terminology difficult to comprehend. Mention is made, for example, of specifications, standard specifications, compulsory specifications, standardization marks, codes of practice, etc. I do not want to go into the definitions of these concepts, but I do want to say that all of us in this House must surely be in favour of the advantages of standardization, the general purpose of which is very simple. It is the promotion of the manufacture and consumption of and trade in commodities in one’s country as well as abroad.

This legislation is perfectly comprehensible if we bear in mind that standardization actually has two legs. The first leg includes the framing of specifications and codes of practice laying down the requirements for and characteristics of commodities and services. The second leg is ascertaining whether those commodities or services comply with the prescribed specifications. This is done by means of testing and selection, as well as by the introduction and auditing of quality management systems and certification schemes.

I should now like to refer to a few of the clauses of this legislation.

Clause 1 authorizes the transfer of 34 employees of the CSIR laboratory at Richards Bay to the staff establishment of the SABS. The conditions on which the employees may be transferred are also spelt out in this clause. This procedure is known to me, because I was in the service of the Atomic Energy Board myself in 1971, when the Uranium Enrichment Corporation was established and our entire Nuclear Engineering Division was transferred to the establishment of the Uranium Enrichment Corporation on similar conditions. It is not feasible to have members of staff resign in such a case, because that would mean an interruption in their service. In fact, I had the problem with one of my voters that she had resigned from the service of a certain Government institution in the early fifties and had joined another Government institution. She believed that she would enjoy the security of the continuity of pension benefits, but about 30 years later she found out that this was not the case, and by then it was too late to rectify the matter. As I say, the transfer is now being authorized by legislation. The clause makes it clear that conditions of service are retained and that the employees’ claims to allowances, bonuses, subsidies and so on are not affected. The clause also provides that their leave, pension and other benefits are assured. I take pleasure in supporting this clause.

Clause 2 deals with the utilization of funds. The clause envisages certain amendments to section 10. Section 10 only says where the SABS gets its funds from. It is interesting to bear in mind the fact that the SABS earns about 60% of its funds itself, while less than 40% of its funds are voted by Parliament. Section 10 also provides what the Council of the SABS may use its funds for, which budgeting procedures it should follow, etc.

The amendments contained in clause 2 are intended, among other things, to widen the proviso in connection with the spending of funds, to begin with. It also provides that funds voted for a certain purpose may also be used for a different purpose in order to achieve the objectives of the SABS. Clause 2 also lays down thé manner in which the annual report for a particular financial year is to be submitted to the Minister. Furthermore, it provides that the SABS may submit a statement of additional expenditure to the Minister at any time during the year. There is also a further extension which I support. It concerns the exceeding of approved expenditure. It is now being laid down very clearly in the legislation that the council may not exceed the total amount that has been approved. We are giving the council freedom of movement within the limits of its budget, therefore, but we are making it very clear that the budget may not be exceeded. It is very important that Government institutions should not exceed their budgets. Therefore I support these additions as well.

Section 12 of the principal Act is being amended by clause 3. We are concerned here with an extension in the sense that agreements with foreign countries and organizations are also being made possible. In actual fact, the SABS would have been able to do this in terms of section 12(1), because this is a fairly wide provision in terms of which the SABS may do anything which will contribute to achieving the objects of the bureau. It is already allowed to do this, therefore, but specific provision is now being made in the legislation for the SABS to conclude contracts with foreign governments or companies. This is essential, for several reasons, but I want to refer to only one. There is a very big difference between a specification for a commodity, when one tests the end product, and a specification for the manufacture of that commodity. This applies in particular to food and the canning of food. The problem experienced with the importation of salmon from the USA—this is dealt with in the 1982 annual report of the SABS—was in fact that the end product, the tin of fish which arrives in the harbour, seems to comply with the requirements, but when the fish in that tin has been tested, one does not know what the condition of that fish is going to be in, say, two months’ time, if one has not been provided with specifications regarding the whole process of manufacture. The clause now enables the SABS to enter into an agreement with an organization which intends to export such a commodity to the Republic of South Africa, precisely in order to monitor certain tests and quality management systems in the country of manufacture. In the case of the fish—the hon member for Boksburg referred to this— there was a very small imperfection in the seam of the can, and after a lengthy period this led to food posioning.

Clause 4 amends section 13 of the principal Act to facilitate reference to specifications of international bodies. In many professions, reference to international standards are common practice today. In the case of concrete design in the engineering profession, for example, a civil engineer only has to say that that the concrete design complies with the requirements of the American Concrete Society, and everyone will know which set of specifications this is. The mere reference makes it unnecessary to repeat all the specifications. Clause 4 facilitates reference to standard specifications and other specifications used abroad.

The hon member for Boksburg dealt with clause 5. It concerns the advertising of a commodity by a trader, and requires him to mention or display the trade name or trade mark of the commodity.

Clause 6 amends section 17 of the principal Act and basically provides for the deletion of the provision in terms of which imported goods have to be stored in a State warehouse at the place of entry for testing by the SABS. The amended section now enables the Commissioner for Customs and Excise to store goods in a place other than a State warehouse. Nor does it have to be at the place of entry, at a harbour or border post, for example. One gladly supports this greater latitude which is being given to the Commissioner for Customs and Excise and to the SABS.

Clause 7 amends section 18 of the principal Act. This article deals with codes of practice. Once again, it simply authorizes the SABS, in framing its codes of practice, to refer to a foreign or international code of practice.

