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[1999] ZACC 15
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Ex Parte President of the Republic of South Africa: In re Constitutionality of the Liquor Bill (CCT12/99) [1999] ZACC 15; 2000 (1) SA 732 (CC); 2000 (1) BCLR 1 (CC) (11 November 1999)

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CONSTITUTIONAL COURT OF
SOUTH AFRICA
                                                                                                                        Â
Case
CCT 12/99
EX PARTE THE PRESIDENT OF THE REPUBLIC OF SOUTH AFRICA
IN RE: CONSTITUTIONALITY OF THE LIQUOR BILL
Heard on:                   31
August 1999
Decided on:               11
November 1999
                                                            JUDGMENT
CAMERON AJ:
Introduction
[1]
       The
legislation before us is inchoate.  Parliament has passed a Bill, but it has
not received the assent of the President,
who referred it to this Court for a
decision on its constitutionality.  This is the first time that the provisions
of the 1996 Constitution
(“the Constitution”) allowing for such a referral have
been invoked, and our decision requires consideration of what that procedure
entails as well as of the questions raised concerning the Bill’s
constitutionality.
[2]
       The
Liquor Bill was introduced in the National Assembly on 31 August 1998.  It
passed through various legislative stages
in terms of section 76(1) of the
Constitution before Parliament approved it on 2 November 1998.  When the Bill
was sent to the President
for his assent, he declined to grant it.  Instead,
because he had reservations about its constitutionality, he referred it back
to
the National Assembly on 22 January 1999 for reconsideration.  On 3 March 1999,
the National Assembly resolved that “the House,
having reconsidered the Liquor
Bill [B 131B-98], returns it to the President”.  No amendments had been
effected.  On 8 March
1999, the President referred it to this Court for a
decision on its constitutionality.  In doing so, he invoked his power pursuant
to section 84(2)(c) of the Constitution, which provides that the President is
responsible for “referring a Bill to the Constitutional
Court for a decision on
the Bill’s constitutionality”.
1
[3]
       On
19 March 1999 the President of this Court issued directions, attaching the
President’s notice of referral, and inviting
the President himself and the
government of the Republic of South Africa, any political party represented in
the National Assembly,
any provincial delegation represented in the National
Council of Provinces and any provincial government to make representations
to
the Court concerning the constitutionality of the Bill, and requiring any party
wishing to do so to give notice of its intention,
and to indicate whether it
wished to lead evidence and if so the purpose and relevance of that evidence.
[4]
       In
response, the Western Cape government indicated that it wished to be
represented and to place before the Court affidavit
evidence of the regulation
of liquor and liquor licensing in the Western Cape, in South Africa and in
comparable jurisdictions, “showing
that it is not necessary to have national
legislation on liquor licences for any of the purposes set out in section
44(2)”.
2
  The Minister of Trade
and Industry wished to supply evidence of the background to and history of the
legislation and “why it
was necessary for Parliament to legislate on these
matters in the light of the requirements of section 44(2)”.
[5]
       Under
further directions issued by the President of this Court, the Western Cape
government lodged an affidavit dealing
with its objection to the Bill.Â
Thereafter, the Minister of Trade and Industry, as representative of the
government of the Republic
of South Africa (“the Minister”), submitted an
affidavit, in response to which the government of the Western Cape submitted a
replying affidavit.  Both the Western Cape government and the Minister were
represented at the hearing.
Presidential Referral
Under Section 79
[6]
       Our
decision requires us to consider first what the referral to this Court by the President
for a decision on a Bill’s
constitutionality entails.  The Constitution, which
subjects all legislation to review for its constitutionality, and makes any
law
inconsistent with it invalid,
3
embodies three routes to judicial consideration of the
constitutionality of legislation passed by Parliament.  One is a challenge
by
an interested party in a competent Court under one or more provisions of the
Constitution.
4
  Another is an application by at least one third of the
members of the National Assembly to the Constitutional Court for an order
declaring all or part of an Act of Parliament unconstitutional.
5
  The third is that
invoked in the present case, namely referral by the President before a Bill
becomes a statute.
6
Â
[7]
       The procedure the President invoked is not without
parallel in comparable systems, though in the United States,
7
the United Kingdom,
8
Australia
9
, New Zealand
1
0
and Germany,
1
1
no pre-enactment judicial
procedure for testing statutory or constitutional validity exists.  Comparable
procedures do exist in
other constitutions, though none is quite like our own.Â
In Ireland, the Constitution
1
2
provides a procedure for a pre-enactment reference of
certain bills to the Supreme Court by the President “for a decision” whether
the Bill or any specified provision is “repugnant” to the Constitution.
1
3
  The French Constitution
of 1958 provides for the compulsory referral of “organic laws” (that is, laws
on the judiciary, the
composition of parliament, finance and the procedure of
the Conseil Constitutionnel), before they are promulgated, to the Conseil
Constitutionnel
1
4
“which shall decide on their compatibility with the Constitution”.  In
addition, other laws may be submitted before promulgation
to the Conseil
Constitutionnel by the President of the Republic, the Prime Minister, the
President of the National Assembly, the
President of the Senate, or sixty
deputies or senators.  A provision that the Conseil Constitutionnel declares
unconstitutional
“may neither be promulgated nor applied”.  The French
pre-promulgation procedure has a different  focus and effect to that
of South
Africa, since no French law may after promulgation be challenged before the
Conseil Constitutionnel for its constitutionality,
although certain challenges
may be brought before the Conseil d’Etat.
1
5
      In Canada, the Supreme Court
Act imposes an obligation on the Supreme Court to give advisory opinions on the
constitutionality
of a federal law or proposed federal law.
1
6
  According to Hogg —   Â
“Sometimes
questions of law are referred in advance of the drafting of the legislation;
sometimes draft legislation is referred
before it is enacted; sometimes a
statute is referred shortly after its enactment; often a statute is referred
after several private
proceedings challenging its constitutionality promise a
prolonged period of uncertainty as the litigation slowly works its way up
the
provincial or federal court system.  The reference procedure enables an early
resolution of the constitutional doubt.”
1
7
[8]
In India, similarly to South Africa, the President may in
respect of Bills withhold assent, and return them to Parliament for
reconsideration
in whole or part, together with recommendations.  If the Bill
is passed again with or without amendments, and presented to the President,
the
President must assent to it.  However, the Indian Constitution empowers the
President to consult the Supreme Court for its “opinion”
about a question of
law or fact “of such a nature and of such public importance that it is
expedient to obtain the opinion of the
Supreme Court upon it”.
1
8
  In
In Re The Kerala
Education Bill
,
1957,
1
9
Das CJ stated that:
Â
“It is for the President
to determine what questions should be referred and if he does not entertain any
serious doubt on the other
provisions it is not for any party to say that
doubts arise also out of them and we cannot go beyond the reference and discuss
those
problems.”
[9]
The procedure the President must follow when referring a
Bill to this Court is set out in section 79.
2
0
  In terms of section 79(1) the
President must either assent to and sign a Bill passed by Parliament, or, if he
has reservations
about its constitutionality, refer it back to the National
Assembly for reconsideration.  Section 79(4) then provides:
“If, after
reconsideration, a Bill fully accommodates the President’s reservations, the
President must assent to and sign the
Bill; if not, the President must either —
(a)  assent to and sign the Bill; or
(b)  refer it to the Constitutional Court for a decision on
its constitutionality.”
2
1
[10]
     Three related questions require clarification in the
light of the President’s invocation of this procedure:
(a) Is the Court required
to consider only the reservations the President has expressed, or can and
should it direct its attention
more widely?
(b) Should the Court in
determining the Bill’s “constitutionality” examine its every provision so as to
certify conclusively
that in every part it accords with the Constitution?
(c) Does the Court’s
finding regarding the Bill’s constitutionality or otherwise preclude or
restrict later constitutional adjudication
regarding its provisions once
enacted?
[11]
     Section 79(5) requires a decision from this Court as to
whether “the Bill is constitutional”.  In terms of section 167(4)(b),
only the
Constitutional Court may decide on the constitutionality of any parliamentary
Bill, but may do so only in the circumstances
anticipated in section 79.
2
2
  The general powers of
the courts in dealing with constitutional matters are set out in section 172.
2
3
  That section requires
that a Court when deciding a constitutional matter within its power “must
declare that any law or conduct
that is inconsistent with the Constitution is
invalid to the extent of its inconsistency”.  Since the Bill has not yet been
enacted,
it is clearly not a “law” as envisaged by section 172(1).  Moreover,
since the Bill as yet lacks legal force, the remedy section
172 envisages — a
declaration of invalidity — is plainly inappropriate.  It follows that the
provisions of section 172 are not
directly helpful in guiding the Court as to
its role in the section 79 referral procedure.
[12]
     The terms of section 79 contrast with those of section
80, which empowers members of the National Assembly to seek an order
that “all
or part” of an Act of Parliament is unconstitutional.  The contrasting wording
of section 79 may seem to suggest that
this Court is obliged to audit the whole
of a Bill so as to determine its constitutionality comprehensively and
conclusively.  But
this impression is countered by the fact that section 79
clearly envisages that the President’s “reservations” must be specified
when he
refers a Bill back to Parliament.  Section 79(3)(a) requires that the National
Council of Provinces participate in the reconsideration
of the Bill if the
President’s reservations are of a specific kind — namely if they relate to “a
procedural matter that involves
the Council”; while section 79(4) requires the
President to assent to and sign the Bill if after reconsideration it “fully
accommodates”
his reservations.  Both provisions entail that the President must
itemise his reservations in relation to a Bill.
[13]
     It is moreover clear that the President is empowered to
refer a matter to this Court in terms of section 79 only if his reservations
concerning the constitutionality of the Bill are not fully accommodated by
Parliament.  If the President has no reservations concerning
the
constitutionality of the Bill, or if his reservations have been fully
accommodated by Parliament, the referral would be incompetent.Â
In the
circumstances, the presidential power is limited under section 79(4)(b) to the
power to refer a Bill to the Constitutional
Court “for a decision on its
constitutionality” with respect to his reservations.  Section 79(5) must thus
be read as subject
to a comparable limitation, empowering the Court to make a decision
regarding the Bill’s constitutionality only in relation to
the President’s
reservations.Â
[14]
     This makes it clear, in answer to the first question
posed in para 11 above, that the Court considers only the President’s
reservations.
2
4
  Whether it may ever be appropriate for the Court upon a presidential
referral to consider other provisions which are manifestly
unconstitutional,
but which are not included in the President’s reservations, need not be decided
now.
[15]
     By corollary (as Mr Wallis, who appeared with Mr
Govindsamy for the Minister, submitted) section 79 does not entail a
“mini-certification”
process.  The specificity required of the President in
spelling out his reservations plainly negatives the notion that this Court’s
function is to determine, once and for all, whether a Bill accords in its
entirety with the Constitution.  What section 79 entails
is that in deciding on
the constitutionality of the Bill this Court must in the first instance
consider the reservations the President
specified when he invoked the section
79 procedure.  This contrasts with the function the interim Constitution
2
5
required this Court to
fulfil at the time of the adoption of the 1996 Constitution.  There its task
was to render a “final and
binding” decision on whether “all” the provisions of
the 1996 Constitution conformed with the Constitutional Principles enumerated
in the interim Constitution.
2
6
  The answer to the second question posed in para 11
above is therefore No.
