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SERVICE LEVEL AGREEMENT

Service Level Agreement

SERVICE LEVEL AGREEMENT | Document Parties: THE LIMPOPO PROVINCIAL GOVERNMENT You are currently viewing:
This Service Level Agreement involves

THE LIMPOPO PROVINCIAL GOVERNMENT

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Title: SERVICE LEVEL AGREEMENT
Date: 2/3/2004

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Exhibit 10.3

SERVICE LEVEL AGREEMENT

BETWEEN

THE LIMPOPO PROVINCIAL GOVERNMENT

IN ITS

DEPARTMENT OF HEALTH AND WELFARE

AND

CASH PAYMASTER SERVICES

(Northern) (Pty) Ltd


SERVICE LEVEL AGREEMENT

 

BETWEEN

 

THE LIMPOPO PROVINCIAL GOVERNMENT IN ITS

DEPARTMENT OF HEALTH AND WELFARE

Represented by DR. HLAMALANI NELLY MANZINI in her capacity as Head of Department of Health and Welfare (Hereinafter referred to as “the Department”) and duly authorised

and

CASH PAYMASTER SERVICES (Northern) (Pty) Ltd
Represented by Solomon Poroma Mohale in his capacity as director (hereinafter referred to as “the CONTRACTOR”) duly authorised thereto by a Directors’ resolution, copy attached hereto marked Annexure A, in respect of disbursement of social pensions and social grants.

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1.  

PREAMBLE

 

 

Whereas the Department has sought an alternative, more efficient and cost effective means to administer and operate all activities included in the automated cash payments of pensions and grants.

 

 

 

 

1.1

The Provincial Tender Board has approved tender no NTP8342 to the CONTRACTOR and has authorised the Department to enter into a service level agreement with the CONTRACTOR prior to the commencement of any activities under this contract, the Effective date;

 

 

1.2

The CONTRACTOR agrees to render cash payment services to the beneficiaries of pensions and grants on behalf of the Department.

 

 

1.3

Payments of pensions and grants currently made by the South African Post Office and Banks are excluded.

 

 

1.4

The number of beneficiaries expected to be serviced is estimated at 514 000 as at the time of preparation of the tender specification, allocated to 1 900 Pay points. These quantities shall in no way be construed by the CONTRACTOR as being guaranteed minimums or maximums by the Department.

 

 

THEREFORE the parties wish to record in writing their agreement relating the aforementioned and matters incidental thereto.

 

 

2.  

INTERPRETATION AND DEFINITIONS

 

 

In this agreement and in the annexures hereto.

 

 

2.1

clause headings are for convenience and are not to be used in their interpretation;

 

 

2.2

unless the context indicates a contrary intention, but not limited to, an expression which denotes;

 

 

 

2.2.1

any gender includes the other gender;

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2.2.2

a natural person includes a juristic person and vice versa;

 

 

 

 

2.2.3

the singular includes the plural and vice versa;

 

account”

means interest bearing smart card based account which does not require the maintenance of any minimum balance therein and free of any bank charges or costs, opened by the CONTRACTOR in the name of each grant beneficiary.

 

 

“AFIS”

means Automated Fingerprint Identification system.

 

 

“Act”

means Social Assistance Act 1992 (Act 59 of 1992) as amended.

 

 

“Biometric identification”

means the identification of a person by using Automated Fingerprint Identification (AFIS) computer technology to identify each beneficiary.

 

 

“Biometric verification”

means the verification of each beneficiary at the Pay points by using computer technology to verify the relationship between a beneficiary and his / her fingerprints already captured previously during bulk enrolment.

 

 

“Biometric Identification and Verification Software and Procedures”

 

 

 

means the procedures that are used to verify that a beneficiary’s or procurator’s fingerprints match those that have been stored on the smart card issued to the beneficiary or his/her procurator during bulk or on-going registration and the software developed by the CONTRACTOR that allows

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verification to take place, namely, the reading of a fingerprint template from the smart card, the forwarding of this template to the fingerprint reader selected by the CONTRACTOR and the response from the reader, which indicates the acceptance or the rejection of the template submitted. Proprietary matching algorithms that belong to the manufacturer of the selected reader and any other non-related software are excluded.

