By Connie Jonker, The SAFEhouse Association
To protect consumers against unsafe products, regulatory processes were first introduced in South Africa during the 1980s and these processes became formalised by the publication of compulsory safety specifications for various products.
Implementation of these specifications was first driven by the SABS Regulatory Department, which was supported by extensive surveillance testing services provided by the various SABS test laboratories to verify the compliance status of products sampled from the open market.
In parallel to the compulsory processes, many manufacturers operated under a Type 5 – SABS Mark scheme, providing ‘proof of compliance’ of SABS mark bearing products, which accepted under the regulatory process, to ensure product safety to the consumer. Other non-mark bearing products, locally manufactured or imported, were regulated under a random sampling process from products available on the open market.
With the support of stakeholders and other manufacturers, who were able to pre-test suspect products utilising their in-house test facilities, the detection of unsafe products was reasonably effective, and responses to consumer complaints were treated by the SABS Regulatory Department as high priority and were speedily attended to. Non-compliance notices were issued to suppliers to limit sales of unsafe products and, if necessary, serious non-compliances were communicated to the consumer by the Regulatory Department, via press releases.
Verification testing of suspect products was often dealt with through SABS partial testing to focus on the specific deviation from specified requirements, enabling speedy confirmation in case of non-compliance.
‘Proof of compliance’ measures were later introduced, whereby a supplier/manufacturer was obliged to provide ‘proof of compliance’ in the form of a test report, if requested, by a regulatory inspector. This test report could be from in-house or 3rd party testing, but was aimed at making inspection more effective, and to place the responsibility onto the supplier to ensure better control over product safety. The effect was that many suppliers requested some partial or full pre-testing at 3rd party laboratories, including SABS, before placing products on the market.
Globalisation of trade and the implementation of WTO Technical Barriers to Trade Agreements had a significant impact on the South African technical infrastructure and, in addition to political changes in South Africa, transformation and re-structuring of public entities was on the cards.
SABS re-structuring and the NRCS act
Motivation for the re-structuring of the SABS to limit conflict of interest between standards development, product testing and regulation, led to the formation of the new NRCS structure, which was aimed at following International Best Practice. Development of compulsory specification was purported to be an open and transparent process, through active consultation with all stakeholders.
The new regulatory control model was based on pre-approval and issue of Letters of Authority (LOA) of regulated electrical products based on type testing by Accredited Test laboratories. Under the WTO TBT Agreement, many countries maintained their well-established product certification systems such as VDE, UL, KEMA, SGS and many others.
The new NRCS management, however, interpreted the existence of the SABS Mark scheme as being in conflict with the WTO TBT Agreement and immediately rejected the SABS Mark on regulated products as ‘proof of compliance’ with the new LOA process. In hindsight, it is clear that this interpretation was highly influenced by financial considerations to establish a broader income base, which would enable NRCS to also levy SABS Mark bearing products. Regulation of R999, which previously exempted SABS Mark products from levies, was rescinded and SABS permit holders were forced to make a choice between LOA + SABS Mark or LOA only. Many approaches to NRCS by industry members and industry associations to recognise SABS Product Certification have so far been unsuccessful.
International trends which were mainly based on 3rd party certification gradually made way for self-certification systems (SDOC) for products with lower safety risk, where the supplier takes full responsibility for product safety compliance, but are monitored by regulatory authorities. The standard for Suppliers Declaration of Conformity, SANS/ISO 17050:2014 which defines international practice for product regulation, was adopted as a South African National Standard, but its implementation has clearly not been considered by NRCS.
In the more than 40 countries, where SDOC has been introduced, severe penalties are applicable in the event false declaration and continued non-compliance of products.
The claims that NRCS follows International Best Practice is a misinterpretation and is based on the process of mutual recognition of Type Test reports under the IECEE CB Scheme, which does not apply to product certification. This is also confirmed by the statement made by the NRCS CEO during the 2019 Parliamentary Portfolio Committee meeting: “There was no comparable structure in the world, as NRCS was a single body doing all standards whereas other bodies dealt with only one standard.” He acknowledged that there was, however, room for improvement.
