Export Credit and Foreign Investments Re-Insurance Amendment Act

Link to law: http://www.gov.za/documents/export-credit-and-foreign-investments-re-insurance-amendment-act
Published: 2001-06-29

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Export Credit and Foreign Investments Re-Insurance Amendment Act [No. 9 of 2001]
Government Gazette
REPUBLIC OF SOUTH AFRICA
Vol. 432 Cape Town 29 June 2001 No. 22436
THE PRESIDENCY
No. 600 29 June 2001
It is hereby notified that the Acting President has assented to the following Act, which is hereby published for general information:–
No. 9 of 2001: Export Credit and Foreign Investments Re-Insurance Amendment Act, 2001

Act No. 9. 2001 EXPORT CREDIT AND FOREIGN INVESTMENTS RE-JNSURANCE AMENDMENT ACT, 2001
GENERAL EXPLASATORY NOTE:
] Words in bold type in square brackets indicate omissions from existing enactments. Words underlined with a solid line indicate insertions in existing enactments.
(English text signed bl, the Acting President.) (Assented to 27 Jurw 2001.)
ACT To amend the Export Credit and Foreign Investments Re-insurance Act, 1957, so as to define an expression and to amend or delete certain definitions; to empower the Minister to enter into an agreement with a registered insurer, to be known as the Export Credit Agency, with the object of insuring certain contracts on behalf of Government; to empower the Agency to establish a Reserve Fund; to enable the Agency to make investments; to repeal certain obsolete provisions; and to make provision for transitional arrangements; and to provide for matters connected therewith.
B E IT ENACTED by the Parliament of the Republic of South Africa, as follows:- Amendment of section 1 of Act 78 of 1957, as amended by section 1 of Act 66 of 1961, section 1 of Act 75 of 1971 , section 1 of Act 81 of 1981, section 1 of Act 27 of 1988 and section 1 of Act 49 of 1996 5
1. Section 1 of the Export Credit and Foreign Investments Re-insurance Act, 1957 (hereinafter referred to as the principal Act ), is hereby amended-
(a) by the deletion of the definition of “contract of insurance”; ( 0 ) by the substitution for the definition of “contract of re-insurance” of the
“ ‘contract of [re-insurance] insurance’ means a contract of [re- insurance] insurance entered into in terms of an agreement referred to i n section [two] 2 . and includes any amendment thereof if such amendment has, at any time before or after it was made. been approved by the Minister in consultation with the Export Credit Agency:“;
“ ‘Export Credit AFency’ means the person contracted in terms of section 2:”:
following definition:
( c ) by the insertion before the definition of “Fund” of the following definition:
(dj bv the substitution for the definition of “Fund” of the following definition:
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, , , ‘. ‘Fund‘ means the [Re-insurance] Reserve Fund [for EGport Credit 20 and Foreign Investments] established under section 5;”; and
( e ) by the substitution for the definition of “Minister” of the following definition: “ ‘Minister’ means the Minister of [Economic Affairs and Technology] Trade and Industry;’..
4 Yo 224% GO\'ERNLIENT GAZETTE. 1 4 JUNE 2001
Act \ ( I . Y. zoo1 EXPORT CREDIT A S D FOREIGK IN\'ESTMEYTS RE-INSURANCE AMENDXIENT ACT. 2001
Amendment of section 1 of Act 78 of 1957, as substituted by section 2 of Act 81 of 1981 and amended by section 2 of Act 27 of 1988
2. Section 2 of the principal Act is hereby amended- [ a ) by the substitution for the words preceding paragraph Irr) of the following
"The Minister [may] $aJ enter into an agreement with [any person who is a registered insurer as defined in section 1 of the Insurance Act, 1943 (Act No. 27 of 1943),] the Export Credit Agency with the object of [re-insuring, against the payment of a premium and] insuriny on behalf of the Government on such [other] terms and conditions as may. in consultation with the Minister of Finance, be prescribed in such agreement. any contracts [of insurance] entered into by [such person with, or for the benefit of,] persons carrying on business in the Republic, being contracts [of insurance against] subject
stances beyond the control of the person suffering the loss or detriment and arising out of or in connection with-";
"(ii) nationalization. expropriation or confiscation;";
"(v) such other causes as the [Minister may in consultation with the Minister of Finance deem] Export Credit Agency deems to arise from risks not normally insurable."; and
(dj by the addition of the following subsections. the existing section becoming
words:
- to risk of monetary loss or monetary detriment attributable to circum-
(h ) by the substitution for paragraph (ii) of the following paragraph:
(c) by the substitution for paragraph (v) of the following paragraph:
subsection (1): "(2) The Export Credit Agency shall be registered as an insurer as
conterndated in section 7(l)(a) of the Short-tenn Insurance Act, 1998 (Act No. 53 of 1998), and shallin its capacity as a registered insurer and juristic person be subject to the relevant insurance and company laws.
(3) Without detracting in any way from the Minister's power to determine through the agreement contemplated in section 2 the terms and conditions in terms of which the Export Credit Agency shall conduct its business. the Minister may appoint members of the Board and the Chief Executive Officer of the Export Credit Agency.
(4) The members and Chief Executive Officer contemplated in subsection (3) shall be suitably qualified to perform the functions of the Export Credit Agency.".
Substitution of section 3 of Act 78 of 1957, as amended by section 2 of Act 88 of 1962
3. The following section is hereby substituted for section 3 of the principal Act:
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"Percentage cover 40
