When the National Council of Provinces's (NCOP) ad hoc committee dealing with the Bill resumed its deliberations on Wednesday, the ruling party agreed to delete two bitterly contested clauses.
The first was the provision that the Bill would trump the Promotion of Access to Information Act (Paia).
This clause was strongly criticised by the Congress of South African Trade Unions, among others, as being unconstitutional.
The second concession was the removal of strict penalties for disclosing any state security matter.
The concern with this clause was that the country could be turned into a "security state".
In May the committee bent to pressure from interest groups and agreed to its own version of a public interest clause within the Bill.
According to that version, whistle-blowers who unlawfully and intentionally disclosed classified state information in contravention of the Act would be guilty of an offence and liable to a fine or imprisonment (for a period not exceeding five years), except where such disclosures reveal criminal activity, including criminal activity for ulterior purposes.
Political parties in Parliament have spent the past few weeks in private discussions in an effort to reach consensus on the Bill.
Wednesday's meeting of the ad hoc committee was the first since August 7, when committee chairperson Raseriti Tau adjourned proceedings, saying the process of party-to-party engagements would continue in an attempt to try and reach agreement.
"We're not that far apart and that's a good sign," he said at the time.
The committee has a deadline of September 30 to consider proposed amendments, before having to report on the Bill to the NCOP, which then submit the changes to the National Assembly.
The Bill has drawn international condemnation, with the the United States, Canada, Czech Republic, Germany, Norway, Poland, Portugal, Sweden and Switzerland expressing concerns the proposed law could be a major threat to media freedom.
The intervention was welcomed by activists who oppose the Protection of State Information Bill, which could make journalists and whistle-blowers vulnerable to prison sentences of up to 25 years.
South Africa's human rights record was scrutinised by a working group of the UN Human Rights Commission in Geneva. A draft report of the meeting shows Spain "asked about measures adopted to ensure that the future protection of state information does not curtail freedom of the press and the right to information on possible inappropriate action by public officials". – Additional reporting by Sapa, AFP