 

 

 

 

“Bulk enrolment,
register or registration”

 

 

means the process to capture fingerprints of four fingers, two from each hand, of each beneficiary and/or his/her procurator in the Province using the AFIS computer technology (these fingerprints will be used for Biometric verification of each beneficiary).

 

 

 

 

 

“Business day”

Means any day other than Saturday or Sunday or Official public holiday;

 

 

 

 

Completion date

The date on which this contract shall be completed being the 30 November 2006 or any later date, due to possible extensions, which may be agreed to by both parties.

 

 

 

 

“District and sub-district”

Means the pension district more fully described in Annexure “B” hereto:

 

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“District officer”

Means a person appointed by the department as a district pension officer for a particular district and / or as district allowance officer for a particular district;

 

 

“Effective date”

The date on which the CONTRACTOR shall commence payment of grants or pensions to the beneficiaries or their designated procurators being 1 December 2003.

 

 

Contract date

The date on which this contract is signed, being a maximum of 45 days from the date the tender was awarded (28 November 2002) or later 25 may be agreed to by both parties.

 

 

“Procurator”

means a person who is entitled to withdraw social grant on behalf of a beneficiary. Both the Department and the CONTRACTOR should dul register this person as provided for in clause 32.

 

 

“Province”

Means the Provincial Government of Limpopo.

 

 

“Identity Number”

Means 13 (thirteen) digit, bar coded cumber for personal identification issued by the Department of Home Affairs.

 

 

“Legislature”

Means the Legislature of the Limpopo Provincial Government, its successors or assignees.

 

 

“Parties”

Means the CONTRACTOR and the DEPARTMENT.

 

 

“Pay Days”

Means those days agreed upon between the Parties on which the withdrawal grants or allowances shall be made by the beneficiaries at the Pay points;

 

 

“Pay points”

Means the designated places for the payment of grants and

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allowances by the CONTRACTOR as set out in ANNEXURE C.

 

 

“Pay Times”

Means the times between 08h00 and 15h00 agreed upon between the PARTIES during which beneficiaries and/or procurators who have been identified by the DEPARTMENT in accordance with the provisions of this agreement and registered by the CONTRACTOR in accordance with the provisions of this agreement will be paid.

 

 

“Service Level Reports”

Means service level reports as set out in a separate document required from both PARTIES which are regarded as a management tool and framework on which to base, evaluate and assess the performance criteria in each of the functional areas of the social grants payment service as specified in the contract as per Clause 33.

 

 

“agreement” and
”this agreement”

 

means this agreement and the tender documents;

 

 

“contract manager”

means a designated employee of each party, whose responsibility is to ensure that each party complies with its contractual obligations in terms of this agreement and who is responsible to develop the service level reports and act as a communication channel between parties.

 

 

“confidential information”

means all confidential data whether of a historical, current or future nature irrespective of whether it is stored, recorded or

7


 

 

embodied in a hand written, printed, visual, electronic, audible or other format or medium, and belonging to, created by, in the possession or under the control of the parties individually. For the purpose of this agreement, “information” shall include, without limiting its ordinary meaning, data, codes, letters, telefaxes, telegrams, faxes, agreements, specifications and strategic plans;

 

 

“disclose”

means the direct or indirect use, dissemination, publication, transference or transmission of confidential, in any manner or form whatsoever, and “disclosure” has a corresponding meaning;

 

 

“month”

means a period of one month according to the Gregorian calendar commencing with first day of that month;

 

 

“prime rate”

means the basic annual rate of interest quoted and levied from time to time by bankers as appointed by the Department from time to time on the unsecured overdrawn current accounts or its most favoured corporate customers in the private sector, as certified by a certificate issued by any director or manager of that bank (whose authority or appointment or qualification it shall not be necessary to prove) calculated on the daily balance and capitalised monthly in arrears, such certificate constituting prima facie proof of such rate in the event of a dispute;

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“services”

means the services the CONTRACTOR shall provide to the Department in terms of the tender documents, and shall include but not limited to bulk enrolment, ongoing enrolment, issuing of smart cards, replacement of lost cards, security at Pay points and payment of grants.

 

 

“SOCPEN payment file”

means the electronic data file provided by the State Information Technology Agency, which contains the details of all beneficiaries to be paid during a payment cycle.