[16]
     However, Mr Wallis also submitted that the President
could invoke section 79 only where his reservations about a Bill went
to its
constitutionality “as a whole”.  Mr Wallis accordingly contended that this
Court, in deciding on a Bill’s constitutionality,
should confine itself to
questions which would result, were the Bill to be enacted, in the whole of the
legislation being struck
down as unconstitutional.  This seems to me for two
reasons to be mistaken.  First, if correct, it places a fetter on the
President’s
powers of referral under section 79 which the provision in my view
does not entail.  The condition for the invocation of section
79 is that the
President must have “reservations about the constitutionality” of a Bill.  The
provision does not state that
the reservations must relate to the Bill’s
constitutionality “as a whole”, and to read it as if it did would in my view
unduly
attenuate the duty resting upon the President in exercising power under
the Constitution to scrutinise the constitutionality of legislation
placed
before him for assent and signature.  Section 79 seems to me clearly to empower
the President to refer a Bill even if his
reservations relate to only a single
provision in it.  If this Court were to hold that any portion of the Bill
relating to the President’s
reservations is unconstitutional, it must follow
that the whole Bill cannot be said to be “constitutional” under section 79(5).
[17]
     Second and equally important, the argument entails that
this Court would be obliged to declare a Bill “constitutional”
in terms of
section 79(5) even if it concluded that material provisions in it were
unconstitutional, provided only that these did
not vitiate the Bill as a
whole.  That cannot be correct.  What the President refers to this Court under
section 79 is legislation
in nascent form.  Given that the powers accorded by
section 172(1) are inapplicable, in effect this Court’s decision on the Bill’s
constitutionality constitutes a finding on the President’s reservations.  That
decision, without being able to be or purporting
to be comprehensive, must
clearly encompass any provisions the Court scrutinises in fulfilment of its
remit and finds unconstitutional.Â
Section 79(5) obliges the President to sign
the Bill only if this Court decides that the Bill “is constitutional”.  If it
withholds
such a finding — whether because the legislation is unconstitutional
as whole, or only in part — the President may not sign the
Bill.
[18]
     There is however more to section 79 than only the
President’s reservations.  The provision envisages a series of steps,
initiated
by the President, in which Parliament is itself an active participant.  The
President can refer a Bill to this Court only
after Parliament has unavailingly
reconsidered it in the light of his reservations.  The attitude of the National
Assembly (or,
where appropriate, Parliament) to the Bill’s constitutionality is
therefore also a material factor in this Court’s determination,
and it is for
this reason that this Court’s rules permit all political parties represented in
Parliament as of right to make written
submissions relevant to the
determination of the Bill’s constitutionality.  It follows that in deciding on
the Bill’s constitutionality
the Court must consider the reservations of the
President as well as any submissions relevant to them by any party represented
in
Parliament.
[19]
     The referral procedure in my view requires this Court to
give a decision in terms of section 79(5) relating to the President’s
reservations, and the submissions regarding those reservations made by parties
represented in the National Assembly, and thereby
to decide on a Bill’s
constitutionality.  However, regarding the third question posed in paragraph 11
above, even if this Court
does decide that the Bill is constitutional,
supervening constitutional challenges after it has been enacted are not
excluded, save
to the extent that this Court has in deciding the questions the
President placed before it in the section 79 proceedings already
determined
them.  In this regard, the well-established principle that a Court of final
appeal will not depart from its previous
decisions unless they are shown to
have been clearly wrong has obvious relevance.
2
7
The
President’s Referral
[20]
     The
President stated the basis of his referral thus:
“The long title of the
Bill summarises the objectives of the Bill as follows:
‘To maintain economic
unity and essential national standards in the liquor trade and industry;  to
regulate the manufacture, distribution
and sale of liquor on a uniform basis;
to facilitate the entry and empowerment of new entrants into the liquor trade;
and to address
and reduce the economic and social costs of excessive alcohol
consumption; and to provide for matters connected therewith.’
I have reservations about
the Constitutionality of the Bill to the extent that the Bill deals with the
registration for the manufacture,
wholesale distribution and retail sale of
liquor.  The relevant provisions which make it clear that the Bill intends to
establish
a framework for the registration of the manufacture, wholesale
distribution and retail sale of liquor are
inter alia
clauses 26; 27(a),
(b), (c) and (d); 29; 30; 32; 33; 34 and 35.  There are other provisions which
relate generally to the process
of registration or to the sale of liquor.  To
the extent that they apply to the registration for the manufacture, wholesale
distribution
and retail sale of liquor they are similarly subject to my reservation
as set out below.
5
Part A of Schedule 5 of
the Constitution, 1996 lists the functional areas of exclusive provincial
legislative competence.  The fifth
item thereof is ‘liquor licences’.  The
implication of the inclusion of an item, or more properly, a functional area in
Schedule
5 is that Parliament may, in terms of section 44(2) of the
Constitution, 1996 only ‘intervene by passing legislation in accordance
with
section 76(1), with regard to a matter falling within a functional area listed
in Schedule 5, when it is necessary -
(a) ...
(b) to maintain economic
unity;
(c) to maintain essential
national standards;
(d) to establish minimum
standards required for the rendering of services; or
(e) to prevent
unreasonable action taken by a province which is prejudicial to the interest of
another province or to the country
as a whole.’
6
If the legislation is not
so necessary then Parliament may not enact legislation dealing with matters falling
within a functional
area listed in Schedule 5.  The question as to whether this
legislation is “
necessary
” within the meaning of this section and for
the purpose set out in section 44(2)(b) - (e) is a question I am unable to
answer with
certainty even though I am satisfied that the purposes the
legislation seeks to achieve are commendable.  Whether the particular
requirements set out in section 44(2) have been met has proved difficult to
determine relying as they do on an assessment of legal,
factual and policy
considerations and in respect of which there are no constitutional or
jurisprudential guidelines.
7
The implementation of this
legislation without a clear indication of its constitutionality may be chaotic
and could lead, not only
to a legislative vacuum if the framework should be set
aside, but also to uncertainty in respect of any actions already taken
thereunder
including any registrations duly granted.  I am accordingly
referring this matter to the Constitutional Court for a decision on
its
constitutionality.
8
In referring this matter
to the Constitutional Court I am acting in my capacity as Head of State in
terms of section 84(2)(c).  I
am accordingly taking the liberty of serving
copies of this notice of referral on the Government, who will be represented by
the
Minister of Trade and Industry, on the Speaker of the National Assembly, on
the Chairperson of the National Council of Provinces
and on the Government of
the Province of the Western Cape on account of its intention, duly communicated
to me, to make representations
contesting the constitutionality of the Bill.  I
am however placing the matter before you to consider how these and other
interested
parties may join these proceedings when the court duly considers the
constitutionality of the Bill.”
The Procedural Challenge
[21]
     The
Western Cape government challenges the manner in which Parliament adopted the
Liquor Bill.  As can be seen from the
terms of the President’s referral, the
issue he had in mind was whether the Bill was constitutionally justified under
section 44(2).Â
Questions regarding the Bill’s constitutionality were first
raised, by the Western Cape government, in early 1998.  It is clear
that from
the outset the constitutional issue present in the minds of those dealing with
the Bill was not whether it set up a system
of liquor licences — for they seem
to have accepted that it did — but whether there was justification under the
Constitution’s
“override” provisions for Parliament to intervene in this area
of exclusive provincial competence.  The measure was introduced
into Parliament
and dealt with as a “Bill affecting provinces” in terms of section 76 read with
section 44(1)(b)(ii) and section
44(2) of the Constitution.  Submissions on the
question whether the invocation of the “override” was justified were advanced
on behalf of the Western Cape government during the legislative process.  The
President referred the Bill back to Parliament on
22 January 1999 on the basis
not that there was any specific provision raising constitutional questions, but
that the regulatory
framework the Bill sought to introduce “deals with liquor
licensing in the provinces which the Bill is entitled to do only if it
is
necessary” in terms of section 44(2).  When the National Assembly reconsidered
the Bill, the Minister of Trade and Industry
defended the measure on the basis
of the “national legislature’s legitimate right to intervene in order to
preserve economic
unity and to establish national standards”.  The President
subsequently referred it to this Court on the identical basis.  Indeed,
in his
notice in response to the directions of the President of this Court intimating
that he wished to submit evidence, the Minister
himself alludes only to the
“override” issue.  The founding affidavit of the Western Cape government
accordingly alludes solely
to the competency question.Â
[22]
     Only
in the Minister’s answering affidavit was the contention advanced for the first
time that it was incorrect to characterise
the Liquor Bill as a liquor
licensing measure, that the matters it regulated fell in the first place within
the national legislative
competence, and that to the extent that it dealt with
liquor licences this was incidental to its pursuit of national competencies.Â
It was in response to this new contention that the Western Cape government in
its written argument raised the manner in which the
Bill passed through
Parliament, averring that if the Bill was not legislation with regard to a
functional area listed in Part A of
schedule 5 of the Constitution, it was
invalid since it was enacted in accordance with the procedure prescribed by
section 76(1).Â
Although the procedural issue was not encompassed by the President’s
reservations, we are prepared to assume that the issue is
relevant to those
reservations.
[23]
     Chapter
4 of the Constitution, which establishes and regulates Parliament, specifies
how statutes must be enacted by Parliament.Â
The relevant provisions comprise
the enactment of all Bills,
2
8
Bills amending the Constitution,
2
9
ordinary Bills not
affecting provinces,
3
0
ordinary Bills affecting provinces
3
1
and money Bills.
3
2
  In terms of section
76(4)(a), a Bill must be dealt with in accordance with the procedure in
sub-section (1) amongst others if it
provides for legislation “envisaged in
section 44(2)”.
[24]
     There
are three principal differences between the procedure stipulated in section 75
for ordinary Bills not affecting provinces
and that in section 76.  First, the
latter gives more weight to the position of the National Council of Provinces.Â
This occurs
chiefly through the invocation of the Mediation Committee.
3
3
  If one House rejects a
Bill passed by the other, or if one House refuses to accept a Bill as amended
by the other, the legislation
must be referred to the Mediation Committee,
which consists of nine members of the National Assembly and one delegate from
each provincial
delegation in the NCOP.  Second, if the NCOP raises objections
to a version of the Bill approved by the Mediation Committee in circumstances
where the Bill was introduced in the National Assembly, the Bill lapses unless
the National Assembly passes it again with a two-thirds
majority.  Third, when
the NCOP votes on a question under section 75, the provisions of section 65 —
in terms of which each province
has a single vote in the NCOP “cast on behalf
of the province by the head of its delegation”,
3
4
and in terms of which questions
before the NCOP are “agreed when at least five provinces vote in favour of the
question”
3
5
— do not apply.  Instead, in terms of section 75(2), each delegate in a
provincial delegation has one vote and the question is
decided by a majority of
the votes cast (the presiding delegate having a casting vote), subject to a
quorum of one third of the delegates.
[25]
     It
would be formalistic in the extreme to hold a Bill invalid on the ground that
those steering it through Parliament erred
in good faith in assuming that it
was required to be dealt with under the section 76 procedure, when the only consequence
of their
error was to give the NCOP more weight, and to make passage of the
Bill by the National Assembly in the event of inter-cameral disputes
more
difficult.  It is hard to see how a challenge based on the first two
differences between the relevant parliamentary procedures
can invalidate the
enactment of a statute.  The third is however of import, since whether a
provincial delegation votes corporately
through its head of delegation, as
prescribed by section 65, or individually by each member casting a vote, as
prescribed by section
75(2), may in defined circumstances be determinative as
to whether the NCOP passes a Bill.