Clause 8 amends section 17 of the principal Act. This deals with the standard methods and links up with amendments in the preceding clauses. It enables the relevant bodies to refer to specifications, codes of practice or standard methods of foreign or international bodies.

Clause 9 replaces section 33 of the principal Act. It is a very lengthy section which covers three pages. However, the amendments are only concerned with corrections and improvements to the existing Act. The concept of “compulsory specification” is derived from the concepts of “specification” and “standard specification”. The reference to “compulsory specification” is now being omitted, while the term “specification” is being inserted. It is no longer necessary to identify a specification by reference to its number, and any other means of identification will be acceptable.

Clause 10 amends section 35 of the principal Act and deals with co-operation with foreign governments and bodies, and once again, this amendment is consequent upon amendments in preceding clauses. It is aimed at promoting the international trade in commodities and makes it possible to perform certain actions abroad with a view to the promotion of standardization.

Clause 11 amends section 36 of the principal Act by inserting subsection (1)(g). Section 36 deals with regulations, and here we are now authorizing the SABS to make regulations for the performance of its functions in implementing as agreement with a foreign power or organization.

I take pleasure in supporting the Bill.

Mr Speaker, the hon member for Pretoria East mentioned that this is a Bill of a technical nature which is designed to further the activities of the SABS, especially in its relationship with markets in other countries and the importation of goods from the other countries. As such the NRP will be supporting this Bill.

The hon the Deputy Minister referred in his introductory speech to clause 2 and I think the hon member for Pretoria East was the only other member who referred to this clause which concerns the budget of the SABS. The clause clearly states that in each financial year, before or on a set date, the council must submit a statement. In the proposed new subsection (3)(a)(ii) it is provided that the council may submit a supplementary statement of additional expenditure, and in the new subsection (3)(b) it is provided that the council shall not incur expenses which may result in the total amount approved under paragraph (a) being exceeded. This virtually implies that the council, having submitted as it has in the past its estimated income and expenditure account or budget, for the year may now—as we in Parliament have with the SATS budget and the main Budget—submit an additional budget. I had to smile when I read the proposed subsection (3)(b) which reads:

When the additional estimates are submitted, the council will already have decided how much it will overspend so the die will have already been cast. I do not know therefore why it is stated that they shall not incur expenses in excess of that amount because it will already be so late in the financial year and the additional estimates will only be covering up for the overexpenditure. We know the hon the Minister of Finance does this every year. I can assure the hon member for Pretoria East that we would prefer the hon the Deputy Minister to give us an assurance that there would be a tighter rein on expenditure.

Having said that, it was interesting to hear the hon member say that 60% of the funds expended by the council come from own sources; in other words income which is generated by the council itself. Only 40% comes from the State. This is an interesting clause and I suppose it tidies up the financial aspects of the SABS, but to my way of thinking it does not really mean very much as far as budgetary control is concerned.

There are only two other clauses which do not concern international trade, namely clause 1 which provides for the transfer of staff from the CSIR to the SABS and clause 5 which requires that a trader, when advertising goods which have been given an SABS mark—the manufacturer also has to do this—has to display in his advertisement his trade name or trade mark. The other eight clauses all concern international trade and standards and are intended to promote the very important aspect of the import and export market between South Africa and its trading partners.

I believe that these amendments are very logical as there should be to a very large measure an international compliance as far as standards are concerned. These amending clauses will allow this to happen and there will be compliance with mutually accepted norms in the field of standardization governed by international agreements. This is logical because it prevents duplication of effort and therefore has certain economic advantages. It would be silly to duplicate the effort that has already been extended in other countries. It will also lead to better co-ordination internationally as regards the manufacture of certain goods.

For these reasons we feel this is a step forward and that is why we believe the Bill is worthy of support.

Mr Speaker, I should like to thank the hon member for Amanzimtoti for indicating that his party will support the Bill.

*One must obviously support this amending Bill if one has the right approach to a matter of this nature, because the amendments contained in the various clauses of the Bill are aimed at making satisfactory practical arrangements. These are not just theoretical provisions, therefore; they will bring about specific benefits in the performance of the task of this important scientific organization which has to guard over the standards, quality and specifications of commodities. The quality and standards of commodities and services are certainly of great interest to the general public and specifically to the consumers of such commodities. The quality of manufactured articles is related to the durability and effective use of such articles. The SABS mark also holds advantages for commerce, of course, including the manufacturers and distributors of a particular commodity.

Hon members have already discussed the clauses of the amending Bill in detail, so instead of referring to the separate clauses, I shall discuss the general activities of the SABS, which is one of the important scientific organizations whose activities are of great importance, not only in the field of commerce, but also with regard to the standards and quality of commodities examined by them. The principal objects of the SABS may be summarized as follows: to promote standardization; to draw up specifications and codes of practice; to provide testing facilities; to administer quality certification schemes, by placing the SABS mark on products, for example; to render assistance with regard to standardization to the State, public bodies and private organizations; to promote the introduction of quality management systems; and to supply reference material.