 

 

“steering committee”

means a committee referred to in clause [8.2]

 

 

“tender”

means tender number NPT8342, approved by the tender board of the Limpopo Provincial Government.

 

 

“tender documents”

Means tender number NPT8342, the specifications (Annexure D), NPT1 and NPT2, the CONTRACTOR’s response to the tender and the tender board’s letter of acceptance of the CONTRACTOR’s offer. In the event that a conflict occurs between the above mentioned documents the tender board’s letter of the acceptance of the CONTRACTOR’s offer shall have precedence over the CONTRACTOR’s response which shall have precedence over the tender specifications NPT 8342.

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2.3

if any provision in a definition is a substantive provision conferring rights or imposing obligations on any party, notwithstanding that it is only in definition clause, effect shall be given to it as if it were a substantive provision in the body of this agreement;

 

 

2.4

when any number of days is prescribed in this agreement, they shall be reckoned exclusively of the first and inclusively of the last day unless the last day falls on a Saturday, Sunday or public holiday, in which case the last day shall be the next succeeding day which is not a Saturday, Sunday or public holiday; where figures are referred to in numerals and in words, if there is any conflict between the two, the words shall prevail; expressions defined in this agreement shall bear the same meanings in schedules and Appendices or Annexures to this agreement which do not themselves contain their own definitions;

 

 

2.5

all schedules, appendices and Annexures to this agreement shall be deemed to have been expressly incorporated into and form anintegral part of this agreement and as such each reference herein to this agreement shall be deemed to include a reference to all such Schedules, Appendices and Annexures:

 

 

2.6

where any term is defined within the context of any particular clause in this agreement, the term so defined, unless it is clear from the clause in question that the term so defined has limited application to the relevant clause, shall bear the meaning ascribed to it for all purposes in terms of this agreement, notwithstanding that term has not been defined in this interpretation and definitions clause;

 

 

2.7

a reference to a party includes that party’s successors in title and permitted assigns;

 

 

2.8

any reference to an enactment is to that enactment, as amended, as of the date of signature thereof, and as amended or re-enacted from time to time;

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2.9

the expiration or termination of this agreement shall not affect such of the provisions of this agreement as expressly provided that they will operate after any such expiration or termination or which of necessity must continue to have effect after such expiration or termination, notwithstanding that the clauses themselves do not expressly provide for this; Provided that if either it be expressly so provided without agreement as to the termination of such a continuation or if there be no provision allowing for a continuation, a provision that continues to operate by virtue of this clause shall cease to do so after a reasonable time;

 

 

2.10

the rule of construction that the contract be interpreted against the party responsible for the drafting or preparation of the agreement shall not apply.

 

 

3.  

APPOINTMENT OF THE CONTRACTOR.

 

 

3.1

In accordance with the award of the tender to the CONTRACTOR, the Department hereby appoints the CONTRACTOR, which hereby accepts the appointment to provide the services in accordance with the terms of this agreement.

 

 

3.2

Notwithstanding the date of signature of this agreement, all rights and obligations arising from this agreement shall be deemed to have come into operation on the Effective date.

 

 

3.3

Neither the appointment of the CONTRACTOR in Clause 3.1 nor anything in this agreement shall give rise to or be construed as giving rise to an employer- employee relationship between the parties nor that of principal and agent, nor shall it give rise to a joint venture nor an agreement of partnership between the parties, nor shall it give rise to a labour broking agreement.

 

 

3.4

Notwithstanding anything to the contrary contained herein, the parties acknowledge that neither of the parties has any authority whatsoever to represent or to bind the other in any capacity whatsoever. In particular, but without limiting the generality of the aforegoing,

11


 

 

neither of the parties shall be entitled to conclude any contract or sign any document on behalf of the other party or in any way bind the other party’s performance, variation, release or discharge of any obligation.

 

 

3.5

Neither of parties shall acquire any rights, title or interest of any kind in any brand name or trademark of the other party or any of the other’s subsidiaries. All the parties hereby acknowledge such rights, title or interest to be the sole and exclusive property of the other or such subsidiary as the case may be (“the owning party”). If called upon to do so by the owning party, the party or parties called upon shall sign a user agreement in respect of any such brand name or trademark.

 

 

3.6

The CONTRACTOR shall pay a beneficiary in full, the monies due to him/her, as per the SOCPEN payment file, without making any deductions whatsoever.

