Concerns are mounting that the Companies and Intellectual Property Registration Office (Cipro) will not be ready when the new Companies Act comes into effect next year, as a court case holds up implementation of a vital IT overhaul.
The court battle, between Valor IT and the Department of Trade and Industry (DTI), over a canned R153 million contract, is now set to be heard next year. Even then, the matter is unlikely to be heard before February, at the earliest.
Valor IT chairman Josias Molele says the date for the company's application to have the electronic content management (ECM) system contract declared valid has been pushed out to next year. He says it is likely the matter will only be heard after February.
Valor IT's contract was canned earlier this year by trade and industry minister Rob Davies after a forensic report, which was completed in March, revealed tender irregularities in the awarding of the deal.
The forensic report also resulted in Cipro's CEO Keith Sendwe and CIO Michael Twum-Dwarko being suspended. In May, Davies announced the pair would be charged, but Sendwe has since died and Twum-Dwarko is still waiting for a hearing date to be set.
No quick-fix
The ECM system is vital for Cipro to be able to cope with new requirements outlined in the upgraded Companies Act. The legislation was meant to come into effect in October, but has now been delayed to April, to “enable the department to finalise all processes required to effectively administer these two pieces of legislation”, the DTI said in a statement last month.
However, the new Act also requires Cipro, in its new guise, to implement a range of electronic functions, with which its current legacy systems cannot cope.
The office is upgrading its existing IT systems to cut down on fraud, but acting CEO Lungile Dukwana previously conceded that “the current system is not helping us... this is an old legacy system”.
Molele says without the ECM system, the commission cannot come into being, and the IT overhaul will not happen until the matter has been heard in court. “Cipro can't fix the problems it has on its present systems,” he notes.
Molele says he is waiting for his day in court to clear his name, and that the DTI's allegations that the tender process was flawed are incorrect. “They blindly walked into this matter without having checked their allegations.”
No clarity
Jacques Smalle, the Democratic Alliance's shadow deputy minister of trade and industry, is concerned about Cipro's credibility as it has been plagued by several instances of fraud perpetrated on its database.
Smalle says the office is unlikely to be ready in time for the new Act, because it cannot move ahead with implementation of the system until the court case is resolved.
He is concerned about the delays in getting the matter sorted out, and will push Davies to reveal the forensic report, which has yet to be made public. In addition, says Smalle, he wants Davies to explain what is going on with the court matter.
Sidwell Medupe, director of media and public relations, would not clarify what the status of the ECM system is, saying the DTI cannot comment on either the court case, nor the IT overhaul because the issues are “linked”.
“As a department, we ensure the IT system is running so that customers don't suffer,” says Medupe. He would not clarify which system this is, nor would he “pre-empt” whether the office will be ready by April.
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