[26]
     However,
it is in my view unnecessary to decide this question, since the contention of
Mr Trengove (who appeared with Mr
Breitenbach on behalf of the Western Cape
government) that if the Bill was not legislation of the kind envisaged in
section 44(2)
then it was invalid since it should have been enacted by the
section 75(1) procedure, seems to me to leave out of account the provisions
of
section 76(3).  This sub-section requires that a Bill must be dealt with under
the procedure established by either section 76(1)
or section 76(2) amongst
others, “if it falls within a functional area listed in Schedule 4”.  It must
be borne in mind, moreover,
that section 76 is headed “Ordinary Bills affecting
provinces”.  This is in my view a strong textual indication that section
76(3)
must be understood as requiring that any Bill whose provisions in substantial
measure fall within a functional area listed
in Schedule 4 be dealt with under
section 76.
[27]
     Whatever
the proper characterisation of the Bill — a question to which I return below
3
6
— it can hardly be
doubted that if it does not seek to trench on the provinces’ exclusive
legislative competence in respect of
“liquor licences”, thereby requiring
justification under section 44(2), a large number of its provisions must be
characterised
as falling “within a functional area listed in Schedule 4”, more
particularly the concurrent national and provincial legislative
competences in
regard to “trade” and “industrial promotion”.
[28]
     Once
a Bill “falls within a functional area listed in Schedule 4”, it must be dealt with
not in terms of section 75,
but by either the section 76(1) or the section
76(2) procedure (the differences between the latter two relate only to where
the Bill
is introduced).  The procedural point argued on behalf of the Western
Cape government therefore has no merit.
The Challenge to the
Constitutionality of the Liquor Bill
[29]
     The
Bill before us is the product of a process stretching back to 1994, when the
development of policy in respect of the
liquor industry became a subject of the
regular meetings between the national Minister of Trade and Industry and the
Members of the
Executive Committees responsible for economic affairs, trade and
industry in each of the provinces (known as “Min-MEC” meetings).Â
In 1996, the
Department of Trade and Industry, in collaboration with provincial departments
charged with economic affairs, carried
out an analysis of existing liquor
legislation
3
7
and researched the state of the liquor industry.  In July 1997, the
national government published a Liquor Policy Document and a
draft Bill.
3
8
  The stated objects of
the draft Bill’s provisions were to address the regulation of the production,
distribution and sale of
liquor through restructuring the liquor industry and
to control the economic and social costs of excessive alcohol consumption.Â
Submissions were called for, and over the next year more than 350 were received.Â
Public hearings and workshops on the policy and
the draft Bill were held both
nationally and provincially.  The Bill was introduced into Parliament on 31
August 1998 and, as set
out earlier, submitted to the President for his assent
and signature which resulted in the present adjudication.
[30]
     In
his affidavit the Minister of Trade and Industry asserts that the objectives
the Bill seeks to attain include —
(a) erasing the history of the use of liquor as an
instrument of control over most of the population as part of the policy of
apartheid;
(b) making the liquor industry more accessible to
historically disadvantaged groups.
It is evident, and relevant to a proper understanding
of these proceedings, that liquor licensing has a shameful history in this
country’s
racial past.  The manufacture, distribution, sale and use of liquor
after the Union of South Africa came into being in 1910 was
regulated through
the Liquor Act, 30 of 1928 and Native (Urban Areas) Act, 21 of 1923 (for
Africans).  These statutes together prohibited
the supply and delivery to or
the possession of liquor by blacks (Africans, coloureds and Indians).
3
9
  Blacks were allowed to be supplied or to be in
possession of liquor only for “medical purposes”;
4
0
for “sacramental purposes”;
4
1
or if an exemption was granted.
4
2
Umqombothi or “homebrew”,
4
3
derived from sorghum, was
alone treated differently.
4
4
  Under the authorisation
of a magistrate, and in an area declared as lawful for the production, brewing,
sale and consumption of
umqombothi, the statute did not apply.
4
5
  The availability of liquor, especially umqombothi
for Africans, was largely determined by area of residence.
4
6
  Thus liquor acted as a means of social control since
it was an offence for a black person to be in possession of liquor outside
the
designated areas.  What is more, it is evident from the scheme of the
legislation that blacks were precluded from manufacturing
liquor apart from
umqombothi.  The latter was to be produced in stated quantities, in certain
instances only, and solely for household
use.  The possession of liquor by
blacks contrary to these provisions was an offence.
4
7
  The period between the early 1930s and late 1950s
was characterized by harassment and invasion of privacy by police enforcing
these
provisions.  It has been recorded that in 1957, no fewer than 16,8 per
cent of convictions of Africans for all offences were for
statutory liquor
offences such as the illegal possession of liquor and unauthorised beer
gatherings.
4
8
  In 1960 the Malan
Commission of Inquiry (into the General Distribution and Selling Prices of
Alcoholic Liquor) stated in its report
that, although they ran the risk of
being arrested, Black people could obtain liquor as they wanted through illicit
channels.  But
because the trade was illegal, they had to pay high prices, and
the liquor often reached them in adulterated form.  The commission
concluded
that “the application of the Liquor Act is a question of impossibility in our
present era.”
4
9
  The commission also made
recommendations for changes in the law.  Various amendments were consequently
passed, easing some of
the restrictions.
5
0
[31]
     It
is against the background of this history of overt racism in the control of the
manufacturing, distribution and sale of
liquor that the Minister contends that
the provisions of the Bill constitute a permissible exercise by Parliament of
its legislative
powers.
[32]
     The
Bill is divided into seven chapters: Objects and Application; National and
Provincial Structures and Functions; Registration;
Terms and Conditions
Applicable to Sale of Liquor; Law Enforcement and Judicial Proceedings;
Regulations; and General Provisions.Â
It creates a “national and uniform
administrative and regulatory framework” for the liquor industry
5
1
through the
establishment, on the one hand, of a National Liquor Authority
5
2
, whose task is to approve
“registration” for the manufacture and wholesale distribution of liquor
5
3
, and whose decisions are
subject to the National Liquor Appeal Tribunal,
5
4
and, on the other, of provincial
liquor authorities,
5
5
which consider “registration” for retail liquor sale
and liquor sales at special events,
5
6
and against whose decisions appeal
lies to provincial panels of appeal.
5
7
  Within its sphere of application,
5
8
the Bill prohibits on
pain of criminal penalty
5
9
the manufacture, distribution or sale of liquor
unless the manufacturer, distributor or seller is registered.
6
0
  The Bill creates a
panoply of inspection, entry and enforcement powers together with attendant
offences and criminal penalties.
6
1
[33]
     First,
the Bill divides economic activity within the liquor industry into three
categories:  production (which it terms
“manufacturing”), distribution, and
retail sales.  This division, referred to in the evidence before us as the
“three-tier
registration system”, entails two consequences foundational to the
structures the Bill seeks to erect.  First, an application
for registration may
be made in respect of only one of the three categories.  Multiple registration
is explicitly excluded,
6
2
and, subject to transitional arrangements,
6
3
no person registered in
one category may, except for liquor sales at special events, hold a controlling
interest
6
4
in another person registered in a different category.
6
5
  The Minister indicates
in his affidavit that these provisions are directed at addressing the
concentration of economic power in
the manufacturing sector in the hands of a
limited number of participants, and the inter-relationships between
manufacturers (including
distribution depots), wholesalers, hauliers and
retailers, by limiting “the excessive vertical integration” in the industry and
thus at opening opportunities for new entrants to the industry, particularly
“those drawn from historically disadvantaged groups”.
[34]
     Second,
the Bill divides responsibility for these tiers between national and provincial
government by effecting a division
between manufacture and distribution of liquor
on the one hand and retail sale, on the other.  The Bill treats manufacture and
distribution
of liquor as national issues, to be dealt with by the national
liquor authority and appeal tribunal, whose members are appointed
by the
Minister.  Retail sales (including sales of liquor at special events) are
treated as provincial issues, and are to be dealt
with by provincial liquor
authorities and provincial panels of appeal.  For the establishment of the
latter, the Bill imposes an
obligation upon the provincial legislature of each
province to pass legislation.
6
6
  The national liquor authority is charged with
considering whether the statutorily prescribed requirements for registration as
a
wholesaler or distributor have been met, and with considering the “merits” of
an application, and determining the terms and conditions
applicable to the
registration that conform with prescribed criteria, norms and standards
pertaining, inter alia, to limiting vertical
integration, encouraging diversity
of ownership and facilitating the entry of new participants into the industry.
6
7
  Provision is made for
objections to applications for registration.
6
8
  The provincial liquor authorities
are obliged to consider applications for retail and special event
registrations.
6
9
  The public must be enabled to lodge objections.
7
0
[35]
     The
Western Cape government launches two main attacks on the constitutionality of
the Bill.  These are directed on the one
hand against the exclusion of
provincial governments from any role in the licensing of liquor manufacturers
and distributors; and,
on the other, against the extent of national
intervention the Bill permits in the provinces’ powers to regulate retail
licensing.Â
The Province contends that it is evident from the detail and sweep
of the Bill that its main aim is comprehensively to regulate the
activities of
persons involved in the manufacture, wholesale distribution and retail sale of
liquor, and consequently that the Bill’s
system of “registration” regarding all
three tiers of the industry falls squarely within the exclusive functional area
of “liquor
licences” in Schedule 5A.  The limited and strictly enumerated powers
the Bill confers on provincial organs of state, which the
Bill obliges the
provinces to establish, do not detract from this.Â
[36]
     The
province’s complaint is in essence that the Bill exhaustively regulates the
activities of persons involved in the manufacture,
wholesale distribution and
retail sale of liquor;  and that even in the retail sphere the structures the
Bill seeks to create reduce
the provinces, in an area in which they would
(subject to section 44(2)) have exclusive legislative and executive competence,
to
the role of funders and administrators.  The province asserts that the Bill
thereby intrudes into its area of exclusive legislative
competence.
[37]
     The
Minister for the first time in his affidavit disputes the province’s characterisation
of the Bill as a liquor licensing
measure.  Instead, he asserts, the Bill is
directed at trade, economic and competition issues on the one hand and health
and social
welfare issues on the other.  He emphasises the national importance
of having a properly structured and regulated liquor industry:Â
“The fact that
one aspect of the mechanism for implementing the Government’s national policies
in this regard is a system of
registration of participants in the liquor
industry does not”, he contends, “mean that it constitutes an impermissible
trespass
upon the legislative powers of provincial legislatures.”
[38]
     The
terms of the President’s referral, and the conflicting contentions of the
Province and of the Minister, require this
Court to consider the ambit of
national and provincial powers conferred by the Constitution and their
interrelation where, as here,
the national legislature is said to encroach on
an exclusive provincial competence.  That requires a determination of the scope
of the exclusive provincial legislative competence within the functional area
of “liquor licences”, which in turn requires consideration
of the national and
provincial context against which that exclusive competence is afforded. Â
Whether the Bill, or parts of it,
should properly be characterised as a liquor
licensing measure must also be considered.
[39]
     The
first provision of the Constitution constitutes the Republic of South Africa as
“one, sovereign, democratic state”.