 

 

4.  

EXCLUSIVITY

 

 

4.1

The CONTRACTOR shall be entitled to and shall provide the services to the Department as per this agreement.

 

 

4.2

The Department shall be entitled to demand from the CONTRACTOR to deliver services as per this agreement.

 

 

5.  

THE SERVICES

 

 

The CONTRACTOR shall, in return for fees charged, render to the Department the services, from the Effective date in accordance with the provisions of this agreement.

 

 

6.  

AMENDING THE SCOPE OF SERVICES

 

 

6.1

Amendments by the parties to this contract to the scope of the services shall be made subject to the Tender Board’s approval and in accordance with the following procedure;

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6.1.1

either party may propose to the other party in writing that the scope of the services should be amended and shall describe the nature of the proposed amendment;

 

 

 

 

6.1.2

the proposal shall be accompanied by reasons explaining the need for the amendment;

 

 

 

 

6.1.3

the other party may within 30 working days request an amplification of the reasons provided in accordance with clause 6.1.2;

 

 

 

 

6.1.4

the parties shall consult in good faith regarding the nature, scope and implementation of the amendment;

 

 

 

7.  

INCORPORATION OF TENDER DOCUMENTS

 

 

7.1

It is recorded that this agreement supplements the tender documents whose provisions shall be incorporated into this agreement as if expressly set out herein.

 

 

7.2

In the event that there is a conflict between the terms of this agreement and the tender documents, the tender documents shall receive precedence subject to changes if any agreed by both parties and ratified by the Tender Board.

 

 

8.  

CONTRACT MANAGEMENT

 

 

8.1

Contract Managers

 

 

 

8.1.1

The parties shall each appoint a contract manager whose responsibility shall be to ensure that the responsibilities of the party appointing such manager outlined in this agreement are carried out. The manager for the Department shall be the general manager responsible for social security in the Department and the manager for the CONTRACTOR shall be the provincial manager appointed by the CONTRACTOR’s board of directors.

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8.1.2

The two contract managers shall communicate on an ongoing basis, but at least monthly, to discuss the provision of the services and any issues that may arise.

 

 

 

 

8.1.3

The contractor shall maintain minutes of the meetings of the contract managers and shall send copies to the Steering Committee.

 

 

 

 

8.1.4

The Contract managers shall be responsible for monitoring the provision of services in accordance with the service level reports and for the general management of this agreement.

 

 

 

8.2

The parties agree to establish a Steering Committee that shall be responsible for the evaluation of performance of the parties’ obligations in terms of this agreement. The Steering Committee shall meet on a quarterly basis or as agreed upon by both parties and shall comprise of:

 

 

 

 

8.2.1

The Senior General Manager responsible for Welfare (chairperson).

 

 

 

 

8.2.2

The Chief Financial Officer of the Department:

 

 

 

 

8.2.3

The General Manager (Contract Manager for the Department) responsible for social security;

 

 

 

 

8.2.4

The Senior Manager responsible for Provisioning and Contract Management of the Department;

 

 

 

 

8.2.5

The Senior manager responsible for social security;

 

 

 

 

8.2.6

The Contract Manager for the CONTRACTOR and not more than three representatives.

 

 

8.3

The Steering Committee shall meet at least quarterly to evaluate performance of services in terms of this agreement and any other related issues.

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8.4

The management committee shall meet on a monthly basis or as agreed upon by both parties and shall consist of:

 

 

 

 

8.4.1

The General Manager Social Security (Chairperson);

 

 

 

 

8.4.2

Two Senior Managers Social Security;

 

 

 

 

8.4.3

Managers in the Social Security;

 

 

 

 

8.4.4

District Managers;

 

 

 

 

8.4.5

CONTRACTOR’s Branch Managers;

 

 

 

 

8.4.6

Two Contract Managers;

 

 

 

 

8.4.7

CONTRACTOR’s Provincial Manager.

 

 

 

8.5

District committees shall meet on a monthly basis or as agreed upon by both parties and shall comprise of:

 

 

 

 

8.5.1

CONTRACTOR’s Branch Managers

 

 

 

 

8.5.2

District Managers (Chair)

 

 

9.  

