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					PRESENTATION OF THE PROPOSED
SECURITY INDUSTRY REGULATION
           BILL, 2001


                        by
                Francois Slabbert
   Manager: Legislation and Policy Development
                  02 May 2001
INTRODUCTORY OBSERVATION


   To our understanding certain operations,
    operational divisions and personnel of Telkom are
    required to comply with specific provisions of the
    Bill, which in terms of its objects is meant to apply
    to the private security, private investigations and
    related industries only.
BUSINESS UNITS POTENTIALLY
   EFFECTED BY THE BILL

 The following in-house operational units, functionaries
  and support personnel of Telkom are potentially
  effected by the Bill:

   its in-house security and investigations section,
   its market research section,
   its market intelligence section,
   its mergers and acquisitions section,
its credit control section,
its collections division,
its personnel division,
its risk management section, and
its information technology (IT) security division.
ADDITIONAL REGULATIONS FOR
  REGULATED INDUSTRIES

  The     aforementioned       functional units,
   functionaries and support personnel will fall
   under the jurisdiction of and be regulated or
   prescribed to by inter alia:
   the Security Industries Regulations Act;
   regulations promulgated pursuant thereto;
   the Minister of Safety and Security;
   the Security Industry Regulatory Authority;
   the Security Officers Board; and
   the code of conduct for security service
    providers.
REGISTRATION AS SECURITY
    SERVICE PROVIDER

  Telkom and other non-security entities might
   arguably be obliged either to:
  register as security service provider with the
   Security Industry Regulatory Authority, or
  if unable to comply with the qualifying
   registration criteria or a failure to obtain
   exemption from the Minister close down its
   business investigations, intelligence and
   associated activities.
    OBJECT OF THE BILL

 The sole stated purpose of the Bill is "To
  provide for the regulation of the security
  industry; for that purpose to establish a
  regulatory authority; and to provide for mattes
  connected therewith".
MOTIVATION FOR THE EXCLUSION
 OF NON-SECURITY INDUSTRIES
FROM THE APPLICATION OF THE
            BILL

  Telkom submits that as a public company -duly
   incorporated in terms of the Companies Act of
   1973 with as its principle object the rendering
   telecommunications services- it should be
   exonerated in all of its capacities from compliance
   with any of the provisions of the Bill.
 It is submitted that only those persons or
  entities that have as their principal business
  objective the rendition of security or associated
  services do in fact belong to the security
  industry or constitutes a security business
  within the meaning of the object of the Bill.
PROVISIONS THAT MAY IMPACT ON
  TELKOM'S OPERATIONAL AND
     BUSINESS INTERESTS
 The definitions and other provisions hereafter listed
  probably has the cumulative effect of making the
  Security Industry Regulation Bill applicable on
  Telkom's management, employees, activities,
  operations, business associations and activities to a
  greater or lesser extent; the relevant provisions
  being:
 the definition of "code of conduct"
 the definition of "private Investigator"
 the definition of "security equipment"
 the definition of "security industry"
 the definition of "security officer"
 the definition of "security service"
 the definition of "security service provider"
   the definition of "the Act"
   section 2 of the Bill
   section 20 of the Bill, and
   section 28 of the Bill


 These provisions, are potentially onerous,
  disruptive, and harmful to Telkom's business
  and operational interests, and will more fully
  be dealt with hereafter.
The Implicit Distinction between
"Security Service Provider" and
      "Security Business"

  Persons "… using …[their] … employees to
   protect or safeguard merely …[their] … own
   property and other interests, or persons or
   property on the premises or under the control
   of such person …" are excluded from the
   definition   of    "security    business"   but
   apparently not from the definition of "security
   service" or of "security service provider".
 Although the insertion of the phrase "for
  remuneration or reward" in relation to
  "security service provider" may have the
  effect of excluding Telkom in certain
  instances, it does not have a similar effect on
  its security investigations and intelligence
  personnel.
 The obligation to register with the Security
  Industries Authority and compliance with the
  industry code, for instance, will apparently
  apply to Telkom equally if is binding on
  members of its staff.
     The Definition of "Private
          Investigator"

 The definition in the Bill of "private
  investigator" includes most of the activities
  normally performed by Telkom's security and
  investigations,     IT    security,   business
  intelligence and many other sections also. This
  definition contained in section 1 of the Bill
  effectively transforms Telkom into a private
  investigator with all the attendant obligations
  of the Bill being imposed and binding on it.
      The Definitions of "Security
    Officer", "Security Service" and
          "Security Industry"
 A "security officer" is defined as someone who is
  employed by another and performs for remuneration one
  or more security services. The definition includes many of
  Telkom's employees who render "security services" aimed
  at protecting company property, particularly in the form of
  incorporeal property such as business interests, but also
  the installation and servicing of "security equipment" and
  the monitoring of signals or transmissions from electronic
  security equipment. We have already noted that in terms of
  the Bill these personnel, as well as their supervisors and
  managers are all regarded as security service providers in
  their own right and therefore subject to all the provisions
  of the Bill relating to security service providers.
          CONCLUSIONS


 Whilst it has undoubtedly become imperative for
  the security and private investigation services
  industries to be regulated, the introduction of
  measures aimed at achieving that end should be
  contained within the confines of its original
  objectives and to the security industry in
  particular.
 Within the modern competitive business
  environment       the    services   of     efficient
  investigations,     security    and    intelligence
  functionaries within commercial companies have
  become more than just a convenience.
  Businesses have come to rely on these functions
  to formulate policies and strategies on which
  continued competitiveness and profitability, and
  even its very existence depends.
 In that sense and in that environment it is
  extremely undesirable for either the operations
  themselves or for the staff performing those
  functions to be subject to undue regulation,
  disruption, scrutiny or interrogation. Because
  market forces and market movements are so
  volatile, timing is often vital to the effect and
  worth of the performance of an act or of the
  conclusion of a transaction or listing so that and
  any untimely interference or stoppage could
  amount to an effective derailment.
       RECOMMENDATIONS

 In view of the aforementioned considerations it is
  submitted that, notwithstanding any contrary
  provision or interpretation of the Bill, all in-house
  security, investigations and intelligence functions
  performed by commercial companies -that do not
  have as their principal business the provision of
  security or private investigation services to third
  parties- be expressly excluded from the
  application of the Bill.
 It is further submitted that the definition of
  "private investigator" in section 1 of the Bill be
  amended by the insertion of the following
  words at the end of the section: "but shall
  exclude any business intelligence
  operations which a company may undertake
  in the course and scope of its normal and
  reasonable endeavours to safeguard its
  security, strategic, operational, and
  business interests and that of its holding
  company or subsidiaries."
Thank you!

				
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posted:12/2/2011
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