In order to achieve these objects, the organization is composed as follows: A staff of almost 1 200, more than 700 of whom are highly qualified scientists and technicians; regional and branch officers in all the major industrial centres of South Africa and in South West; 60 main laboratories which are equipped with testing equipment with which virtually any product under the sun can be tested and which has a replacement value of almost R26 million; almost 1 100 standard specifications, more than 1 500 private specifications, 500 co-ordinating specifications for bulk buyers such as State departments, 200 codes of practice and 1 000 standard methods which have been framed; the close co-operation of all sectors of South African industry, which is represented on more than 500 technical committees which are concerned with the preparation of national and international specifications and codes of practice; and four quality certification mark schemes. When one analyses the impressive composition of this organization, one realizes that it is a major enterprise, and for this reason, it performs a special task which is greatly appreciated. It is unlikely that it would have been possible without the SABS to keep the standards of industrial products and other commodities manufactured in this country at such a high level. It is also important that when goods are exported, the standard of such goods should be such that when importers abroad receive commodities bearing the mark of the SABS, they may be reassured as to the quality of the articles concerned.

While the SABS usually operates to the advantage of those who market articles, since the SABS mark is a recommendation for the seller, there are cases, however, where persons marketing an article are obliged to obtain a permit from the SABS before the article may be sold. This is the so-called compulsory specification to which hon members have referred. In these cases, there is a law or ordinance providing that such an article may not be used if it does not bear the SABS mark. An article is only granted the SABS mark after a permit has been issued in which it is stated that the article complies with certain standards and requirements. I want to plead that where people are obliged to obtain such a permit, the decision should not be delayed unnecessarily. One realizes that the SABS has to conduct the necessary examination and that scientific tests may naturally take a long time, but I do want to make a serious request in this connection. I believe that the hon the Deputy Minister will understand why I am making these representations. I do not wish to refer to the details of specific cases. I do not think this is the place to do so. However, I want to request the hon the Minister to ensure that when manufacturers of articles are obliged to obtain a permit from the SABS, because this is required by a law or ordinance, the SABS will give sympathetic consideration to their applications and will deal with them as soon as possible.

A delay in the process has certain adverse consequences. The general public is deprived of the use of an improved product or denied it for a long time. If there is a manufacturer who is able to market a product which is an improvement on the existing article and he cannot obtain the necessary permit, it is possible that the public may be unable to obtain the better product for a year or two. This may also give rise to monopolistic trade practices. If the company which is already marketing an article is given the opportunity, especially where sales of the product are so high that they run into hundreds of millions of rands every year, they are placed in a favourable position because potential competitors are prevented from marketing the product. The manufacturer himself may suffer losses and be discouraged as a result of lengthy delays. As a result, entrants to the market may be discouraged. If a person wants to manufacture a specific article and he knows that he will have to wait two or three years before being able to obtain a permit, because the law applicable to that article provides that it may not be marketed or used before it has received the SABS mark, such a person is discouraged. If one has to invest large amounts of money in a factory or equipment for manufacturing a certain article, and one knows that one may have to pay the interest on that money over a long period before being able to market the article, this is bound to discourage one from entering the market for articles which have to bear SABS mark. I am not suggesting that the SABS is causing unnecessary delays with regard to these cases. However, there are two ways of doing something: One can do it immediately or one can do it when it suits one.

Mr Speaker, in the first instance I should like to thank the hon member for Pietermaritzburg South for his contribution and support of the Bill, also for his kind remarks about the SABS.

*I should like to thank the hon member for Boksburg for his support and for covering quite a wide field here this afternoon. The hon member touched upon specific aspects which I want to refer to briefly. He referred to the carrying out of inspections in terms of clause 3. It is deemed essential that the overseas factories in which meat, fish and other products are manufactured, should be subject to the same strict inspections as those to which our own factories are subject. Inspection of these factory premises will be done by means of organizations in the export countries concerned, on behalf of the SABS. A certificate will have to be issued to the effect that the requirements have been complied with, and the Commissioner of Customs and Excise is being authorized to hold such important commodities in a State warehouse or elsewhere until such certificate is submitted, after which the products may be released.

The hon member raised an important aspect in connection with clause 5. I view this matter in a serious light and I shall refer it to the SABS for the necessary attention, to make certain that no malpractices occur in this respect.

The hon member for Sunnyside also gave this measure his support, and the support of his party. The hon member said inter alia that the SABS was situated in the best constituency, but I want to tell him that the Sunnyside constituency is not a standard CP constituency. Actually it is a standard NP constituency. It belongs to the CP temporarily.

What about Klerksdorp?

Mr Speaker, the hon member for Kuruman is the last person who should concern himself about a constituency, except perhaps his own.

Just wait, we shall see what happens in Klerksdorp. [Interjections.]

Mr Speaker, the hon member is a person who can only make standard interjections. He never really comes to light with original interjections.

Amie, do you not want to challenge me?

No, I am not challenging anybody. All I am saying is that the hon member has already missed the boat in his constituency. [Interjections.] It is quite clear that the hon member for Kuruman is at present looking for a seat, Mr Speaker. Naturally that proves, I think, that he does not feel safe in his own seat. [Interjections.]

I want to thank the hon member for Sunnyside for his support for this legislation, as well as for pointing out what an excellent organization the SABS is. I also took cognizance of the remarks the hon member made in his argument to the effect that he would like to see more products having to comply with the requirements laid down by the SABS before being made available to the public.

The hon member for Pretoria East is a person who spoke with knowledge and expertise on this subject. In the past, too, the hon member has made good contributions in this respect, and I should therefore like to thank him for the trouble he took. The hon member is exceptionally well acquainted with the activities of the SABS, and I am also grateful for his remarks on the quality of the work being done by the SABS.