DURATION, TERMINATION AND BREACH

 

 

9.1

This agreement shall endure for a period of three years calculated from the effective date, unless terminated in accordance with the provisions of this agreement, with the option for the Department to extend it if necessary for one (1) more year at a time.

 

 

9.2

The CONTRACTOR acknowledges that it is bound by the provisions of paragraph 45 (failure to comply with conditions and delayed execution), paragraph 46 (remedies in the case of bribes) and paragraph 48 (remedies in case of liquidation and procedures in the event of unsatisfactory performance) of Northern Province Tender Board General Conditions and Procedures (NPT1).

 

 

9.3

Should either party commit a material breach of any of the provisions of this agreement, then the aggrieved party shall be obliged to give the other party 30 (thirty) working days

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written notice to remedy the breach. If the guilty party fails to comply with such notice, or where the breach cannot be remedied within 30 (thirty) working days, fails within such period to initiate such steps towards remedying such breach as shall be reasonable in the circumstances and fails to proceed to remedy such breach, or is incapable of being remedied, then and only in such events the aggrieved party shall be entitled to:

 

 

 

 

9.3.1

Cancel this agreement or

 

 

 

 

9.3.2

Claim specific performance from the other party of all its outstanding obligations, in either instance and without prejudice to such other rights as the aggrieved party may have in law arising out of such breach, such party shall not cancel this agreement unless the breach is a material breach going to the essence of this agreement and is incapable of being remedied.

 

 

 

10.

WARRANTIES

 

 

10.1

The CONTRACTOR hereby represents and warrants to the Department that:

 

 

 

 

10.1.1

it has full power and authority to enter into, legally bind itself by and perform its rights and obligations under this agreement;

 

 

 

 

10.1.2

This agreement has been duly authorised and executed by it and constitutes a legal, valid and binding set of rights and obligations on it; and

 

 

 

 

10.1.3

The execution and performance of this agreement does not constitute a violation of any statute, judgement, order, decree or regulation or rule of any court, competent authority ir arbitrator of competent jurisdiction applicable or relating to it, its assets or its business, or its memorandum, articles of association or any other documents or any binding obligation, contract or agreement to which it is a party or by which it or its assets are bound.

 

 

10.2

The Department hereby represents and warrants to CONTRACTOR that:

16


 

 

10.2.1

it has full power and authority to enter into, legally bind itself by and perform its rights and obligations under this agreement;

 

 

 

 

10.2.2

this agreement has been duly authorised and executed by the Department;

 

 

 

 

10.2.3

the execution of this agreement does not violate any judgement or order of any court, competent authority or arbitrator of competent jurisdiction applicable in relation to the Department or the existing assets of the Department;

 

 

 

 

10.2.4

It has the legal capacity and authority to appoint the CONTRACTOR as a service provider on the basis set out in this agreement.

 

 

 

10.3

It is expressly agreed between the parties that each warranty and each representation given by both of them in this agreement are material to this agreement and have induced them to conclude this agreement.

 

 

10.4

No warranties or representations which are not set fort in this agreement shall be binding on either party.

 

 

10.5

CONTRACTOR guarantee:

 

 

 

 

10.5.1

The CONTRACTOR guarantees that it can deliver the services according to the terms and conditions as stipulated in the tender documents.

 

 

 

 

10.5.2

The CONTRACTOR shall provide backup to ensure performance in all respects as per the tender documents.

 

 

 

 

10.5.3

The CONTRACTOR shall ensure data integrity, accessibility and systems continuity by making appropriate backups and depositing, the Biometric Identification and Verification Software and Procedures with Escrow as per clause 35.1

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10.6

Provisions of clauses 10.1 to 10.5 shall survive the termination of this agreement but shall not survive the Completion date.

 

 

 

11.

BEST ENDEAVOURS AT DISPUTE RESOLUTION

 

 

11.1

Both parties agree that it is in their best interest to resolve any matters of disagreement before resorting to legal remedies.

 

 

11.2

The parties agree that the two contract managers shall attempt to resolve all issues involved in the administration of this agreement. If the two contract managers are unable to reach a resolution within seven working days, the signatories of this agreement shall attempt to reach an acceptable resolution.

 

 

11.3

In the event that the signatories to this agreement reach an impasse after 14 working days of referral of the dispute, the aggrieved party will notify the other party in writing within seven days of the nature and cause of the dispute.

