What is the current status of Close Corporations? “Since 1 May 2011 no new Close Corporations may be registered in South Africa,” advises Dr John Hendrikse, co-author of the Corporate Governance Handbook (Juta) and the Business Valuations Handbook (Butterworth). “The New Companies Act in conjunction with amendments to the Close Corporation Act, allows Close Corporations [...]
Removal of Directors
Section 71(1) Despite anything to the contrary in a company’s Memorandum of Incorporation or rules, or any agreement between a company and a director, or between any shareholders and a director, a director may be removed by an ordinary resolution adopted at a shareholders meeting by the persons entitled to exercise voting rights in an [...]
Ring-Fenced Companies and the Doctrine of Constructive Notice
A ring-fenced company is a company whose MOI contains special conditions or prohibitions that prohibit the amendment of any particular provision of the MOI. Section 15(2)(b) and (c) allows a company’s powers to be restricted by informing the public that a company’s powers are either limited or restricted where a company’s name is followed by [...]
Regulated Versus Non-Regulated Company
It is important to note the difference between a Regulated and a Non-Regulated Company, in terms of the Companies Act, since it impacts on the Memorandum of Incorporation. In terms of Section 117 of the Act, a Regulated Company means a company to which sections 117-127, Chapter 5 of the Act and the Takeover Regulations [...]
Domesticated, External And Foreign Companies
A ‘domesticated company’ means a foreign company whose registration has been transferred to the Republic ito section 13(5)-(11) of the Act: A foreign company may apply the prescribed manner and form, accompanied by the prescribed application fee, to transfer its registration to the Republic from the foreign jurisdiction in which it is registered, and thereafter [...]
Conversion Of Par Value Shares To No Par Value Shares
Item 6 of Schedule 5 read with regulation 31 of the Companies Act of 2008, deal with the conversion of ordinary par value shares to no par value shares. There will be no disposal on conversion for the shareholders as contemplated in paragraph 11(1)(a) of the Eighth Schedule to the Income Tax Act, No 58 [...]
The Binding Effect Of A Company’s Moi
In terms of section 15(6) a company’s MOI and any Rules of the company are binding: between the company and each shareholder; between or among the shareholders of the company; and between the company and each director or prescribed officer of the company or any other person serving the company as a member of a [...]
New Definition of a Share
“The Taxation Laws Amendment Act, No 24 of 2011, added the definition of ‘share’ to section 1 of the Income Tax Act, No 58 of 1962,” says Heinrich Louw, an Associate in the Tax Practice at Cliffe Dekker Hofmeyr in a recent article. “With effect from 1 April 2012, a share was therefore defined as [...]
Naming Conventions Of The New Companies Act And The Moi
A company name may comprise one or more words in any language, irrespective of whether the word or words are commonly used or contrived for the purpose, together with any letters, numbers or punctuation marks, any of the following symbols: +, &, #, @, %, =, any other symbol permitted by the regulations or round [...]
Recent Articles
- Why your Company needs a new customised Shareholders’ Agreement to protect the Company and its Shareholders
- The Future of Close Corporations : Update
- New Association Agreement for Close Corporations
- Public Benefit Organisations and the Requirements of the Income Tax Act
- Share Block Companies: A Viable Option
Goodbye s21, Welcome s10 Non–Profit Company
New s10 Non–Profit Company versus old s21 Company The s10 non-profit company in terms of the 2008 Companies Act is the successor to the s21 company under the 1973 Act, which was also known as the incorporated association not for gain. Every pre–existing company incorporated in terms of s21 of the 1973 Companies Act is [...]