NEWS ANALYSIS: Foreign-owned security firms bide time while bill is redrafted
WHEN a ban on foreign ownership of private security companies in South Africa was first mooted back in 2001, the reasons for such a move were unclear, but a subsequent agreement with the companies involved over support of black economic empowerment gave a few clues.Speculation at the time was that part of the motivation for the proposed ban was a desire to keep control of a flourishing industry estimated at the time to be worth about R4bn.Now the industry has grown to an estimated R50bn and the government is again intent on limiting foreign ownership of private security companies to 49% through amendments to the Private Security Industry Regulation Act brought by Police Minister Nathi Mthethwa. These amendments would require foreign owned companies to sell 51% of their shares to South Africans over a five year period. The rationale this time is that the 1.7-million employees in the private security industry pose a risk to national security, but no evidence of this has yet been provi...
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