7
1
  The unitarian emphasis of this
provision is however not absolute, since it must be read in conjunction with
the further provisions
of the Constitution, which show that governmental power
is not located in national entities alone.  That appears particularly from
section 40(1), in terms of which “government is constituted as national,
provincial and local spheres of government which are distinctive,
interdependent and interrelated”, and from section 43, in terms of which the
legislative authority is vested in Parliament for
the national sphere,
7
2
in the provincial
legislatures for the provincial sphere
7
3
and in municipal councils for the
local sphere.
7
4
  Section 40 is part of Chapter 3.  This introduced a “new philosophy”
7
5
to the Constitution,
namely that of cooperative government and its attendant obligations.  In terms
of that philosophy, all spheres
of government are obliged in terms of section
40(2) to observe and adhere to the principles of cooperative government set out
in
Chapter 3 of the Constitution.
7
6
[40]
     Governmental
power is thus at source distributed between the national, provincial and local
spheres of government, each of
which is subject to the Constitution, and each of
which is subordinated to the constitutional obligation to respect the
requirements
of cooperative governance.
7
7
  The latter include the duty,
imposed equally on each sphere of government, “not [to] assume any power or
function except those
conferred on them in terms of the Constitution.”
7
8
  The succeeding
provisions of the Constitution must be read and understood in this light.Â
These include particularly the chapters
setting out the distribution of
legislative power between the various spheres of government (Chapters 4
(Parliament), 6 (Provinces)
and 7 (Local Government)), and Schedules 4 and 5,
which itemise the functional areas respectively of concurrent national and
provincial
legislative competence, and of exclusive provincial competence.Â
They include also section 43, which determines the location of
the legislative
authority of the Republic, and section 44(4).  The former provision accords
Parliament legislative authority “as
set out in section 44”.
7
9
  Section 44(4) in turn
provides that —
“When exercising its
legislative authority, Parliament is bound only by the Constitution, and must act
in accordance with, and within
the limits of, the Constitution.”
[41]
     In
terms of section 44(1)(a), the national legislative authority as vested in
Parliament confers on the National Assembly
the power inter alia —
“(ii) to pass legislation
with regard to any matter, including a matter within a functional area listed
in Schedule 4, but excluding,
subject to subsection (2), a matter within a
functional area listed in Schedule 5”.
Sections 44(2) and 44(3) provide:
“
(2) Parliament may intervene, by
passing legislation in accordance with section 76 (1), with regard to a matter
falling within a functional
area listed in Schedule 5, when it is necessary—
(a)  to maintain national
security;
(b) to maintain economic
unity;
(c)  to maintain essential
national standards;
(d) to establish minimum
standards required for the rendering of services; or
(e)  to prevent
unreasonable action taken by a province which is prejudicial to the interests
of another province or to the country
as a whole.
(3) Legislation with
regard to a matter that is reasonably necessary for, or incidental to, the
effective exercise of a power concerning
any matter listed in Schedule 4 is,
for all purposes, legislation with regard to a matter listed in Schedule 4.”
[42]
     The
provision vesting the provincial legislatures with legislative competence is
also of significance.  In terms of section
104(1), the legislative authority of
a province is vested in its provincial legislature, “and confers on the
provincial legislature
the power” amongst others
8
0
to pass legislation for its province
with regard to —
“(i)
any matter within a functional area listed in Schedule 4;
(ii) any matter within a
functional area listed in Schedule 5.”
[43]
     Section
104(4) provides in parallel terms to section 44(3) that provincial legislation with
regard to a matter that is reasonably
necessary for, or incidental to, the
effective exercise of a power concerning a Schedule 4 matter is for all
purposes Schedule 4
legislation.  Determining the place of section 44(3) in the
constitutional scheme, and in particular its relationship to the exclusive
provincial legislative competences in Schedule 5, is not free from difficulty.Â
No argument concerning it was directed to us.Â
On one approach, section 44(3)
authorises an enlarged scope of encroachment on the exclusive competences by
permitting national intrusion
into Schedule 5 where this is reasonably
necessary for, or incidental to the effective exercise of a Schedule 4 power.Â
On another
approach, section 44(3) is not directed to the Schedule 5 competences
at all, but is designed to specify the ambit of national legislation
covered by
section 146, which regulates conflicts between national and provincial
legislation falling within a functional area listed
in Schedule 4.  The express
allusion in section 44(3) to Schedule 4 legislation may provide support for
this approach.  But since
(as will appear) our decision in this case does not
require a determination of this issue, no more need be said about it.
[44]
     The
provinces’ concurrent and exclusive legislative powers are set out in Schedules
4 and 5:
Schedule 4
FUNCTIONAL AREAS OF CONCURRENT NATIONAL AND
PROVINCIAL LEGISLATIVE COMPETENCE
PART A
Administration of indigenous forests
Agriculture
Airports other than international and national airports
Animal control and diseases
Casinos, racing, gambling and wagering, excluding lotteries and
sports pools
Consumer protection
Cultural matters
Disaster management
Education at all levels, excluding tertiary education
Environment
Health services
Housing
Indigenous law and customary law, subject to Chapter 12 of the
Constitution
Industrial promotion
Language policy and the regulation of official languages to the
extent that the provisions of section 6 of the Constitution expressly
confer
upon the provincial legislatures legislative competence
Media services directly controlled or provided by the provincial
government, subject to section 192
Nature conservation, excluding national parks, national botanical
gardens and marine resources
Police to the extent that the provisions of Chapter 11 of the
Constitution confer upon the provincial legislatures legislative competence
Pollution control
Population development
Property transfer fees
Provincial public enterprises in respect of the functional areas in
this Schedule and Schedule 5
Public transport
Public works only in respect of the needs of provincial government
departments in the discharge of their responsibilities to administer
functions
specifically assigned to them in terms of the Constitution or any other law
Regional planning and development
Road traffic regulation
Soil conservation
Tourism
Trade
Traditional leadership, subject to Chapter 12 of the Constitution
Urban and rural development
Vehicle licensing
Welfare services
PART B
The following local government matters to the extent set out in
section 155 (6) (a) and (7):
Air pollution
Building regulations
Child care facilities
Electricity and gas reticulation
Firefighting services
Local tourism
Municipal airports
Municipal planning
Municipal health services
Municipal public transport
Municipal public works only in respect of the needs of
municipalities in the discharge of their responsibilities to administer
functions
specifically assigned to them under this Constitution or any other
law
Pontoons, ferries, jetties, piers and harbours, excluding the
regulation of international and national shipping and matters related
thereto
Stormwater management systems in built-up areas
Trading regulations
Water and sanitation services limited to potable water supply
systems and domestic waste-water and sewage disposal systems
Schedule 5
FUNCTIONAL AREAS OF EXCLUSIVE PROVINCIAL LEGISLATIVE COMPETENCE
PART A
Abattoirs
Ambulance services
Archives other than national archives
Libraries other than national libraries
Liquor licences
Museums other than national museums
Provincial planning
Provincial cultural matters
Provincial recreation and amenities
Provincial sport
Provincial roads and traffic
Veterinary services, excluding regulation of the profession
PART B
The following local government matters to the extent set out for
provinces in section 155 (6) (a) and (7):
Beaches and amusement facilities
Billboards and the display of advertisements in public places
Cemeteries, funeral parlours and crematoria
Cleansing
Control of public nuisances
Control of undertakings that sell liquor to the public
Facilities for the accommodation, care and burial of animals
Fencing and fences
Licensing of dogs
Licensing and control of undertakings that sell food to the public
Local amenities
Local sport facilities
Markets
Municipal abattoirs
Municipal parks and recreation
Municipal roads
Noise pollution
Pounds
Public places
Refuse removal, refuse dumps and solid waste disposal
Street trading
Street lighting
Traffic and parking
[45]
     By
contrast with Schedule 5, the Constitution contains no express itemisation of
the exclusive competences of the national
legislature.  These may be gleaned
from individual provisions requiring or authorising “national legislation”
regarding specific
matters.
8
1
  They may also be derived by converse inference from
the fact that specified concurrent and exclusive legislative competences are
conferred upon the provinces, read together with the residual power of the
national Parliament, in terms of section 44(1)(a)(ii),
to pass legislation with
regard to “any matter”.  This is subject only to the exclusive competences of
Schedule 5 which are
in turn subordinated to the “override” provision in
section 44(2).  An obvious instance of exclusive national legislative
competence
to which the Constitution makes no express allusion  is foreign
affairs.
[46]
     The
list of exclusive competences in Schedule 5 must therefore be given meaning
within the context of the constitutional
scheme that accords Parliament
extensive power encompassing “any matter” excluding only the provincial
exclusive competences.Â
The wide ambit of the functional competences
concurrently accorded the national legislature by Schedule 4 creates the
potential for
overlap, not merely with the provinces’ concurrent legislative
powers in Schedule 4, but with their exclusive competences set out
in Schedule
5.  Examples of concurrent Schedule 4 competences which could overlap with
Schedule 5 competences include “trade”
and “liquor licences”; “environment” and
“provincial planning”; “cultural matters” and “provincial cultural matters”
as
well as “libraries other than national libraries”; and “road traffic
regulation” and “provincial roads and traffic.”
[47]
     Whereas
the Constitution makes provision for conflicts between national and provincial
legislation falling within a functional
area in Schedule 4,
8
2
and between national
legislation and a provincial constitution,
8
3
the sole provision made for
conflicts between national legislation and provincial legislation within the
exclusive provincial terrain
of Schedule 5 is in section 147(2), which provides
that national legislation referred to in section 44(2) prevails over Schedule
5
provincial legislation.  This suggests that the Constitution contemplates that
Schedule 5 competences must be interpreted so as
to be distinct from Schedule 4
competences, and that conflict will ordinarily arise between Schedule 5
provincial legislation and
national legislation only where the national
legislature is entitled to intervene under section 44(2).
[48]
     As
pointed out in the first
Certification Judgment
, the introduction into
the 1996 Constitution of a category of exclusive powers gave the provinces
“more powers”
8
4
than they had enjoyed under the interim Constitution.  This Court found
that Parliament’s power of intervention in the field of
these exclusive powers
was “defined and limited” by section 44(2):  “Outside that limit the exclusive
provincial power remains
intact and beyond the legislative competence of
Parliament.”
8
5
  This Court also held that, if regard is had to the nature of the exclusive
competences in Schedule 5 and the requirements of section
44(2), “the occasion
for intervention by Parliament is likely to be limited”.
8
6
[49]
     It
follows that, in order to give effect to the constitutional scheme, which
allows for exclusivity subject to the intervention
justifiable under section
44(2), and possibly to incidental intrusion only under section 44(3),
8
7
the Schedule 4 functional
competences should be interpreted as being distinct from, and as excluding,
Schedule 5 competences.  That
the division could never have been contemplated
as being absolute is a point to which I return in due course.
