Delinquent Directors

The Companies Act No. 71 of 2008 (“Act”) protects the interests of parties who have a vested interest in a company against the mismanagement thereof by regulating the conduct of a company and those acting on behalf of it. Directors, due to the influence they have over a company, are required to act with a [...]

CAN THE PROMOTION OF ACCESS TO INFORMATION ACT, NO. 2 OF 2000 BE USED TO CIRCUMVENT THE LIMITATIONS SET OUT IN SECTION 26 OF THE COMPANIES ACT, NO. 71 OF 2008?

The Promotion of Access to Information Act, No. 2 of 2000 (“PAIA”) gives effect to section 32 of the Constitution of the Republic of South Africa, 1996 (“Constitution”). More specifically, PAIA provides for the enforceability of “the right of access to information” and “the right of access to any information held by the State and [...]

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 [...]

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 [...]

The Corporate Opportunity Rule

In sharp contrast to the non-profit rule is the common law corporate opportunity doctrine which finds its application in South African company law in instances where a director misappropriates and exploits for himself, an economic opportunity of the company. Such an opportunity is said to be a ‘corporate opportunity’ or one which is the ‘property’ [...]

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