He explained that the NRCS had concluded a Memorandum of Understanding (MoU) with SABS. The model of the infrastructure of the entities was such that the mandate of the four entities overlapped. For example, he relied on SABS for testing capacity for compulsory specifications. If the SABS did not test, he would not be able to enforce compulsory specifications.
Incapacity, Manipulation and Consumer Choice
Due to escalation of the number of product types and models to be regulated under the LOA process, it has become clear that a central pre-approval process does not have the capacity and has resulted in extensive manipulation by many of the parties affected.
Applications for pre-approval covering extended product ranges are often based on type test reports applicable to prototype samples or even ‘golden samples’ specially prepared and selected for the type test. While test laboratories cannot establish the origin of the sample tested, the report only applies to the tested sample. It is a once-off test for all subsequent production. Subsequent quality control and regular verification, if implemented, becomes the responsibility of the supplier. Product coding and branding, and in some instances, grouping similar products from different manufacturers, are methods applied by unscrupulous suppliers to get access to the market.
The total lack of random surveillance sampling and testing aggravates the situation and opens the South African market to dumping without consequences to unscrupulous suppliers.
The incapacity and inability of NRCS to cover each type and model in the LOA process, has led to the introduction of variables in product codes, and not only makes product identification impossible, but also invalidates the type test report scope that now is applied to thousands of models on one LOA. The result is manipulation of processes leading to dubious LOAs that do not clearly define the product type and model.
The non-recognition of 3rd party certified products, which are manufactured under quality control processes, and the limited number of pre-approvals being conducted at unacceptable delays, is an indication of severe shortcomings within the NRCS’s pre-approval process, which makes it virtually impossible for suppliers and manufacturers to fully comply with the NRCS’s administrative and technical requirements.
Many suppliers are advised by LOA agents, who arrange LOA applications on behalf of suppliers, to have products tested, even against non-applicable specifications, to obtain a LOA to prevent inadvertent out-of-scope stoppages by NRCS appointed Border Management Agencies (BMA’s). Discussions with Accredited Test Laboratories have confirmed that importers often request test reports even if the products fall outside the scope of the compulsory specification.
A key element in any regulatory process, is feedback from consumers on product non-compliances and concerns, followed up by effective intervention by the regulatory authority through public disclosure of safety risk.
Feedback on various cases of pre-proven non-compliant products that were reported to NRCS is withheld as this information is regarded as confidential. Even high-risk cases are not attended to and in some instances LOA renewals are issued on reported non-compliant items.
Compliant product selection:
The NRCS inspectors and the consumer are now in many instances unable to distinguish between reliable and safe products or to determine the validity of the ‘proof of compliance’. With the virtual cancellation of 3rd party product certification, product selection can only be based on the integrity and reliability of the product brand or that of the supplier.
The schedule to the NRCS Act, Regulation R924 Section 10, specifies that in the development of compulsory specifications or amendments to a compulsory specification, an Impact Assessment must be conducted to determine the impact that the implementation of such a specification or amendment will have on all stakeholders. This aspect is also clearly reflected in the NRCS internal procedure CSP 350 for the development of specifications.
In addition to the Impact Assessment, the levy associated with the specification must be determined in consultation with stakeholders as part of the specification development process. The omission of these legally specified action has become a serious concern to stakeholders. In spite of various requests to discuss the impact of the LOA policy, any discussion has been denied by NRCS and ruled out of order.
The development of the draft specification for luminaires (VC9012), which was started during 2013, has been put on hold by Dti at industry’s request in a written confirmation dated 7 March 2018, that VC9012 will not be published pending an Impact Assessment to be conducted by NRCS. In spite of the Dti instruction to NRCS, the Impact Assessment for the regulation of luminaires, has not yet been conducted because “NRCS has not budgeted for a VC9012 Impact Assessment”. Financial support offered by industry associations towards the Impact Assessment was denied, as “this would not be allowed under the Public Finance Management Act (PFMA)”. Significant amendments to VC8055, and various other compulsory specifications have also not followed the Impact Assessment process.