†The hon member for Amanzimtoti referred to clause 2 of the Bill. Before returning to that, however, I should first want to thank the hon member for the support of this Bill expressed by him on behalf of the NRP.

As I read clause 2 of the Bill, which is aimed at amending section 10 of the principal Act, it appears that the new subsection (3)(a) includes firstly the statement of the estimated income and expenditure during the next financial year, and secondly, states that the council—

Then, in the proposed new subsection (3)(b) it states:

That includes both. Therefore I think the problem raised by the hon member for Amanzimtoti is taken care of. If that should not be so the hon member is most welcome to make further representations to me in this regard. In any event the aim is that the total amount approved should not be exceeded, either during a particular financial year or by way of additional financial requirements.

*The hon member for Welkom also made a contribution here this afternoon, for which I should like to thank him. In particular the hon member referred to the importance of the SABS to commerce and industry. Moreover, he gave us a clear sketch of the task of the SABS. I have appreciation for the problems which the hon member raised here this afternoon. Since the marketer of specific products has to acquire compulsory specifications—he must, as the hon member said, obtain a permit—certain problems do crop up, which I appreciate. There are specific prescribed requirements, modus operandi and procedures that have to be complied with.

However, I agree with the hon member for Welkom when he said that there should not be any unnecessary delays. Consequently I should like to give further attention to the request which the hon member addressed this afternoon, and also to the possibility of rationalizing these procedures. I should like to thank the hon member for his contributions.

Question agreed to.

Bill read a Second Time.

Bill not committed.

Third Reading

Mr Speaker, I move, subject to Standing Order No 56:

Mr Speaker, I am very glad that we are now on the point of finalizing this legislation. I just want to ask the hon the Deputy Minister whether he could possibly arrange for the study groups of all the parties in this House to pay a visit to the Bureau of Standards. Unknown, unloved, as the saying goes, and I believe that the more hon members get acquainted with the activities and the functions of the Bureau of Standards, the better it will be for us all. I may just mention that the previous Minister of Posts and Telecommunications arranged the same kind of visit to the Post Office about two years ago. The hon the Minister will probably remember that we ended the evening in Sunnyside on top of the hill and that all the members went into raptures about the constituency and the beautiful environment. As far as Sunnyside is concerned, we should also like to offer this to the hon members of the various study groups.

Mr Speaker, I want to thank the hon member for Sunnyside for his remarks, because I agree with him in this connection. I was privileged to visit the Bureau again in October last year, and I believe that it is an organization which is very much worth visiting. I should like to give further attention to the hon member’s request in order to enable hon members to visit the Bureau of Standards. I believe that hon members could indeed find this a most fruitful visit.

Question agreed to.

Bill read a Third Time.

Mr Speaker, I move:

In terms of the Industrial Development Act, 1940, the objects to the Industrial Development Corporation of South Africa, Limited, as defined in the Act, shall be achieved “to the end that the economic requirements of the Republic (of South Africa) may be met and industrial development within the Republic may be planned, expedited and conducted on sound business principles”.

Before the Transkei, Bophuthatswana, Venda and the Ciskei became independent, they formed part of the territory of the Republic of South Africa, and at the time there was no impediment in law to the IDC achieving its objects in those territories as well. Since the TBVC countries became independent, however, the position has changed, and the IDC is no longer legally able to operate in these countries and render possible assistance to industrial undertakings there. Financial support by the IDC and its subsidiaries in the TBVC countries also fall outside the scope of the provisions of the present Act, as does the corporation’s task of providing housing for key White personnel employed in factories in the independent national states.

†These restrictions are not in accordance with the principles of the Industrial Development Proposals released by the hon the Prime Minister at the Good Hope Conference on 12 November 1981. In these proposals much more emphasis than previously was placed on the interstate nature of regional development; in other words, that economic development cannot take place only within a country’s borders but transcends international boundaries. In terms of the proposals it is, therefore, the endeavour to promote economic development in Southern Africa to the maximum benefit of all the states concerned. Consequently, the purpose of the Bill is, among others, to amend the Industrial Development Act, 1940, with a view to enabling the Industrial Development Corporation to operate in the whole territory which comprised the Republic of South Africa prior to the TBVC states attaining independence. The amendment in this respect is contained in clause 3 of the Bill and provides that the IDC may, with the concurrence of the Minister, enter into an agreement with the Government of any state, the territory of which was formerly part of the Republic of South Africa, in order to perform any function which the IDC could have performed in the Republic in terms of the principal Act.

*The Industrial Development Act, 1940, also does not authorize the IDC to make direct loans in respect of industrial support to individuals or partnerships. In certain cases loans are made to individuals when an industrial activity is performed on a informal basis and no formal company therefore exists. In addition, when the corporation grants loans in respect of housing to key personnel, it is necessary that the loans may be made to individuals. This is an existing practice on the part of the IDC, but because no specific provision was made for this in the Act the loan always had to be channeled through a subsidiary of the IDC in the past. From an accounting and technical point of view, however, this channelization is not an entirely satisfactory modus operandi, and in the measure contained in clause 2 of the Bill the IDC is now being specifically empowered to grant loans directly to individuals and companies.

