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Procedure for Implementing Mergers

The concept of mergers and acquisitions were only introduced by the new Companies Act No. 71 of 2008 (“Companies Act”). Simply put, a merger and acquisition occurs when two or more profit companies combine their assets and liabilities into a new company or into one of the existing companies. While the requirements for entering into [...]

VDMA Visit Milano, Italy

VDMA’s managing partner, Pieter van der Merwe, was recently approached by the legal bar association of Milan, Italy to participate in the “Cross border deals in Africa legal considerations and business opportunities on South Africa” event to be held at the Palace of Justice in Milan, Italy on 03 November 2016. Pieter van der Merwe [...]

Risky Business

‘Risk management’ is a term that has been receiving a lot of attention since the 2007 financial crisis. The financial crisis was a massive failure which took all by storm, apart from the unpopular few who predicted it. Along with corporate governance and unscrupulous auditing, risk management has been identified as one of the biggest [...]

Sectional Title Schemes and Management and Conduct Rules

Sectional title schemes are becoming increasingly popular in South Africa whether as a primary residence or as an investment opportunity. They afford owners the opportunity to purchase and own a unit within the scheme and an undivided share in the common property thereof. Section 35(4) of the Sectional Titles Act No. 95 of 1986 (“STA”) [...]

Protection of Employees during an Acquisition

The protection of employees and employees’ rights is a fundamental aspect of labour law in South Africa. South Africa, partly as a result of its history of past human rights abuses, is specifically aware of the rights of employees in relation to the employment relationship with employers. The abundance of ready labour in South Africa, [...]

Delinquency of Directors

Directors of a company exercise a large amount of control over the company’s business affairs. The position of a director is legislatively controlled by the Companies Act No. 71 of 2008 (“Act”) and in particular, section 76 of the Act provides for the standards of conduct expected from directors, namely that directors must act in [...]

The Impact of the Companies Act on Close Corporations

A close corporation (“CC”) is a company with juristic personality where a select few individuals usually perform all of the functions of the corporation and allow it to operate in a similar vein to that of a partnership. The Close Corporations Act No. 69 of 1984 (“CC Act”) created simple and clear regulations to govern [...]

Broad-Based Black Economic Empowerment

After the 1994 democratic elections the South African government was mandated with the task of redressing the inequalities of the past. With that in mind various legislative initiatives have been implemented in an attempt to redress the imbalances inherent in the economy. One such initiative is Broad-Based Black Economic Empowerment (“BEE”). The BEE framework is [...]

Corporate Opportunities and a Directors Fiduciary Duty

It is a well-established rule of Company Law that directors have a fiduciary duty to exercise their powers in good faith and in the best interests of the Company.  They may not make a secret profit or otherwise place themselves in a position where their fiduciary duties conflict with their personal interests (Robinson v Randfontein [...]

Public Benefit Organisations

A public benefit organisation (“PBO”) is an entity which is created to carry on some form of public benefit activity (“PBA”). Due to the fact that a PBO acts in the public interest, it enjoys certain tax benefits. These benefits include not paying income tax, donations tax and if the PBO has section 18A approval [...]

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