The reluctance by NRCS to follow stipulations of the regulations can only be construed as being an attempt to prevent the public disclosure of the inefficacies of the regulatory process.
New MEPS project for Lighting Products
The introduction of a new project, Minimum Energy Performance Standards (MEPS) for lighting products, which is funded under the United Nations Development Program (UNDP), was recently subjected to a Socio-Economic Impact Assessment.
The Impact Assessment was conducted by an independent service provider, appointed under the UNDP, to evaluate the introduction of Minimum Energy Performance Standards (MEPS) for General Service Lamps. The Impact Assessment study highlighted many of the regulatory key shortcomings.
An extract from the Impact Assessment study shows the following:
- The enforcement agencies (NRCS) have insufficient resources to introduce and enforce the proposed MEPS regulation;
- To date these agencies have undertaken very limited market surveillance;
- Reports of non-compliance submitted to the relevant authorities have not been investigated;
- Border control is weak;
- There are no consequences, such as severe penalties that can be legally applied to non-compliant suppliers;
- There is insufficient capacity to test products for compliance with the present and proposed new regulations.
The above issues, which equally apply across the entire regulatory product scope, have been under discussion with NRCS by stakeholders and industry associations from many industry sectors and in many forums since the formation of the NRCS in 2008 and are again confirmed by the independent international consulting group. Needless to say, all previous discussions have not been heeded and the irrational and ineffective NRCS policy of ‘One Test Report – One LOA’ has never been reviewed in consultation with stakeholders.
Requests from industry to improve market surveillance, monitoring, verification and evaluation (MVE), followed up by transparent regulatory action, have, to date, been ignored.
The MEPS Consultants finally make recommendations: “These include:
- The streamlining and automation of the pre-certification process;
- Improving the human resource capacity of control officers to increase their effectiveness – including communication and awareness;
- Setting a clear strategy for compliance monitoring – with specific goals and targets and timely transparent reporting on results; and
- Consider whether it is feasible to introduce self-declaration for certain categories of products, where risks associated with non-compliance are relatively low.
Exclusion of industry representation
The NRCS Act defines the structure of NRCS to be under supervision of the NRCS Board, and supported by an Advisory Forum as follows:
- (1) The Board must establish am Advisory Forum with a balance of interests consisting of representatives of organisations who have an interest in the matters contemplated in the Act.
(2) The Advisory Forum must advise the Board on:
(a) matters in respect of which the National Regulator could play a role; and
(b) any other matter on which the Board requests advice.
(3) The Board must establish a constitution and, if necessary, rules for the Advisory Forum.
The 2019 Parliamentary Portfolio Committee for Trade and Industry report reflects that the NRCS Board was disbanded following an amendment of the NRCS Act (Act 5 of 2008), through the Legal Metrology Act (Act 9 of 2014) dated 19 May 2014, due to alleged corruption by the NRCS Board. NRCS reports directly to the Minister of Trade and Industry since 2014.
The formation of other oversight structures such as an Advisory Forum, where representatives of organisations who have an interest in matters contemplated in the NRCS Act, and Specialist Consultative Committees that could deal with matters of concern and which could fulfil an ‘Ombudsman’ function, have never materialised, although many requests from industry associations were made to that effect. These structure deficiencies directly affect the openness and transparency of the regulatory processes and hamper reviews.
Many matters such as out of scope stoppages, unjustified regulation of products that do not pose a safety risk and irregular interpretations of regulatory requirements that could be resolved through consultation or arbitration, are not being resolved.
It is quite clear that the impacts to consumers and suppliers of regulated products and to the South African Economy at large, have become unbearable. The NRCS regulatory processes and its funding model are in dire need of an extensive review to reflect international best practice and to minimise conflict of interest and to align with the NRCS Mandate of protection to the environment and the public, while ensuring fair trading.
Regulatory changes can only be achieved through continued active liaison and cooperation between industry, the NRCS and Dti. Are you as industry member or industry association prepared to take up the challenge, or are you accepting the existing norm?