[50]
     The
constitution-makers’ allocation of powers to the national and provincial
spheres appears to have proceeded from a functional
vision of what was
appropriate to each sphere, and accordingly the competences itemised in
Schedules 4 and 5 are referred to as being
in respect of “functional areas”.Â
The ambit of the provinces’ exclusive powers must in my view be determined in
the light
of that vision.  It is significant that section 104(1)(b) confers
power on each province to pass legislation “for its province”
within a
“functional area”.  It is thus clear from the outset that the Schedule 5
competences must be interpreted as conferring
power on each province to
legislate in the exclusive domain only “for its province”.  From the provisions
of section 44(2) it
is evident that the national government is entrusted with
overriding powers where necessary to maintain national security, economic
unity
and essential national standards, to establish minimum standards required for
the rendering of services, and to prevent unreasonable
action by provinces
which is prejudicial to the interests of another province or to the country as
a whole.  From section 146 it
is evident that national legislation within the
concurrent terrain of Schedule 4 that applies uniformly to the country takes
precedence
over provincial legislation in the circumstances contemplated in
section 44(2), as well as when it —
(a) deals with a matter
that cannot be regulated effectively by provincial legislation;
(b) provides necessary
uniformity by establishing norms and standards, frameworks or national policy;
(c) is necessary for the
protection of the common market in respect of the mobility of goods, services,
capital and labour, for the
promotion of economic activities across provincial
boundaries, the promotion of equal opportunity or equal access to government
services,
or the protection of the environment.
[51]
     From
this it is evident that where a matter requires regulation inter-provincially,
as opposed to intra-provincially, the
Constitution ensures that national
government has been accorded the necessary power, whether exclusively or
concurrently under Schedule
4, or through the powers of intervention accorded
by section 44(2).  The corollary is that where provinces are accorded exclusive
powers these should be interpreted as applying primarily to matters which may
appropriately be regulated intra-provincially.
[52]
     It
is in the light of this vision of the allocation of provincial and national
legislative powers that the inclusion of the
functional area “liquor licences”
in Schedule 5A must in my view be given meaning.  That backdrop includes the
express concurrency
of national and provincial legislative power in respect of
the functional area of “trade” and “industrial promotion” created
by Schedule
4.
[53]
     According
to the New Shorter Oxford Dictionary, “trade” in its ordinary signification
means the “[b]uying and selling
or exchange of commodities for profit,
spec.
between nations; commerce, trading, orig. conducted by passage or travel
between trading parties”.
8
8
  Nothing in Schedule 4 suggests that the term should
be restricted in any way, and the Western Cape government did not contend that
Parliament’s concurrent competence in regard to “trade” should be limited to
cross-border or inter-provincial trade.  It follows
that in its ordinary
signification, the concurrent national legislative power with regard to “trade”
includes the power not only
to legislate intra-provincially in respect of the
liquor trade, but to do so at all three levels of manufacturing, distribution
and
sale.
[54]
     The
concurrent legislative competence in regard to “industrial promotion” should in
my view be given a similarly full
meaning as conferring on the national
legislature and the provinces the power to initiate, advance and encourage all
branches of
trade and manufacture.
8
9
  But the exclusive provincial
competence to legislate in respect of “liquor licences” must also be given
meaningful content,
and, as suggested earlier, the constitutional scheme
requires that this be done by defining its ambit in a way that leaves it
ordinarily
distinct and separate from the potentially overlapping concurrent competences
set out in Schedule 4.
[55]
[    As
Mr Trengove, relying on dictionary definitions and the judgment of Innes J in
Fick
v Woolcott and Ohlsson’s Cape Breweries Ltd
9
0
correctly submitted, a liquor
licence is the permission that a competent authority gives to someone to do
something with regard to
liquor that would otherwise be unlawful.  The activity
in question, as emerges from the judgment of Innes J, is usually the sale
of
liquor at specified premises.  It also seems to me that the term “liquor
licences” in its natural signification encompasses
not only the grant or
refusal of the permission concerned, but also the power to impose conditions
pertinent to that permission,
as well as the collection of revenue that might arise
from or be attached to its grant.
[56]
     The
Western Cape government contended that liquor licences are never an end in
themselves, but control and regulate the production,
distribution and sale of
liquor in pursuit “of yet further social, economic and financial objectives”.Â
Accordingly, the Province
contended, the authors of the Constitution must have
intended the term “liquor licences” in Schedule 5A to encompass all legislative
means and ends appurtenant to the liquor trade at all levels of production,
manufacture and sale, and that these were intended to
be reserved, outside the
circumstances envisaged by section 44(2), for the exclusive competence of the
provinces.  This submission
cannot in my view be accepted.  In the first place,
the field of “liquor licences” is narrower than the liquor trade.  The
Schedule
does not refer simply to “liquor” or the “liquor trade” or the “liquor
industry”.  Instead it uses the phrase
“liquor licences”.  There is a range of
legislation in South Africa regulating the liquor trade.  Production,
marketing, export
and import of wine and spirits is regulated in terms of two
important statutes, the Wine and Spirit Control Act, 47 of 1970 and the
Liquor
Products Act, 60 of 1989
.  These are primarily concerned with aspects of the
liquor trade and industry, and not with liquor licensing itself.  Legislation
concerning the production of liquor products, including quality control,
marketing and import and export of such products would fall
within the
concurrent competence of trade and/or industrial promotion, rather than within
the exclusive competence of liquor licences.
[57]
     The
structure of the Constitution in my view suggests that the national government enjoys
the power to regulate the liquor
trade in all respects other than liquor
licensing.  For the reasons given earlier, this in my view includes matters
pertaining to
the determination of national economic policies, the promotion of
inter-provincial commerce and the protection of the common market
in respect of
goods, services, capital and labour mobility.
[58]
     For
his part, Mr Wallis contended that the term “liquor licences” must be
understood to apply only to the retail sale
of liquor.  But the basis of his
submission that the history of liquor licensing legislation in South Africa
shows that the area
of application of liquor licences was not the whole field
of production, distribution and sale of liquor, but only the narrower field
of
the supply of liquor to the public or consumers, cannot be sustained.  This is
apparent from the provisions of the earlier legislation,
which plainly
encompass also the production of liquor.
9
1
  I would in any event have grave
reservations about undertaking a task of constitutional interpretation as
though it depended on
the prior meaning our legislation or case law attributed
to any particular term.
[59]
     Even
within the retail tier of the liquor trade, Mr Wallis sought to diminish the area
the Bill occupied within the notional
common terrain by contending that the
province still had legislative leeway within which to exercise its exclusive
competence.Â
In so far as the Bill infringed the provinces’ exclusive
competence in regard to licensing of retail liquor sales, Mr Wallis contended
in reliance on a number of Canadian cases that its “pith and substance” lay in
its radical restructuring of the liquor industry
through the creation of the
three-tier system, which enabled a variety of trade and other issues falling
within Parliament’s exclusive
or concurrent competence to be addressed.Â
Against this background, Mr Wallis contended that the Bill’s system of
registration
was “purely incidental” to the means the Bill chose to address
other, competent, issues and that its infringement, if any, on
the area of
“liquor licences” was accordingly permissible under the Constitution.  Mr
Wallis finally contended that the Minister
had in any event established that
the legislation was “necessary” for a number of purposes under section 44(2).
[60]
     It
is not necessary for the purposes of this judgment to consider the utility or
applicability of the Canadian “pith and
substance” cases to the development of
an indigenous South African jurisprudence regarding national and provincial
legislative
competences.  It is sufficient to say that although our
Constitution creates exclusive provincial legislative competences, the
separation
of the functional areas in Schedules 4 and 5 can never be absolute:
“Whenever a legislature’s
authority is limited some rule must be adopted to address the possibility that
a [single] law may touch
upon subject matter [both] within and outside
legislative competence.”
9
2
[61]
     That
Schedule 4 legislation may impact on a Schedule 5 functional area finds
recognition on one reading of section 44(3).Â
Whatever its true reading
9
3
this provision was not
designed to undermine the Schedule 5 competences.  They retain their full
meaning and effect, except where
encroachment by national legislation would in
fact be “reasonably necessary for, or incidental to” the effective exercise of
a Schedule 4 power.  Since however no national legislative scheme can ever be
entirely water-tight in respecting the excluded provincial
competences, and
since the possibility of overlaps is inevitable, it will on occasion be necessary
to determine the main substance
of legislation, and hence to ascertain in what
field of competence its substance falls; and, this having been done, what it
incidentally
accomplishes.  This entails that a Court determining compliance by
a legislative scheme with the competences enumerated in Schedules
4 and 5 must
at some stage determine the character of the legislation.  It seems apparent
that the substance of a particular piece
of legislation may not be capable of a
single characterization only, and that a single statute may have more than one
substantial
character.  Different parts of the legislation may thus require
different assessment in regard to a disputed question of legislative
competence.
[62]
[    In
Ex Parte Speaker of the KwaZulu-Natal Provincial Legislature: In re
KwaZulu-Natal Amakhosi and Iziphakanyiswa Amendment Bill of 1995
9
4
, this Court had to
determine whether a provincial Bill fell within the legislative competence
granted the provinces in Schedule 6
of the interim Constitution.  Chaskalson P
rejected the argument that the “purpose” of legislation was irrelevant to the
constitutionality
inquiry:
“It may be relevant to
show that although the legislation purports to deal with a matter within
Schedule 6 its true purpose and
effect is to achieve a different goal which
falls outside the functional areas listed in Schedule 6.  In such a case a
Court would
hold that the province has exceeded its legislative competence.
9
5
  It is necessary, therefore, to consider whether the
substance of the legislation, which depends not only on its form but also on
its purpose and effect, is within the legislative competence of the
KwaZulu-Natal provincial legislature.”
9
6
[63]
     The
question therefore is whether the substance of the Liquor Bill, which depends
not only on its form but also on its purpose
and effect, is within the
legislative competence of Parliament.  The Bill’s objects are set out in
section 2 thus:
“The objects of this Act
are to maintain economic unity and essential national standards in the liquor
trade and industry, to encourage
and support the liquor industry and to manage
and reduce the socio-economic and other costs of excessive alcohol consumption
by —
(a)  establishing
a national and uniform administrative and regulatory framework within which the
liquor industry can conduct its
business;
(b)  creating
an environment in which —
(i) the entry of new
participants into the liquor industry is facilitated;
(ii) appropriate steps are
taken against those selling liquor outside the administrative and regulatory
framework established in terms
of this Act;
(iii) those involved in
the liquor industry may attain and maintain adequate standards of service
delivery;
(iv) community
considerations on the registration of retail premises are taken into account;
and
(v) the particular
realities confronting the liquor industry can be addressed;
and
(c) promoting a spirit of
co-operation and shared responsibility within all spheres of government, and
among other interested persons
in their dealings with consumers of liquor and
in their attempt to address the socio-economic costs and health and other related
problems associated with excessive alcohol consumption.”
[64]
     The
Bill seeks to attain these objects, amongst others, through the establishment
of a National Liquor Advisory Committee,
drawn from a broad spectrum of persons
in the public and private sectors, including all sectors of the liquor industry
and a wide
range of the functional areas of government.  This Committee is to
advise the Minister on various matters.  These include “the
facilitation of the
advancement, upliftment and economic empowerment of persons or groups or
categories of persons disadvantaged
by unfair discrimination”, “the consumption
of alcohol amongst the youth”; and “the problems that excessive alcohol
consumption
has on public health and family and social life”.
9
7
Â
[65]
     As
described earlier, the Bill also prohibits vertical cross-holdings within the
liquor industry.  The specific means it
employs is the establishment of a
national system of registration under a National Liquor Authority.  In terms of
the registration
system, no person may be registered in more than one of the
three tiers.  The attainment of this objective is, according to the
Minister’s
affidavit, one of the prime reasons for the Bill’s enactment, and the Bill’s
national system of registration is
essential to it.  The Minister underscores
the necessity for these measures by alluding to the history of racism in the
structure
and control of the liquor trade, in regard to which the National
Liquor Advisory Committee is empowered to advise him.