Sir, if you will permit me, I should like to avail myself of this opportunity to thank the general management and the staff of the IDC sincerely for the continuing service which they have rendered in respect of the promotion of industrial development in particular and economic development in general in Southern Africa.

Mr Speaker, the official Opposition will be supporting the Bill. Clause 3 provides for a new section in the principal Act to empower the Industrial Development Corporation, as the hon the Minister has said, to enter into agreements with governments of territories which were previously part of the Republic of South Africa whereby the IDC can perform any function which it can perform in the Republic in those areas.

We should just like to clear the decks so that we can all see where we stand. The official Opposition, unlike the Government, has no trouble whatsoever with this concept. It opposed the excision of these states from the South African body politic and has never regarded them as other than integral parts of the Republic. The Government has belatedly admitted that they are now forming one economic entity with the Republic, and eventually it will have to go through a long and uncomfortable period before coming to terms with the fact that politically these states also are part of one political economy with the Republic. [Interjections.] This little Bill is just another illustration of that fact.

By no stretch of the imagination can one conceive that states so completely dependent upon the Republic are not also politically part of the same entity, and at some stage it will be necessary to recognize this with some new political dispensation for the whole of this group of states at the bottom of Africa. Nothing illustrates this more clearly than the system of communal land tenure in those areas. This lies at the root of considerations such as whether these countries can feed themselves, how many people they can support and how many people we must support. There is also the question of the security of the ecology of the whole area.

The Bill before the House is an indication that we are one indivisible economic entity here at the southern end of Africa, and it will be impossible not te recognize our mutual political responsibility in some common political structures. The request that the IDC be allowed to operate in these independent states is proof that we share a responsibility for their welfare. In the Bill it is stated that the IDC requires these powers:

We are supporting the Bill because it entitles the IDC to perform those functions which it is entitled to perform in the Republic, also in those independent states. We are not supporting pit so that it can be hijacked as an additional instrument to bring about industrial decentralization for ideological purposes.

The Act in terms of which the IDC was established by the Smuts Government in 1940 gives very clear rules by which it is to be conducted. Section 3 of that Act provides that the objects of the IDC are to establish and conduct an industry or undertaking, to facilitate, promote, guide and assist in the financing of new industries and industrial undertakings or scheme for the expansion of existing undertakings. Section 4 sets out its powers in order to attain its objectives and section 5(a) states that:

It is because the Bill does not depart from this “grondwet” of the IDC but only ensures that it can operate in the independent states as well as in the Republic that the official Opposition can support it. We have the gravest forebodings about the effect of decentralization for ideological reasons. We are concerned that the Government will, and to a degree has already, involved the IDC in industries, in industrial or other schemes, in a manner which is ultra vires in terms of its Act. One must always bear in mind that it is supposed to embark on projects of this nature on economic merit irrespective of any other considerations whatsoever. Nothing illustrates the degree to which the IDC has lost its way more clearly than a glance at its most recent annual report. There one reads the following:

If there was ever a shocking example of comparing apples and pears to confuse the innocent, this is it. The report of the IDC compares incentives granted in the first year of the new incentive package with total transport subsidization of passenger rail services to all the major metropolitan areas in the country, where almost the entire South African industrial labour force works. Commuter traffic carried out by the SATS in these areas alone amounted to something like 680 million journeys, and for some reason or other this is compared with the incentives given under the decentralization scheme. Two completely unlike things are compared for no logical purpose whatsoever other that to confuse. Half-baked statements like these are unworthy of an organization which has a very proud record which extends over four decades. We believe that the hon the Minister must clearly state what his purpose is with the IDC. Are we seeing a change of purpose in respect of the corporation? When one looks at its annual report, one can have doubts about this. It states:

I very much doubt whether that is a legitimate function of the IDC. It is supposed to involve itself in new projects on economic merits alone without any other consideration whatsoever. The hon the Minister should tell us whether it is proposed to create a role for the IDC in the independent Black states which will involve it in the development of industries for other than economic reasons. If it is, I can promise that it will do very little better than some of the other national development corporations.

Here I want to tell a story because it indicates the type of danger which arises when one does not give an organization straightforward and simple objectives like the IDC was given in its original charter. It was to go into projects on economic merit and without any other consideration whatsoever. This is a story concerning decentralized industry and the type of thing one would not like the IDC to be involved in.

It is the story of three companies, namely Thrustor Manufacturing Industries (Pty) Ltd, Thrustor Industrial Products (Pty) Ltd and Thrustor (Pty) Ltd. This came to light because in April 1983 Thrustor Manufacturing Industries initiated steps to make a compromise with its concurrent creditors of 3 cents in the rand. The function of the company Thrustor is unknown although it is quite an interesting company. Its financial accounts of 1982 show that it made a loss of R301 000 on a turnover of R35 000. It was insolvent and its liabilities exceeded its assets by R383 000.

Was it a farming operation?

It could have been. Thrustor Manufacturing Industries had a factory in the Transvaal and two in Ciskei. It had the immense share capital of only R120. It had a loan from Thrustor Industrial Products of R660 000, from the Economic Development Corporation a loan of R963 000, and another R250 000 from the Ciskei National Development Corporation. The loan from the CNDC was on condition that it increased its capital of R120 by R100 000. It never did that but it still got the loan despite the fact that it had unpaid rent to the extent of R120 000 in May 1983. Trading losses as at 28 June 1983 amounted to R1 360 000. At the time they admitted further losses of R800 000.

