Amended National Ports Authority Bill 2003

1. Amended National Ports Authority Bill 2003 Siyabonga Gama Chief Executive Officer National Ports Authority Comments to the Portfolio Committee on Transport 18 June 2003

2. Content • The transitional arrangements • The role of the regulator • Authority’s liability for the acts of a pilot • Other minor issues in the Bill

3. NPA response = Transnet response • The Bill must be: • Aligned with National Commercial Ports Policy • Enacted in totality as soon as possible • NPA to have all the powers and responsibilities of the Authority, during each of the phases • To be deemed to be the Authority -during all three phases • NPA generally satisfied with provisions • Aligned with international best practices

4. Fundamental issues • Ensure that NPA is able effectively to operate as the Authority during the first two phases (i.e. as a division and subsidiary of Transnet) • clauses 3(1) and (4) provide for performance of the Authority's functions • the Initial and Interim Authorities should be deemed to be the Authority • should provide that the Initial and Interim Authorities must perform the functions, and have all the powers, of the Authority

5. Fundamental issues cont... • Should clearly provide for the transfer of staff, assets, liabilities, rights and obligations from the Initial to Interim Authority. • clauses 26 and 27 provide for transfer from Interim to Final Authority • clause 3(4)(a) generally provides for transfer of assets, liabilities, rights and obligations from the Initial to Interim Authority • clause 26 should extend to the initial transfer from Initial to Interim Authority • should include a more detailed provision than clause 3(4)(a), along the lines of clause 27 • in light of clause 3(5)(a), the Bill should provide for possible direct transfer from Initial to Final Authority

6. Fundamental issues cont... • Transfer from the Interim to Final Authority should be structured as a transfer of shares. • clause 27 currently provides for transfer of business as a going concern; • transfer of shares: • removes uncertainty as to what is to be transferred • does not require the formation of a separate legal person and will not require the cession of existing contracts • would be preferable for tax purposes • NPA should be exempt from tax and other duties for both transfers

7. Fundamental issues cont... • The powers of the Regulator should be clarified and limited • clause 30(1) is too wide and uncertain • Chapter 5 relates to appeals and complaints • the Regulator's function should be to hear appeals and complaints against the decisions or actions of the Authority • the subject–matter of the appeals and complaints should be limited to claims that the Authority is abusing its position in: • unfairly preferring Transnet over other port users • unfairly discriminating against port users in relation to the Authority's services • persons whose rights are adversely affected by the actions of the Authority may lodge complaints

8. Fundamental issues cont... • Some specific concerns with clause 30(1) • the Regulator should not determine guidelines for concessions or PPPs • no indication given of the directives that may be issued • the Regulator's jurisdiction over tariffs should be limited to allegations that the Authority is abusing its position in preferring Transnet • the provision relating to hearing appeals and reviews is too wide • Clause 30(1) should be deleted

9. Authority’s liability for acts of a pilot • Exclusion of Authority's liability for acts of a pilot • exclusion of liability should be retained • consistent with international practice • cost of additional insurance will increase port costs • the Authority's liability not otherwise limited, unlike ship owners • exclusions and limitations of liability are common • to provide some remedy to third party vessel, include provision deeming the pilot to be the servant of the owner or master of the vessel under pilotage

10. Authority’s liability cont... • Regulations relating to exclusions and limitations of the Authority's liability • risk of extensive liability • detail should be included in regulations

11. Some other issues in the Bill • The regulation of off-shore cargo handling facilities under (clause 66) should be consistent with the Petroleum Pipelines Bill: • PPRA should license the operation of the facility; • the Authority should license the location of such facility; and • Memorandum of understanding will be signed • Regulator should have discretion not to investigate a particular complaint (clause 48) • The powers of the Regulator to make orders under clause 54 should be limited

12. Some other issues in the Bill cont... • The Authority should be given a reasonable time to adjudicate on license applications (clause 57(6)) • The Authority’s power to inspect under clause 63 should be broadened • Substantial alterations in tariffs should be discussed with the National Port Consultative Committee (clause 73) • The descriptions of cargo and berth dues should be corrected (clause 73) • Training and licensing of pilots should be the Authority's function (clause 78) • The Bill should protect confidential information relating to operations of the Regulator (clause 86)

13. Thank You