[66]
     The
Bill seeks to create the “national and uniform administrative and regulatory
framework”, referred to in section 2(a),
through uniform licensing conditions
at national level for manufacturers and distributors.
9
8
  It also seeks to attain
this goal by requiring that provincial legislatures pass legislation to
establish provincial liquor authorities
9
9
which will consider and approve
applications for retail and special event licences,
10
0
and by prescribing the
application procedure for retail registration in great detail.
10
1
[67]
     The
question is whether the substance of this legislation falls within the excluded
field of “liquor licences”, in which
case the justifications itemised in
section 44(2) will have to be shown; or whether it falls within a permitted
competence of Parliament
even without such justification.  In answering this
question, as indicated above,
10
2
it does not seem to me that the objective should be
to subject the Bill to a uniform analysis directed at yielding a single
characterization.
[68]
     The
true substance of the Bill is in my view directed at three objectives.  These
are: (a) the prohibition on cross-holdings
between the three tiers involved in
the liquor trade, namely producers, distributors and retailers; (b) the
establishment of uniform
conditions, in a single system, for the national
registration of liquor manufacturers and distributors; and, in a further
attempt
at establishing national uniformity within the liquor trade, (c) the
prescription of detailed mechanisms to provincial legislatures
for the
establishment of retail licensing mechanisms.
[69]
     Regarding
(a):  In my view the Bill’s prohibition of cross-holdings falls within the
national legislature’s competence
to regulate trade.  On any approach, the
vertical and horizontal regulation of the liquor trade, and the promotion of
racial equity
within the trade, are legislative ends which fall within the
functional competence Schedule 4 accords the national Parliament under
the
headings of trade and industrial promotion.  I did not understand counsel for
the Western Cape government to contest this.Â
The Bill, however, attains this
objective by employing a specific means, namely a system of registration which
is in all material
respects identical to a licensing system.  In addition, the
Bill accords to national government regulatory functions in regard to
liquor
licensing in the production and distribution sphere.  That the ends the
national legislature so seeks to attain fall within
its power does not
automatically entail that the means it has chosen, namely a system of liquor
licensing, are competent.  For that
conclusion to be reached, the national
government must show that the means is “necessary” for one of the purposes
specified in
section 44(2), or, on one reading of section 44(3),
10
3
that they are reasonably
necessary for, or incidental to the effective exercise of a Schedule 4 power.
[70]
     Regarding
(b) (the national system of registration for producers and wholesalers): Persuasive
justification for understanding
“liquor licences” more narrowly than the
reading advanced by the Western Cape government appears, as indicated earlier,
from
the scheme of the Constitution.  These suggest that the primary purport of
the exclusive competences, including “liquor licences”,
lies in activities that
take place within or can be regulated in a manner that has a direct effect upon
the inhabitants of the province
alone.  In relation to “liquor licences”, it is
obvious that the retail sale of liquor will, except for a probably negligible
minority of sales that are effected across provincial borders, occur solely
within the province.  The primary and most obvious signification
of the
exclusive competence therefore seems to me to lie in the licensing of retail
sale of liquor.
[71]
     As
far as the Bill’s “three-tier” structure is concerned, the same considerations
suggest that manufacturing or production
of liquor was not intended to be the
primary field of “liquor licences”.  The manufacturing and wholesale trades in
liquor have
a national and also international dimension.  Manufacturers and
wholesalers ordinarily trade across the nation, and some trade both
nationally
and internationally.  Little, if any, liquor production is directed to an intra-provincial
market only.  On the contrary,
in large measure, the production of liquor —
whether brewing of beer (which on the evidence before us occurs largely in the
northern
provinces), or viticulture and wine production (which occurs
“overwhelmingly” within the Western Cape), or the production of
vodka, cane
spirit and gin (which occurs “mostly” in KwaZulu-Natal) — is necessarily
directed at an extra-provincial or international
market.
[72]
     The
same considerations in my view apply in general to the distribution of liquor,
where the scale of distribution is likely,
in almost all cases, to be inter- as
opposed to intra-provincial.  The regulation and control of liquor
distribution, on this approach,
therefore  falls outside the primary
signification of the exclusive competence.  If production and distribution of
liquor were
to be regulated by each province, manufacturers and distributors
would require licences from each province for the purpose of conducting
national trading, and possibly a national licence for export.
[73]
     These
considerations point to the conclusion that the provincial exclusive power in
relation to “liquor licences” was
in the first instance not intended to
encompass manufacturing and distribution of liquor.  The exclusive competences
in Schedule
5 all point to intra-provincial activities and concerns only, and
exclude those with a national dimension.  Of the twelve exclusive
competences
itemised in Schedule 5A, nine contain express terms confining their ambit to
provincial or non-national issues.  This
obviously signifies that “liquor
licences”, too, must mean intra-provincial liquor licences.
[74]
     But
it is unnecessary to conclude that the competence in regard to “liquor
licences” does not extend to intra-provincial
production and distribution
activities since the national government has in my view in any event shown
that, if the exclusive provincial
legislative competence in respect of “liquor
licences” extends to licensing production and distribution, its interest in
maintaining
economic unity authorises it to intervene in these areas under
section 44(2).  “Economic unity” as envisaged in section 44(2)
must be
understood in the context of our Constitution, which calls for a system of
co-operative government, in which provinces are
involved largely in the
delivery of services and have concurrent legislative authority in everyday
matters such as health, housing
and primary and secondary education.  They are
entitled to an equitable share of the national revenue, but may not levy any of
the
primary taxes, and may not impose any tax which may “materially and
unreasonably” prejudice national economic policies, economic
activities across
provincial boundaries, or the national mobility of goods, services, capital or
labour.
10
4
  Our constitutional structure does not contemplate that provinces will
compete with each other.  It is one in which there is to
be a single economy
and in which all levels of government are to co-operate with one another.  In
the context of trade, economic
unity must in my view therefore mean the
oneness, as opposed to the fragmentation, of the national economy with regard
to the regulation
of inter-provincial, as opposed to intra-provincial, trade.Â
In that context it seems to follow that economic unity must contemplate
at
least the power to require a single regulatory system for the conduct of trades
which are conducted at a national (as opposed
to an intra-provincial) level.
[75]
     Given
the history of the liquor trade, the need for vertical and horizontal
regulation, the need for racial equity, and the
need to avoid the possibility
of multiple regulatory systems affecting the manufacturing and wholesale trades
in different parts
of the country, in my view the “economic unity” requirement
of section 44(2) has been satisfied.  Indeed, many of the considerations
mentioned earlier in relation to the primary signification of the term “liquor
licences” suggest the conclusion that manufacture
and distribution of liquor
require national, as opposed to provincial, regulation.
[76]
     The
Minister’s affidavit states in this regard that duplicated or varying
provincial licensing requirements would be “unduly
burdensome” for manufacturers
and that it was therefore “economically imperative that control over the
activities of manufacturers
should take place at national level”.  He states
that major industries, including the liquor industry “as a single integrated
industry” should not have to “run the risk of fragmentation arising out of a
variety of differing regulatory regimes being imposed
upon their operations in
different provinces”, including what he described as the deleterious effects of
“cross-border arbitrage”
between competing provinces.  He avers that “[w]ithout
a national system of regulation and a national standard to which wholesalers
will have to adhere the results would be chaotic”: “The spectre arises of a
single business operation having to be separately
licensed on differing terms
and conditions in different parts of South Africa.”
[77]
     For
the reasons given earlier, the Constitution entrusts the legislative regulation
of just such concerns to the national
Parliament, and I am of the view that the
Minister has shown, at least in regard to manufacturing and distribution of
liquor, that
the maintenance of economic unity necessitates for the purposes of
section 44(2)(b) the national legislature’s intervention in
requiring a
national system of registration in these two areas.  The manufacturing and
wholesale distribution of liquor (national
and international sales) are
important industries, which provide employment for a substantial number of
persons.  They also generate
foreign income.  That these trades require control
is obvious, and the most effective way of doing so is through a national
regulatory
system.  This enables the government to regulate the trade
vertically and horizontally, to set common standards for all traders
concerned,
and enables traders to conduct their activities with a single licence,
according to a single regulatory system.  The
Western Cape government’s denial
of the Minister’s averment that the production and distribution tiers
necessitate a national
approach can thus not be sustained.
[78]
     The
provisions of section 30, however, require different consideration.  They deal
with the award of retail licences, and
do so by prescribing in some detail to
the provincial legislatures what structures should be set up, and how those
structures should
go about considering and awarding liquor licences.  I will
accept in the Minister’s favour, as contended by Mr Wallis, that the
provincial
liquor boards are entrusted with considerable leeway in applying what the Bill
calls “community considerations”
10
5
on the registration of retail
premises.  Nevertheless, on the analysis advanced above, the licensing
competence in respect of retail
sales of liquor falls squarely within the
exclusive provincial legislative power afforded by Schedule 5.  Section 30 and
its attendant
apparatus can therefore be justified only if it is established
that they are “necessary” under section 44(2), or, on one reading
of section
44(3), that they are reasonably necessary for, or incidental to the justified substance
of the Bill.Â
[79]
     While
the Minister’s evidence in my view shows that the national interest
necessitated legislating a unified and comprehensive
national system of
registration for the manufacture and distribution of liquor, it failed to do so
in respect of its retail sale.Â
There, he averred only that “consistency of
approach” is “important”.  This may be true.  But importance does not amount
to
necessity, and the desirability from the national government’s point of view of
consistency in this field cannot warrant national
legislative intrusion into
the exclusive provincial competence, and no other sufficient grounds for such
an intrusion were advanced.
[80]
     It
was not suggested by the Minister, nor raised in argument by Mr Wallis on his
behalf, that the intrusion into the exclusive
provincial competence of “liquor
licences” was permissible in terms of section 44(3).  Nor was this issue raised
by the President
in his referral to this Court.  In the circumstances it is not
necessary to deal with this question.  If section 44(3) applies
to national
legislative intrusions into the exclusive provincial competences,
10
6
I am inclined to the view
that the phrase “reasonably necessary for, or incidental to” should be
interpreted as meaning “reasonably
necessary for and reasonably incidental
to”.  Whatever meaning is to be assigned to this formulation, and I prefer to
express
no opinion on it, the scale of the intrusion the Bill envisages upon
the provinces’ exclusive competence in regard to retail liquor
licences cannot
be justified.
[81]
     The
deponent on behalf of the Western Cape government emphasised the “positive features
of provincial differentiation”,
and contended that the Constitution envisaged
that the provincial system of government with its attendant exclusive
legislative powers
would lead, over time, to “differences between provinces’
approaches to the matters within their legislative and executive competence”.Â
The overall constitutional scheme, as indicated earlier, in my view provides
warrant for this view in the field of retail liquor
sales.  The national
government has accordingly not shown that the retail structures sought to be
erected by the Bill are reasonably
necessary for or incidental to the national
system created for producers (manufacturers) and distributors.
[82]
     The
same considerations seem to me to apply to the Bill’s provisions regarding
micro-manufacturers
10
7
and manufacturers of sorghum beer,
10
8
who are permitted to sell
the liquor produced by them “directly to the public for consumption on and off
the registered premises,
as prescribed”.