This is the kind of thing that happens when one does not give an organization clear-cut goals. The people who supported this factory and had it established did so because they were confused. They believed that they were supporting some kind of socio-political programme which had been decided was for some or other reason good. They were confused and never looked at the figures or the facts.

In May 1983 the liabilities exceeded the assets by more than R2 million. The 1983 balance sheet shows some interesting assets. It shows an aeroplane worth R170 000 and patterns to the value of R200 000. Those patterns are for the making of overalls and are available free from anybody who supplies the material. Other assets they had was the loan of R237 000 which they had made to Thrustor, the company that was completely insolvent. During the compromise there was an admission that to raise funds while insolvent, false invoices had been factored to the extent of R800 000. What I cannot understand is how the CNDC could have made a loan of R250 000 to this company in November 1982 as they were aware at that time that the company had not paid any rent for six months and that the company was operating on a trading loss of R100 000 per month. I have private information that this loan was made after an investigation of the company by the CNDC. [Interjections.]

A further strange matter is that the CNDC voted in favour of the compromise when the compromise for this extraordinary company was 3 cents in the rand. This of course meant that they were then involved in the support of this company in the following period. The TMI business was tendering for South African public bodies, Army uniforms, Police uniforms, overalls and protective clothing. It must be remembered that in the year in which the company made a loss of R360 000 it received a labour subsidy of R650 000. [Interjections.] It is a swindle.

What causes such a situation to arise? It is caused when people who have to run organizations are confused by a complicated set of goals. The IDC is an organization with too successful and proud a record to be so confused. When one looks at its constitution, one sees very, very clearly that it has to make its judgements on economic merit and not on any other consideration whatsoever. I have a very serious fear that that approach is changing fast. [Interjections.] The hon the Minister must tell us whether he envisages the IDC taking over any of the functions now carried out by the Economic Development Corporation the CNDC or any other similar corporation. If so, why, and what is the attitude of the governments of those states to such a take-over? He must also tell us whether the Government has lost faith in the ability of the Economic Development Corporation and the various national corporations to promote industrial development in those decentralized areas. Does he intend to divert the IDC from the object set out so clearly in the Act? If so, I believe he has an obligation to bring that matter to the House so that it can be properly debated.

I have little doubt that one of the reasons why we have this Bill before us is that we are being asked to regularize a situation that already exists. Contrary to the provisions of its constitution, the IDC is already involved in certain independent Black states. Peculiarly enough, it is not this aspect of the matter that is my main concern. My concern is to ensure that the corporation does not become usurped by the Government as an instrument for implementing the ideologically inspired decentralization of industries without the matter first being debated in this House.

Despite our reservations concerning the Government’s intentions and because the Bill gives the Industrial Development Corporation no powers not contained in the existing Act except for an extension of the area over which it can operate, with which we agree, we will support the measure.

Mr Speaker, I want to thank the hon member for Walmer for the fact that despite all his objections, he supports the Bill on behalf of his party. I also wish to say to him that it is possible to have two kinds of independence, namely political independence and economic independence. The Government has never said that all countries in Southern Africa are not economically linked with one another in a fashion. In the two conferences arranged by the Government, namely the Carlton conference and the Good Hope conference, it was very clear that the Government was deliberately setting out to promote decentralization, not only with regard to those parts that fall under the present Government of South Africa, but also with regard to all people in Southern Africa. I want to say to the hon member for Walmer that the finest example of where the two kinds of independence work is the case of the European Economic Community. There is no question but that the European Economic Community is independent in the political sphere. I have never heard that France and England agree on everything in the political sphere; on the contrary, nowadays they differ fairly regularly. The political aspect is one side of the matter. The other side is the economic aspect, and there they have the EEC, and in that, too, there are at present mutual differences as regards an agricultural policy. However, they have been co-operating since 1958 and this has given rise to great prosperity for Western Europe. The original total of six member countries has grown to ten, and Spain and Greece are also on the point of being admitted. When that happens the membership will have doubled.

Therefore, to come here and loudly contend that the Government is bringing about political decentralization is to present a somewhat distorted picture of this legislation. The hon the Minister explained very clearly what the three clauses are about. The hon member for Walmer also discussed that. [Interjections.] The hon member discussed the political part of it and indicated that there were certain aspects with which he did not agree. I agree with him that the example used in the annual report with regard to decentralization benefits and what is spent on housing and transport in the form of subsidies, is not entirely correct. In fact I do not believe that the two have anything to do with one another. I believe that the hon the Minister will furnish a clear reply as regards the specific example quoted. However, I want to say to the hon member for Walmer that every bank and every lender of money daily encounter people who are out to hoodwink them, as this firm has in fact done. Simply to link this to the IDC and certain development corporations is going a bit far. Everyone will pay a price. The hon member for Walmer, too, a very big businessman, has made rotten investments in the course of his life. Therefore we must recognize that this can happen. We have both made poor investments. We accept that as part of the risk a businessman must be prepared to accept. He will agree with me that there is not much difference of opinion on that score, viz that every now and again we have a rotten egg in the basket. I believe that the hon the Minister will explain that rotten egg to him.

