[ad_1]
Small Business Development Minister Khumbudzo Ntshavheni has released the National Small Business Amendment Bill, which aims to further regulate the country’s small, medium and micro-enterprise (SME) sector.
Ntshavheni said the bill further provides for the establishment of a Small Business Ombudsman Service that will act as a support function to the minister.
“Despite the critical role of small businesses in South Africa’s economy and development goals, the SME sector remains vulnerable to exploitation and is unable to use available legal remedies due to prohibitive costs,” Ntshavheni said.
“The Ombud service will become a vital legal instrument for enforcing SME contracts and resolving disputes between companies, as well as for considering and resolving small business complaints regarding the interpretation of the terms of the acquisition agreement. of goods, services or arrears and non-payment of amounts owed and payable to small businesses “.
Ntshavheni said the bill will further help handle complaints in a “ procedurally fair, inexpensive and expeditious manner, ” which will consider what is fair in all circumstances, with due regard to the contractual agreement or other legal relationship between the plaintiff and another party to the complaint.
The bill establishes that this ombudsman can issue rulings in favor of small businesses, including monetary compensation for any financial loss or damage suffered.
Unfair business practices
The bill will also give the minister and ombudsman powers to further regulate small businesses in South Africa on “unfair business practices” issues.
On the recommendation of the Ombudsman, the bill will allow the minister to declare certain practices in relation to small businesses prohibited as unfair business practices.
The minister may also issue regulations that require certain companies to provide in the prescribed manner, information about its hiring and payment practices and small business policies.
Additional rights and responsibilities
The bill also establishes the following rights and responsibilities for small businesses in the country, including:
- The right to a fair and unambiguous commercial contract;
- The right to a reasonable payment date and interest for late payments;
- The right to disclosure of information;
- The right to fair and honest treatment; and
- The right to accountability for large companies and organizations.
However, the bill also states that companies face additional drastic measures on:
- Ambiguous contract terms;
- Lack of written contracts;
- Retrospective changes in arrangements;
- The transfer of commercial risk to the weaker party.
- Using information outside of the purpose for which the other party discloses it;
- Sudden and unjustified termination of a business relationship or termination without reasonable notice;
- Long-term exclusive agreements designed to prevent weaker parties from entering an existing market;
- Unfair practices of exclusion compliance requirements; or
- Abusive contract terms in commercial and retail leases for small businesses.
Read: New bill aims to limit hiring of foreign workers in South Africa
[ad_2]