10
9
  In effect, these provisions confer
national permission for retail sales in circumstances where it does not seem to
me that the
national government has made a case under section 44(2) for
intervening in the provinces’ exclusive legislative competence.  The
provisions
of section 46(2) also require scrutiny.  These permit a manufacturer to sell
the liquor produced “directly to the public
for consumption on and off the
registered premises, subject to the terms and conditions that the relevant
authority may determine”.Â
To the extent that this exempts wine farms, for
instance, from the national prohibition on producers holding retail licences,
it
lies within the competence of national government.  But in so far as this
provision precludes provinces from also requiring provincial
licences for what
is in effect retail selling, it too lies beyond the competence of the national
legislature.
[83]
     The
provisions of section 44(2) have also not been satisfied in regard to the national
regulation of micro-manufacturers
of liquor, whose businesses may be
essentially provincial in character.
[84]
     This
is not to say that in the absence of provincial legislation a national scheme providing
for minimum standards in the
field of retail sales, to operate in default of
provincial provisions in this regard, would not be competent as being
“necessary”
within section 44(2).  It was common cause that none of the
provinces had in the exercise of their exclusive competence enacted
any
legislation in the field of “liquor licences”.  If Parliament deems it
necessary to repeal the existing liquor legislation,
including the Liquor Act
of 1989, in the exercise of its national competence, the resulting void, if not
filled by the provinces,
may well entitle Parliament to provide by way of
legislation for such minimum standards and procedures.  It is at present
however
unnecessary to consider that question.
[85]
     The
Province also objected to the Bill in as much as it directs provincial
legislatures to pass legislation in a specified
form to create provincial
liquor authorities to deal with retail liquor licensing.
11
0
  This was not included in
the President’s reservations, and it is therefore not necessary to deal with
it.
[86]
     To
summarise: I conclude that if the exclusive provincial legislative competence
regarding “liquor licences” in Schedule
5 applies to all liquor licences, the
national government has made out a case in terms of section 44(2) justifying
its intervention
in creating a national system of registration for
manufacturers and wholesale distributors of liquor and in prohibiting
cross-holdings
between the three tiers in the liquor trade.  No case has
however been made out in regard to retail sales of liquor, whether by
retailers
or by manufacturers, nor for micro-manufacturers whose operations are
essentially provincial.  The Minister has to this
extent failed to establish
that Parliament had the competence to enact the Liquor Bill and it is therefore
unconstitutional.
Costs
[87]
     Neither
of the parties represented before this Court asked for costs.  No order is
therefore necessary.
Conclusion and Order
[88]
     The
decision of this Court is that to the extent indicated in this judgment the
Liquor Bill  [B 131B-98] is unconstitutional.
Chaskalson P, Langa DP, Ackermann, Goldstone, Madala,
Mokgoro, Ngcobo, O’Regan, Sachs and Yacoob JJ concur in the judgment of Cameron
AJ.
For the
Government of the Western Cape:             W Trengove SC, A Breitenbach
Instructed by De Klerk
& Van Gend.
For the
Minister of Trade and Industry:                        MJD Wallis SC, M
Govindsamy
Instructed by Cheadle,
Thompson and Haysom.
1
         Â
Section 84 of the
Constitution of the Republic of South Africa, Act 108 of 1996, sets out the
powers and functions of the President.Â
It provides in part:
“(1) The President has the powers entrusted by the Constitution and
legislation, including those necessary to perform the functions
of Head of
State and head of the national executive.
(2) The President is responsible for—
                (a)           assenting
to and signing Bills;
                (b)           referring
a Bill back to the National Assembly for reconsideration of the Bill’s
constitutionality;
                (c)           referring
a Bill to the Constitutional Court for a decision on the Bill’s
constitutionality;
(d) - (k)”.
2
         Â
Section 44(2)
provides:
“Parliament may intervene, by passing legislation in accordance with
section 76 (1), with regard to a matter falling within a functional
area listed
in Schedule 5, when it is necessary—
                (a)
to maintain national security;
                (b)
to maintain economic unity;
                (c)
to maintain essential national standards;
                (d)
to establish minimum standards required for the rendering of services; or
(e) to prevent unreasonable action taken by a province which is
prejudicial to the interests of another province or to the country
as a whole.”
3
         Â
In terms
of section 2 of the Constitution, the Constitution is “the supreme law of the
Republic” and “law or conduct inconsistent
with it is invalid”.
4
         Â
Section
38 defines standing under the Bill of Rights (Chapter 2) to seek relief;Â
section 172 defines the powers of courts in constitutional
matters.
5
         Â
Section 80 reads:
“80.
Application by members of National Assembly to
Constitutional Court.
—(1) Members of the National Assembly may apply to the
Constitutional Court for an order declaring that all or part of an Act of
Parliament is unconstitutional.
(2) An application—
(a) must be supported by at least one third of the members of the
National Assembly; and
(b) must be made within 30 days of the date on which the President
assented to and signed the Act.
(3) The Constitutional Court may order that all or part of an Act
that is the subject of an application in terms of subsection (1)
has no force
until the Court has decided the application if—
(a) the interests of justice require this; and
(b) the application has a reasonable prospect of success.
(4) If an application is unsuccessful, and did not have a reasonable
prospect of success, the Constitutional Court may order the applicants
to pay
costs.
Provincial
statutes may be challenged under the comparable provisions of section 122.
6
         Â
Comparable
provisions in section 121 permit provincial Premiers to refer provincial Bills
to the Constitutional Court for decisions
on their constitutionality.
7
         Â
Article
III of the US Constitution has been interpreted as excluding the courts from
deciding abstract or hypothetical questions:Â
Tribe
American Constitutional
Law
2 ed (The Foundation Press, Inc., 1988) at 73.
8
   Â
Dicey
An Introduction
to the Study of the Law of the Constitution
10 ed (MacMillan, 1959) at
69-70:
“Parliament can legislate on any topic whatever which, in the
judgment of Parliament, is a fit subject for legislation.  There
is no power
which under the English Constitution, can come into rivalry with the
legislative sovereignty of Parliament.”
A Bill is finally passed once the Royal Assent has been given.  The
sovereign right of veto has not been exercised since the reign
of Queen Anne:
Bradley and Ewing
Constitutional and Administrative Law
(Longman, 1993)
at 201.
The new Human Rights
Act, 1988 creates a non-judicial vetting procedure for determining compliance
with the European Convention on
Human Rights and Fundamental Freedoms.
9
         Â
In
Osborne
v The Commonwealth and Another
[1911] HCA 19
;
(1911) 12 CLR 321
at 355, the High Court of
Australia held that it “can have no cognizance of proposed laws” (concurring
judgment of O’Connor
J), while in
In Re the Judiciary and In Re the
Navigation Act
[1921] HCA 20
;
(1921) 29 CLR 257
, the Court refused to render an advisory
opinion on the ground that it is a non-judicial function.  See generally Lane
Lane’s
Commentary on the Australian Constitution
(The Law Book Co Ltd, 1986).
10
        Â
See
generally Joseph
Constitutional and Administrative Law in New Zealand
(The Law Book Co Ltd, 1993).
11
  Â
Section
93(1)[2] and [2a] of the German Basic Law.  See Kommers
The Constitutional
Jurisprudence of the Federal Republic of Germany
2ed (Duke University
Press, 1997) at 13-14, and Currie
The Constitution of the Federal Republic
of Germany
(The University of Chicago Press, 1994) at 168 and especially
337.
12
        Â
Constitution
of Ireland, 1937, article 26.
13
        Â
Kelly
The
Irish Constitution
3ed (Butterworths, 1994) at 216.
14
        Â
This
institution, entrusted with constitutional interpretation, is not strictly a
court of law, but operates like a Constitutional
Court: Bell
French
Constitutional Law
(Oxford University Press, 1992) at 41.
15
        Â
Id.
16
        Â
Hogg
Constitutional
Law of Canada
3ed (Carswell, 1992) at 216.
17
        Â
Id at 219.
18
        Â
Article
143 of the Constitution of India, 1950.
19
        Â
(1959)
SCR 995
at 1018.
20
        Â
Sections
121 and 122 provide in parallel for similar referrals and challenges by
respectively provincial Premiers and members of provincial
legislatures.Â
21
        Â
Section
79 reads:
“79.
Assent to Bills.
—(1) The President must either assent to
and sign a Bill passed in terms of this Chapter or, if the President has
reservations about
the constitutionality of the Bill, refer it back to the
National Assembly for reconsideration.
(2) The joint rules and orders must provide for the procedure for
the reconsideration of a Bill by the National Assembly and the participation
of
the National Council of Provinces in the process.
(3) The National Council of Provinces must participate in the
reconsideration of a Bill that the President has referred back to the
National
Assembly if—
                (a) the President’s reservations
about the constitutionality of the Bill relate to a procedural matter
that
involves the Council; or
                (b) section 74 (1), (2) or (3) (b) or
76 was applicable in the passing of the Bill.
(4) If, after reconsideration, a Bill fully accommodates the
President’s reservations, the President must assent to and sign the
Bill; if
not, the President must either—
                (a) assent to and sign the Bill; or
                (b) refer it to the Constitutional
Court for a decision on its constitutionality.
(5) If the
Constitutional Court decides that the Bill is constitutional, the President
must assent to and sign it.”
22
        Â
Section
167(4)(b) refers also to the comparable power under section 121 in regard to
provincial Bills.
23
        Â
Section 172(1)
provides:
“When deciding a constitutional matter within its power, a court —
(a) must declare that any law or conduct that is inconsistent with
the Constitution is invalid to the extent of its inconsistency;
and
                (b)
may make any order that is just and equitable, including —
(i) an order limiting the retrospective effect of the declaration of
invalidity; and
(ii) an order
suspending the declaration of invalidity for any period and on any conditions,
to allow the competent authority to correct
the defect.”
24
        Â
See
In
re the Kerala Education Bill, 1957
, note 19 above.
25
        Â
Constitution
of the Republic of South Africa Act 200 of 1993 (“the interim Constitution”).
26
        Â
Section
71(2) and (3);
Ex Parte Chairperson of the Constitutional Assembly: In re
Certification of the Constitution of the Republic of South Africa,
[1996] ZACC 26
;
1996
1996
(4) SA 744
(CC);
1996 (10) BCLR 1253
(CC) at paras 17-18.
27
        Â
Ex
Parte Chairperson of the Constitutional Assembly:  In re Certification of the
Amended Text of the Constitution of The Republic
of South Africa,
1996
1997(2) SA 97
(CC); 1997(1) BCLR 1 (CC) at para 8:  “The sound
jurisprudential basis for the policy that a Court should adhere to its previous
decisions unless they are shown to be clearly wrong is no less valid here than
is generally the case. . .”
28
        Â
Section
73.
29
        Â
Section
74.
30
        Â
Section
75.
31
        Â
Section
76.
32
        Â
Section
77.
33
        Â
Section
78.
34
        Â
Section
65(1)(a).
35
        Â
Section
65(1)(b).
36
        Â
See para
39 below.
37
        Â
Wine and
Spirit Control Act, 47 of 1970; Liquor Act, 27 of 1989;
Liquor Products Act, 60
of 1989
.
38
        Â
Government
Gazette
18135, GN 1025, 11 July 1997.
