The Companies Amendment Bill, published in September this year, has proposed significant changes to the Companies Act, which became law in 2011. As the deadline for submitting comments to the Department of Trade and Industry has been extended to 14 December this year, it is a good time to reflect on the impact the Bill will have on business in South Africa.
- The Companies Tribunal will have the power to adjudicate cases referred to it by the B-BBEE commission. This will enable the B-BBEE Commission to forge strategic partnerships with various regulators to ensure compliance with SA’s empowerment laws.
- The renumeration of prescribed officers, including directors, will need to be disclosed. This will contribute to greater transparency.
- Certain companies, such as public or state-owned companies, will be obliged to set up a social and ethics committee.
- Shareholders will now be protected through a special resolution for share buyback. Share buybacks must be approved by a special resolution of shareholders if shares are to be bought back from a director, a prescribed officer or a person related to a director or a prescribed officer. This also applies if the buyback entails an acquisition other than an equal offer made to all shareholders or transactions effected in the ordinary course on a stock exchange.
- If a company grants financial assistance to its subsidiary, it will need to be authorised by the shareholders and the board through a special resolution.
If you wish to comment on the Bill, you can consult with us to discuss the full ramifications of the Bill on the way you do business in South Africa.