New liquor bill to be tabled

2003-04-02 15:15

Cape Town - The controversial Liquor Bill, which seeks to give the minister of trade and industry sweeping powers over regulating ownership in the industry, is due to be tabled in parliament next week.

The long-awaited bill, an earlier version of which was rejected by the Constitutional Court five years ago, will regulate the manufacturing, distribution and sales of liquor.

It also aims to set minimum national norms and standards, and attempts to remove racial discrimination in the liquor industry by promoting diversity of ownership.

The draft bill is based on the premise that liquor is a "potentially harmful substance requiring strict regulation".

Members of parliament's trade and industry portfolio committee expressed concern on Wednesday over certain provisions in the draft bill, including the prohibition of "concoctions", and the powers accorded to the minister.

According to the draft bill presented to the committee, a manufacturer will not be permitted to distribute or sell its products, or hold any interests in a distribution or retail company.

Similar provisions apply for both distributors and retailers.

Trade and Industry deputy director-general Astrid Ludin said the intention behind separating the functions was to facilitate other entrants, such as black economic empowerment concerns, into the sector.

"It is about how participants use control across levels to exclude new entrants," she said.

Manufacturers and distributors will be expected to dispose interests in areas that are not included in their licensed business function.

It will be left to the minister's discretion to decide whether any particular ownership structure was "healthy and justified".

Ludin said an exemption to the regulation could apply in certain cases, such as a wine farm selling its own products on its premises.

The application for licences to manufacture liquor would be the subject of extensive consultation and public hearings, she said.

The draft bill prohibits the manufacture, consumption and sale of "concoctions" or alcoholic mixtures, that could harm one's health.

"A concoction is essentially something that is bad for you, bad for your health," Ludin said.

This would not necessarily include all home-made beverages, she said, although MPs were concerned the definition in the draft bill was too broad.

The bill seeks to clarify the jurisdiction of national and provincial governments, following a Constitutional Court ruling on an earlier draft in 1998.

The Liquor Bill of 1998 was sent to the court by the President after being approved by parliament, due to concerns over whether it infringed on provincial powers.

In terms of the draft, national government will regulate the manufacture and distribution of liquor, while provincial government would control the retail sector, and in particular retail licensing.

Provinces can determine certain criteria such as the age limits for sale to minors, provided they were not below national minimum standards.

Ludin said provincial government would, through legislation, determine hours, days and zones for sale, and deal with liquor sales in supermarkets.

- SAPA