39
        Â
In terms
of
section 94
of Act 30 of 1928:
“Save as is otherwise specially provided by this Act, no person
shall supply or deliver any liquor to any native, and no native
shall obtain or
be in possession of, any liquor: Provided that save in any area proclaimed by
the Governor General as an area to
which the proviso shall not apply, a native
may on a written order dated and signed by his
bona fide
employer, and
setting forth in legible characters such employer’s full name and address,
obtain the delivery of liquor for conveyance
to such employer, if such employer
is not a person to whom it is unlawful to supply liquor.”
This was to be read with section 19(1) of the Natives (Urban Areas)
Act, 21 of 1923.
Section 95 provided:
“Save as is otherwise provided by this Act-
(a) in the Provinces of the Transvaal and Orange Free State no
person shall sell or supply or deliver any liquor to any Asiatic or
coloured
person, and no Asiatic or coloured person shall obtain or be in possession of
liquor; and
(b) in the province of Natal no Asiatic shall be supplied with or
obtain liquor save for consumption on premises licenced under this
Act for the
sale thereof, or be in possession of liquor off such premises:
Provided that
save in any area proclaimed by the Governor-General as an area to which the
proviso shall not apply, an Asiatic or coloured
person may, on a written order
dated and signed by his
bona fide
employer and setting forth in legible
characters such employers full name and address, obtain the delivery of liquor
for conveyance
to such employer, if such employer is not a person to whom it is
unlawful to supply liquor.”
40
        Â
Sections 97 and 98 of the Liquor Act
30 of 1928 required a written order of a duly qualified medical practitioner,
stating that the
black person specified was in a condition of dangerous illness
and as a consequence needed to be administered with liquor, or was
suffering
from an illness that necessitated the administration of liquor as means of
restoring health.
41
        Â
Section 99 of Act 30 of 1928 required
certification by a magistrate that the black person was a minister of religion
and
bona fide
required the liquor for sacramental purposes.
42
        Â
Section 101 of Act 30 of 1928 provided
that a minister, a commissioned public officer or a magistrate  could issue a
black applicant
with an annually renewable letter of exemption, entitling him
to buy stated quantities of liquor subject to stated conditions.Â
Magistrates
were required to satisfy themselves that applicants were living in accordance
with “White standards”: see Horrell
M (ed)
Laws Affecting Race Relations
(Pietermaritzburg 1978) at 134.
43
        Â
Referred to in the legislation first
by the opprobrious term “kaffir beer”, and later as “Bantu beer”.
44
        Â
Section
32 of the Native (Urban Areas) Act 21 of 1923 provided:
“Save as is provided in paragraph (a) of section 134 of Act 30 of
1928, no person shall introduce into a location, Native village
or Native
hostel, any liquor and no person shall be in possession of any liquor in within
these places, unless such liquor:-
(a) is for medical purposes, supported by written order of a duly
qualified medical practitioner, specifying this purpose by the person
specified;
(b) is in the opinion of the officer in charge of the location etc.,
for sacramental purposes;
(c) is kaffir beer.”
The possession
of umqombothi was made lawful under sections 33, 34 and 35 of Act 21 of
1923.
45
        Â
Sections 124 and 134 of the Liquor
Act 30 of 1928.
46
        Â
Sections 125and 126 of the Liquor Act
30 of 1928.
47
        Â
In terms of Chapter XVII Part B of
the Liquor Act 30 of 1928 (particularly sections 161(c)and (d); 164(b) and (c)
and 166(l), (m)
and (p)), read with section 25 of the Natives (Urban Areas) Act
21 of 1923.
48
        Â
Horrell M (ed)
Laws Affecting Race
Relations
(Pietermaritzburg 1978) at 136.
49
        Â
Ibid.
50
        Â
Restrictions on the purchase of
liquor for off-consumption by coloured and Indian persons were removed; coloured
and Indian persons
were allowed to purchase liquor for on-consumption in any
licensed premises which admitted them but they were to be served separately
from whites; Africans were allowed to purchase liquor from holders of
off-consumption licences; subject to various  conditions Africans
were
permitted to sell liquor in African areas to any African for on- or
off-consumption; Indians and coloureds were permitted to
hold licences for the
sale of liquor from premises in their group areas or in areas predominantly
occupied by persons of their racial
group:  Horrell above note 48 at 138.
51
        Â
Section
2(a).
52
        Â
Section
9.
53
        Â
Section
27(a) and (b).
54
        Â
Section
17.
55
        Â
Section
14.
56
        Â
Section
27(c) and (d).
57
        Â
Section
17(2).
58
        Â
Section
3(1).
59
        Â
Section
76(1)(b).
60
        Â
Section
26.
61
        Â
Chapter
5.
62
        Â
Section
27.
63
        Â
Section
89.
64
        Â
Sections
1(vii), 30(11) and 43.
65
        Â
Section
73(2).
66
        Â
Sections
14(1) and 17(2).
67
        Â
Section
29.
68
        Â
Section
29(4).
69
        Â
Section
30.
70
        Â
Section
30(5).
71
        Â
Section
1.
72
        Â
Section
43(a).
73
        Â
Section
43(b).
74
        Â
Section
43(c).
75
        Â
Note 26
above at para 469.
76
        Â
These are set out in
section 41, which reads:
“(1)All spheres of government and all organs of state within each
sphere must—
                                (a) preserve the
peace, national unity and the indivisibility of the
Republic;
                                (b) secure the
well-being of the people of the Republic;
                                (c) provide
effective, transparent, accountable and coherent government
for the Republic as
a whole;
                                (d) be loyal to the
Constitution, the Republic and its people;
(e) respect the constitutional status, institutions, powers and
functions of government in the other   spheres;
                                (f) not assume any
power or function except those conferred on them
in terms of the Constitution;
(g) exercise their powers and perform their functions in a manner
that does not encroach on the geographical, functional or institutional
integrity of government in another sphere; and
                                (h) co-operate with
one another in mutual trust and good faith by—
(i) fostering friendly relations;
(ii) assisting and supporting one another;
                                                (iii)
informing one another of, and consulting
one another on, matters of common
interest;
                                                (iv)
co-ordinating their actions and
legislation with one another;
                                                (v)
adhering to agreed procedures;
and
                                                (vi)
avoiding legal proceedings against
one another.
(2) An Act of Parliament must—
                (a) establish or provide for
structures and institutions to promote and facilitate intergovernmental Â
relations; and
b) provide for appropriate mechanisms and procedures
to facilitate settlement of intergovernmental disputes.
(3) An organ of state involved in an intergovernmental dispute must
make every reasonable effort to settle the dispute by means of
mechanisms and procedures
provided for that purpose, and must exhaust all other remedies before it
approaches a court to resolve
the dispute.
(4) If a court is not satisfied that the requirements of subsection
(3) have been met, it may refer a dispute back to the organs of
state involved.”
77
        Â
See the
judgment of Ngcobo J in
Executive Council of the Province of the Western
Cape v Minister for Provincial Affairs and Constitutional Development of the
Republic
of South Africa and Another
(as yet unreported) at paras 12 and
24-30.
78
        Â
Section
41(1)(f).  In the first
Certification Judgment
(above note 26) this
Court observed that the principles of cooperative government set out in section
41 “are largely of a general
kind which are sensible and might in any event be
inferred without these provisions”.
79
        Â
Section 43 reads in
full:
“In the Republic, the legislative authority—
                (a)
of the national sphere of government is vested in Parliament, as set out in
section 44;
(b) of the provincial sphere of government is vested in the
provincial legislatures, as set out in section 104; and
                (c) of the local sphere of government is vested in
the Municipal Councils, as set out in section 156.”
80
        Â
As this
Court pointed out in the first
Certification
Judgment
(above,
note 26 at para 256), the provinces also enjoy powers in respect of the adoption
of provincial constitutions making provision
for provincial legislative and
executive structures and procedures, and a traditional monarch; the summonsing
of persons to report
to or give evidence before the provincial legislature; the
imposition of provincial taxes;  the establishment, monitoring and promotion
of
the development of local authorities; and the spending power in respect of
money in the provincial revenue fund.
81
        Â
Instances
include various matters relating to the judiciary and the courts (Chapter 8),
state institutions supporting democracy (Chapter
9), public administration
(Chapter 10), national security (which in terms of section 198(d) “is subject
to the authority of Parliament
and the national executive”), certain financial
and revenue matters (Chapter 13), and the approval or tabling of international
agreements (section 231).Â
82
        Â
Section
146.
83
        Â
Section
147(1).
84
        Â
Above
note 26 at para 335.
85
        Â
Para 257.
86
        Â
Id.
87
        Â
See para
44 above.
88
        Â
Clarendon
Press, 1993.
89
        Â
The New
Shorter Oxford Dictionary includes among the meanings of “industry” : “Systematic
work or labour; habitual employment
in useful work. Now
esp.
work in
manufacturing and production; trade and manufacture collectively”; “[a]n
application of skill, cleverness, or craft”
and “[a] particular form or branch
of productive labour”.
90
        Â
1911 AD
214
at 229-230.
91
  Â
Section 15 of
the Wine and Spirit Control Act, 47 of 1970 regulates the production, sale and
disposal of wine. (The
Wine and Spirit Control Amendment Act, 25 of 1998
, which
commenced on 30 June 1999, provides for the lapse of the 1970 Act after a
'transitional period'.)  Section 20 of the Liquor
Act 27 of 1989 deals with the
kind of licences that may be granted for the sale of liquor.  These include
brewers' licences (section
20(b)(ii); sections 79-82); sorghum beer brewers’
licences (section 20 (b)(vi); sections 95-97); and producers' licences (section
20(b)(ix); sections 101-104).  Section 10 of the Liquor Products Act 60 of 1989
(read with section 27 (1), which grants certain
powers to the Minister
regarding the production of a liquor product), deals with “[a]uthorizations
regarding certain alcoholic
products”.  It provides that the Minister may grant
authority, by notice in the Gazette, to a person for the production and sale
of
alcoholic products.
92
        Â
P Craig and M Walters “The Courts,
Devolution and Judicial Review”
(1999)
Public Law
274
at 299.
93
        Â
See para
44 above.
94
        Â
[1996] ZACC 15
;
1996 (4) SA 653
(CC);
1996 (7) BCLR 903
(CC).
95
        Â
Referring to
Attorney-General for
Alberta v Attorney-General for Canada
[1939] AC 117
(PC) and
Ladore and
others v Bennett and Others
[1939] AC 468
(PC) at 482-3 ([1939]
3 All ER 98
at 105B-D).
96
        Â
At para 19.
97
        Â
Section
8(a).
98
        Â
Section
29.
99
        Â
Section
14.
100
       Â
Section
16.
101
       Â
Section
30.
102
       Â
See para
62 above.
103
       Â
Para 44
above.
104
       Â
Section
228(2)(a).
105
       Â
Section
2(b)(iv).
106
       Â
See para
44 above.
107
       Â
Section
49, read with section 27(a)(ii) and sub-sections 1(xx) and (xxviii) (permitting
the registration of “micro-manufacturers”
for the manufacture of liquor “that
does not exceed the prescribed volume”).
108
       Â
Section
50, read with subsections 1(xxxix) and 1(2)(c).
109
       Â
Section
49(1)(b) and section 50(1)(b).
110
       Â
Especially
section 14.