3. A contract of [re-insurance] insurance shall specify the maximum percentage of the loss, as defined in such contract, which is covered by the indemnity under such contract, and such percentage shall not exceed ninety [per centunz] per cent of the loss as so defined [: Provided that the hlinister in consultation with the Minister of Finance may in any 45 particular case approve of a higher percentage].".
Substitution of section 4 of Act 78 of 1957
4. The following section is hereby substituted for section 4 of the principal Act:
"Premiums
4. The rate of premium for any contract of [re-insurance] insurance shall 50 be fixed by the [Minister in consultation with the Minister of Finance] Export Credit Agency. having regard to the various factors which have a bearing on the risks cojzered by the contract and to the cost of administering this Act.".
A c t h’o. 9. 2001 EXPORT CREDIT .AND FOREIGN li\‘\’ESTMENTS RE-INSURAVCE AhlENDMENT ACT. 2001
Amendment of section 5 of Act 78 of 1957. as amended by section 3 of Act 88 of 1962. section 3 of Act 81 of 1981 and section 3 of Act 27 of 1988
5 . Section 5 of the principal Act is hereby amended- ( 0 ) by the substitution for subsection ( I ) of the following subsection:
“( 1) The [Minister] Export Credit Azency shall establish a Reserve 5 Fund [, to be known as the Re-insurance Fund for Export Credit and Foreign Investments, under the control of the Director General: Trade and Industry,] into which shall be paid moneys appropriated by Parliament for the purpose of this Act and premiums and other moneys accruing to the [Minister] Export Credit Agency under contracts of 10 [re-insurance] ~ insurance.”:
(b) by the substitution in subsection (2) for paragraphs (b) and (c) of the following
“(b) [any fees referred to in section six and] any remuneration and allowances referred to in sections [seven] 1 and [eight] 3: 1.5
(c) such other costs of administering this Act as may be determined by the Minister in consultation with the [Minister of Finance] Export Credit Agency.”:
paragraphs, respectively:
(c) by the substitution for subsection (3) of the following subsection: “(3) The [Minister in consultation with the Minister of Finance] 20
Export Credit Agency shall from time to time determine the amount in the Fund which shall be kept available for the payment of any claims, liabilities, fees and costs rekrred to in subsectioi (2), and the balance of the moneys in the Fund over and above the amount so determined shall be [deemed to be deposits for the purposes of the Public Investment 2.5 Commissioners Act, 1984 (Act No. 45 of 1984). and shall be dealt with accordingly] suitably invested by the Export Credit Agency in accordance with the requirements of the Short-term Insurance Act: 1998 (Act No. 53 of 1998).”;
(d j by the substitution in subsection (4) for paragraphs (a) and (b) of the following 30 paragraphs, respectively:
‘‘@ The Export Credit Agency may from time to time obtain advances from the Minister in order to meet temporary deficits in the Fund.
(bJ Any loss incurred by the Minister as a result of such advances shall be met out of moneys appropriated by Parliament for this 35 purpose.”; and
( e ) by the deletion of paragraphs ( c ) and (dj of subsection (4).
Repeal of section 6 of Act 78 of 1957
6. Section 6 of the principal Act is hereby repealed.
.4mendment of section 7 of Act 78 of 1957 40
7. Section 7 of the principal Act is hereby amended by the substitution for subsection
“( 1 ) The Export Credit Agency shall establish, in consultation with the Minister. (1 ) of the following subsection:
a committee which shall evaluate applications for contracts of insurance.”.
Amendment of section 10 of Act 78 of 1957 4s
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8. Section 10 of the principal Act is hereby amended by the substitution for subsection
“ ( 1 ) Any person who wilfully makes a false or misleading statement in or i n connection with a contract of insurance [which forms the subject of a contract of re-insurance,] shall be guilty of an offence and liable on conviction to a fine [not 50 exceeding two hundred pounds] or to imprisonment for a period not exceeding one year. or to both such fine and such imprisonment.”.
( 1 ) of the following subsection:
h s o . 22336 GO\’ERNMENT GAZETTE. 29 J U N E 2001
A c t No. 9. 2001 EXPORT CREDIT A N D FOREIGN INVESTh5ENTS KE-INSLXANCE AMENDMEXT ACT. ’2001
Amendment of section 13 of Act 78 of 1957, as substituted by section 5 of Act 81 of 1981
9. The following section is hereby substituted for section 13 of the principal Act:
“Short title
13. This Act shall be called the Export Credit and Foreign Investments 5 [Re-insurance] Insurance Act, 1957.”.
Substitution of word in Act 78 of 1957
10. The principal Act is hereby amended by the substitution for the word “re-insurance”. wherever it occurs, of the word “insurance”.
Transitional arrangements 10
11. (1) The balance of the Re-insurance Fund for Export Credit and Foreign Investments, as it existed immediately before the commencement of this Act, shall on commencement of this Act be transferred to the Reserve Fund established under section 5 of the principal Act.
in terms of section 2, assume all rights and liabilities of Government that may exist in terms of contracts of re-insurance entered into before the commencement of this Act.
(2) The Export Credit Agency shall as from the date of its agreement with the Minister 15
Amendment of long title of Act 78 of 1957
12. The following long title is hereby substituted for the long title of the principal Act: “To promote trade with countries outside the Republic by providing for the 20 [re-insurance with] insurance on behalf of the Government of the Republic of [insurance] contracts in connection with export transactions, investments and loans or similar facilities connected with such transactions; and to provide for matters connected therewith.”.
Short title and commencement 25
13. This Act shall be called the Export Credit and Foreign Investments Re-insurance Amendment Act, 2001 I and shall come into operation on a date fixed by the President by proclamation in the Gazette.