Provisions Concerning Non-Profit Companies

In terms of the Companies Act 71 of 2008 (“Companies Act”) a non-profit company must have a memorandum of incorporation which sets out at least one object of the company. Each such objective must furthermore be either a public benefit objective or an object relating to one or more cultural or social activities, or communal [...]

Board Committees

Except to the extent that a memorandum of incorporation (“MOI”) of a company provides otherwise, the Companies Act No. 71 of 2008 (“Companies Act”) allows for the board of directors of a company to appoint any number of committees of directors and delegate any of the board of directors’ authority to such board committees. Generally, [...]

The Impact of Business Rescue on Employees

Business rescue has become a popular alternative to liquidation of a company. The Business Rescue procedure was introduced through section 6 of The Companies Act 71 of 2008 (“Companies Act”). One of the principal differences between the two is that, while under the supervision of the business rescue practitioner, the company continues to trade. The [...]

Board Meetings

Section 73 of the Companies Act No. 71 of 2008 prescribes the manner in which board meetings of a company must be convened. A director who is authorized by the board of directors: (i) may call a meeting at any time; and (b) is obliged to call a meeting if 25% percent of the directors [...]

London Visit During Black History Month

In celebration of Black History Month in October, Pieter van der Merwe and Marilize Jerling attended a legal conference in London in October 2017, representing both VDMA and South Africa in their attendance. Guest speakers at the conference included the Honourable Justice Albert ‘Albie’ Louis Sachs, a former judge of the constitutional court of South [...]

Ring-fenced Companies

Section 113(3)(b) of the Companies Act, 2008 (“Companies Act”) provides that a company’s name must be followed by the expression ‘(RF)’ if a company’s memorandum of incorporation contains the following: any restrictive conditions applicable to the company and any procedural requirement that impedes the amendment of any particular provision of the memorandum of incorporation; or [...]

A One-Stop Investment Shop

InvestSA is a South African investment agency which developed the “One Stop Shop” concept by integrating support from all government departments to provide investors with an investment facilitation service aimed at lowering the cost of doing business in South Africa and easing the degree of difficulty in doing business by providing strategic guidance and reducing [...]

The Election of Directors of Profit Companies

The election of directors of profit companies is regulated by section 68 of the Companies Act 71 of 2008 (“Companies Act”). In terms of Section 68 of the Companies Act, each director of a company, other than the first director, must be elected by the persons entitled to exercise voting rights in such an election [...]

The Transfer of Uncertificated Securities

Section 53 of the Companies Act No. 71 of 2008 (“Companies Act”) provides for the transfer of uncertificated securities in an uncertificated securities register. The Companies Act states that the transfer of uncertificated securities may only be effected by a participant (a person duly authorized by a licensed central securities depository to perform custody and [...]

Beware the Big Bad “Corruption Act”

Corruption is a plague which manifests itself in theft, bribery, extortion and other corrupt activities. Corruption affects every nation and in particular, it has been determined that approximately ZAR700 billion has been lost to corrupt activities over the last 20 years in South Africa. The South African legislator’s answer to the rampant corruption was the [...]

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