Category Archives: Companies Act

What‘s the buzz about Business Rescue?

If a company/close corporation is in financial trouble and all possible avenues to save the business have been exhausted, there is one last option available, lodging an application for Business Rescue Only a company/close corporation that is “financially distressed” can … Continue reading

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Reinstatement of deregistered companies: Are they (and directors) liable for their actions during deregistration?

In terms of the current Companies Act, companies and CCs can be deregistered for administrative reasons (in the vast majority of cases for not lodging annual returns and paying annual duty) and can apply to be reinstated. An anomaly exists … Continue reading

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Are you a “prescribed officer”? If so, be aware of your onerous liabilities and responsibilities

The 2008 Companies Act introduced the concept of “prescribed officers” three years ago. They are senior employees (not directors) deemed by the Act to have the obligations of directors. As such they are bound by the duties and responsibilities of … Continue reading

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Shareholder resolutions: Be careful of the round robin!

Shareholders ultimately carry the most power in a company. Decisions are carried out via shareholders’ resolutions and it is important that these resolutions are correctly done. The Companies Act (“the Act”) specifically addresses the issue of resolutions. It also allows … Continue reading

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Special resolutions – when are they needed?

Resolutions by shareholders In terms of the Companies Act, No. 71 of 2008 (as amended) (“the Act”) and/or a company’s Memorandum of Incorporation (“MOI”), and the Shareholders’ Agreement (if applicable), certain corporate actions require the approval of the shareholders, which … Continue reading

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Solvency and liquidity test under the Companies Act 2008

The concept of capital maintenance has recently been excluded in the new Companies Act. Instead, section 4 of the Companies Act of South Africa, No 71 of 2008 (the Act) requires directors to perform a solvency and liquidity test when engaging … Continue reading

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Minutes of board meetings

Board meetings and the decisions made during these meetings may be determining for the effective functioning of a company. Clients are therefore reminded of the legal requirements relating to board meetings as stipulated in Section 73(6), (7) and (8) of the … Continue reading

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