I want to proceed where the hon member left off and convey my congratulations, too, to the IDC which will in a few years time commemorate its fiftieth anniversary. We must honour the IDC for the exceptional development they have brought about in the country. This corporation serves as a mobilizer of risk capital for the establishment of essential industries in the Republic. It has been undertaking this task since 1940. The latest annual report of the corporation shows very clearly what has been achieved—it provides a full exposition. I do not wish to go into that in detail at this point but I do just want to refer briefly to the provision of capital for new and existing industries. One point that is often forgotten is that the IDC also provides further assistance for existing industries if they require money. This is another reason why the Act is being amended, viz so that existing enterprises financed by the IDC in those countries which use to form part of South Africa and later became independent may expand further, rather than have their aid summarily cut off on independence. This takes place in both urban and decentralized areas. Therefore the IDC furnishes assistance across a broad spectrum and differs somewhat in this respect from the economic development corporations of the various states—I shall call them “national corporations” which undertake economic development there.

The objectives of the IDC are very clearly expounded in the legislation. One can sum them up in a few important points. The first objective is the establishment of industries in the Republic, in other words, the provision of employment. Then, too, the IDC has a special interest in the development and encouragement of exports. One of South Africa’s biggest problems is always how we can compete on the world market. Dr Kleu’s report on industrial strategy in South Africa devoted a great deal of attention to this matter. I believe that the extension and implementation of the recommendations contained in the Kleu report could in future contribute to a large extent in assisting the IDC, too, to perform its function more fully. Another aspect I wish to mention is the increase in the amount of local material used in products. However, I shall come back to that later.

The establishment of high technology industries is of great importance to us. This is an aspect to which South Africa will have to devote urgent attention. We shall also have to strive to do more than merely continue importing technology, because technology is and remains the watchword for international competition.

The IDC is engaged in the modernization of enterprises in order to keep abreast of the changing demand and competitive climate. Here I have in mind in particular the new trend of modern products which is associated with the aforegoing.

An important point we must bear in mind is that the IDC does not become involved in the day-to-day management of an enterprise. I believe that this is wise, because as soon as it becomes involved in that its independent judgment will be jeopardized. This, indeed, is what has happened with regard to certain development corporations in South Africa because they have not drawn a clear distinction between the function of financier and that of manager. As soon as these two functions are combined it creates a problem which may be insoluble, viz that of total independence in assessing whether or not it is justified on merit to invest. However, I want to give the assurance that the skills possessed by the IDC do not pass unnoticed but that South Africa as well as the homelands, and also the independent Black States, are fully cognisant of them. Indeed, they are known beyond the borders of Southern Africa and accordingly we ought to thank the IDC for the skills they have developed. We therefore also trust that they will continue to be made available to everyone who asks for them. If we continue to achieve further successes in South Africa I hope that the hon the Minister will see his way clear to making his skills available to South Africa’s neighbouring countries as well because this will benefit both South Africa and those countries.

Since this legislation is chiefly concerned with continuing industrial financing I should also like to refer to what the IDC has done in respect of industrial financing. Since 1940 the IDC has assisted in the creation of more than 300 000 job opportunities. This represents approximately 20% of all job opportunities created in industries in South Africa. Approximately 3 000 industries are involved here, the project financing of which was conducted by the IDC. According to the latest balance sheet the total assets as at 30 June 1983 amount to approximately R2 200 million. This gives one some idea of the extent of the financing projects of the IDC. During the weekend we read in the newspapers who controls the separate undertakings in a major enterprise, and taking into account the fact that the assets of the IDC amount to R2 200 million, it is clear that this, too, is a first-rate undertaking. Apart from that large sum the IDC also maintains a balance-sheet structure better than is required by private initiative, for example banks. At present 62% of its total assets are financed by self-generated funds or shareholder funds. In my opinion this is an exceptionally good figure if one takes into account the fact that the norm that every entrepreneur usually tries to maintain is one of 50:50 between self-generated and outside capital. At present the IDC is maintaining this ratio at 62% to 38%, and as far as the analysis of financial relations is concerned, it is clear that this company is outstanding, or as good as the best in South Africa. I want to say to the hon member for Walmer that we do sometimes encounter a rotten egg, as he indicated in his speech, but this is only an isolated incident, as is evident from the balance sheet to which I have just referred.

An interesting statistic is the one relating to how the IDC has allocated its support in the past. In this regard I want to quote once again the figures provided by the IDC. The IDC distributes its money among certain fields of development and the level of financing is used as a norm in respect of total factory production. In the Western Cape the IDC invested almost 25% of its money as financier as against the production capacity of this area of 13%. In the Eastern Cape the IDC invested almost 15% as against a factory production of 8%. In the PWV area, however, it has invested only about 23%, as against a factory production of more than 55%. This gives us a clear indication that the IDC is deliberately seeking to promote the aim for which it was established. The figures mentioned confirm this. They also confirm the fact that it is achieving its set goals.

South Africa is in danger of ultimately being smothered by its industrial development in the cities. This is something we have often discussed. The whole concept of decentralization and everything that it entails has often been discussed in this House. I do not wish to cross swords further with the hon member for Walmer today, because I think that we two could fruitfully discuss this problem. However, it is true that decentralization is not a simple process. Neither is it cheap or popular. We had better accept that. This is a factor in these steps we have to take to provide job opportunities in the areas away from our cities, because in the long run the economic costs will be so much higher if we begin adding up the social cost per job opportunity in the cities. It is true that the IDC has succeeded in creating job opportunities in areas outside the cities. The hand of the IDC can be seen in a large number of important projects in the Republic.