 

 

11.4

The party notified of the dispute shall have 21 working days to rectify the cause.

 

 

11.5

If party notified of a dispute fails to rectify the cause of the dispute, the aggrieved party may refer the dispute to arbitration.

 

 

12.

ARBITRATION

 

 

12.1

A dispute which arises in regard to-

 

 

 

 

12.1.1

the interpretation of;

 

 

 

 

12.1.2

the carrying into effect of;

 

 

 

 

12.1.3

either of the party’s rights and obligations arising from:

 

 

 

 

12.1.4

the termination or purported termination of or arising from the termination of; or

 

 

 

 

12.1.5

the rectification or proposed rectification of this agreement, or out of or pursuant to this agreement, or on any matter which in terms of this agreement requires agreement by the parties (other than where an interdict is sought or urgent relief

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may be obtained from a court of competent jurisdiction) shall be submitted to and decided by arbitration, provided that it has first been negotiated in terms of clause 11 above, and is not subject to any process or remedy in this agreement that is not compatible with arbitration.

 

 

 

12.2

The arbitration shall be held at Polokwane.

 

 

 

 

12.2.1

with only the legal and other representatives of the parties to the dispute present thereat; mutatis mutandis in accordance with the provisions of the Supreme Court Act 59 of 1959, the rules made in terms of that Act and the practice of the High Court of South Africa and in terms of the Arbitration Act, No. 42 of 1965, it being the intention that the arbitration shall be held and completed as soon as possible.

 

 

 

12.3

The arbitrator shall be, if the matter in dispute is principally-

 

 

 

 

12.3.1

a legal matter, a practising advocate or attorney of at least 10 (ten) years’ standing;

 

 

 

 

12.3.2

an accounting matter, a practising chartered accountant of at least 10 (ten) years’ standing;

 

 

 

 

12.3.3

any other matter, any independent person, agreed upon between the parties.

 

 

12.4

Should the parties to the dispute fail to agree whether the dispute is principally a legal, accounting or other matter, the matter shall be deemed to be a legal matter.

 

 

12.5

Should the parties fail to agree on an arbitrator within 3 (three) working days of a request by either party, the arbitrator shall be appointed at the request of either party to the dispute by the President for the time being of the law Society of the Northern Provinces (or its successor).

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12.6

The decision of the arbitrator shall be final and binding on the parties to the dispute and may be made an order of the court at the instance of either of the parties to the dispute.

 

 

 

12.7

The decision of the arbitrator shall be recorded in writing.

 

 

12.8

This clause shall not preclude either party from obtaining interim relief from the High Court of South Africa pending the resolution of the deadlock or dispute by the parties.

 

 

12.9

The provisions of this clause:

 

 

 

12.9.1

constitute an irrevocable consent by the parties to any proceedings in terms hereof and no party shall be entitled to withdraw there from or claim at any such proceedings that it is not bound by such provisions; and

 

 

 

 

12.9.2

are severable from the rest of this agreement and shall remain in effect despite the termination of or invalidity of any provision of this agreement.

 

 

 

13.

BULK ENROLMENT

 

 

 

13.1

Standards

 

 

 

 

13.1.1

The CONTRACTOR’s system shall cater for the registration of all beneficiaries and procurators as defined by the SOCPEN file receiving payment in cash (excluding beneficiaries receiving payment at banks and post offices).

 

 

 

 

13.1.2

The CONTRACTOR shall register beneficiaries from computerised lists supplied by the DEPARTMENT through the SOCPEN file. The DEPARTMENT shall have final approval rights on all beneficiaries so registered.

 

 

 

 

13.1.3

The CONTRACTOR shall perform enrolment of biometric and other data for the beneficiaries, including photographs and fingerprints (four fingers, two from each hand, for each beneficiary) in accordance with clause 13.2.

 

 

 

 

13.1.4

The CONTRACTOR shall perform live scanning of four fingers, two from each hand. Image files must comply with an acceptable international format.

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13.1.5

The CONTRACTOR shall utilise enrolment workstations at all Pay points during bulk registration.

 

 

 

 

13.1.6

Ownership of the bulk registration equipment and systems remains with the CONTRACTOR.

 

 

 

 

13.1.7

The CONTRACTOR shall not use fingerprint or other data belonging to the Depa


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