I just wish to mention a few of these. In the first place there is the SBDC, as well as ADE and all the problems that that involves. Then, too, there is the Alusaf Foundry, Sapeco’s tea and coffee plantations and the projects surrounding that.

When we have said all these things and analysed the objectives of the IDC to date, three aspects stand out clearly. The first is the savings in foreign exchange. In certain projects the IDC also earns foreign exchange. Last but not least, the IDC also plays an important role in strengthening the manufacture of strategic products. In this regard we have in mind in particular military equipment, as well as other strategic equipment, of course. This includes the financing of Sasol, an undertaking in which the IDC at present has a 30% share.

At this point I also wish to ask the hon the Minister a favour. In 1962 the IDC established the Industrial Selection Group. In 1967 it founded the National Selection Groups. The aim was to afford the general public the opportunity to acquire a share in the activities of the IDC, particularly established industries which were already yielding dividends. For the ordinary man it is becoming increasingly difficult to make investments in this sphere, whether or not he has the capital available. It is evident from news reports that appeared over the weekend that 73% of the Stock Exchange is at present controlled by three companies. That is why I wish to ask the hon the Minister whether he does not want to request the IDC to indicate whether there are new industries that could perhaps be brought together as a group in order to establish an investment portfolio in which shares can be made available for the ordinary investors. This could also afford the IDC the opportunity to obtain external funds once again. It will also enable the public of South Africa to obtain a share in the money voted by this Parliament as capital and later as share capital for the development of decentralized industries in South Africa. The problem in this regard affects large and small industries in South Africa. I do not believe that this is a matter about which we should initiate a debate now. However, I believe that when the Vote of the hon the Minister is discussed in this House we shall again have the opportunity to discuss this matter. It is the issue of the concentration of power in the financial world. I believe that all these aspects have their advantages and disadvantages. Therefore in this case too I want to point out that this is a matter which has two sides, just like a sausage.

What about a tortoise?

No, a tortoise has only one side: its backside.

Earlier the hon the Minister replied to a question asked by the hon member Mr Aronson in regard to the approximately R1,2 billion that will be made available to the IDC over the following three years. I wonder whether the hon the Minister could not give us a fuller exposition of how those funds are to be utilized. I should be obliged if he would do so because I believe that this is an important matter. When we spend R1,2 billion it is important that we should know what proportion of that money is to be spent particularly on the establishment of new industries. We should also like to know what proportion will be spent on decentralized industries.

The share of the IDC appears at its best when we note that South Africa consists of a First and a Third World and that the IDC has had a major share in the bridging of the gap between the First and Third Worlds in this country, particularly by way of the provision of risk capital to promote job opportunities.

Mr Speaker, I take pleasure in supporting the Second Reading of this Bill.

Mr Speaker, the hon member Dr Welgemoed elaborated considerably on the IDC and the importance of the work it is doing. This institution has done a considerable amount over many years to establish, develop, etc, certain industries in South Africa.

We have no problems with clauses 1 and 2 of the Bill we are dicussing now, since they are quite obvious to all of us. However, I want to focus the hon the Minister’s attention on the provisions of clause 3, which sound very vague to me. The proposed new section 5 quin reads as follows, inter alia: Notwithstanding anything to the contrary in this Act contained, the corporation may—

The provisions of this paragraph are not linked to those of paragraph (b); in any case, that is how I read it, since paragraph (b) provides that agreements may be entered into with the governments of the states concerned with the concurrence of the Minister. According to the provisions of paragraph (a) it seems to me as though the IDC can enter into agreements with the states concerned, establish and develop industries there, etc, without the permission of the Minister. It can do so without the Minister having any say. I therefore want to ask the hon the Minister to what extent this Parliament has a say in that regard. To a certain extent the money for this is voted by this Parliament and the annual report of the IDC is laid upon the table here. We could discuss the matter under the hon the Minister’s Vote, but at this stage I just want to ask whether the money for this could possibly be channelled through the Department of Foreign Affairs. I would be very pleased if the hon the Minister could spell out the details for us. It is true that all these matters are not only channelled through the Department of Foreign Affairs when companies conduct business abroad. In this case, however, it is the taxpayers’ money which is being used and I think that it is therefore essential that we should be given more clarity on that score.

In addition it is true that in the past—the hon member Dr Welgemoed also referred to this—the IDC has set development in motion in areas in the Republic such as the Western Province and other areas that were not so developed, and concentrated on spending more money in those areas in the form of decentralization, not only by attracting industries to those areas, but by planning and developing industrial development there. In this way the IDC created employment opportunities for the people in those areas—as the hon member pointed out—and encouraged those people and attracted more money from the private sector in order to proceed with industrial development there.

With regard to regional development I should like to ask the hon the Minister how that development is going to take place in the future. Will it be continued on an equal basis, or does the hon the Minister foresee that since this new development is being envisaged it will be continued on another basis. We have not yet had the opportunity to discuss the whole question of regional development in depth. We really have very little time to debate the important question of regional development during the discussion of the hon the Minister’s Vote, since the portfolio of the hon the Minister covers a very wide field. I think it is very important that in his reply to the Second Reading debate on this Bill the hon the Minister should spell out how we should approach this whole matter. Then we could possibly discuss it further during the Committee Stage, as well as during the Third Reading.