Deneys Reitz Papers - New Companies Bill

• Companies Bill 2008 – Directors and Officers Insurance – Almost right at last: Michael Hart, Chairman of Deneys Reitz
• The Companies Bill: Changes to the takeover regime: Kevin Cron, director and head of Commercial Division
• Companies Bill 2008 – Here comes the class action!: Michael Hart, Chairman of Deneys Reitz

Companies Bill 2008 – Directors and Officers Insurance – Almost right at last: Michael Hart, Chairman of Deneys Reitz

It may seem churlish to complain about Section 78(6) of the Companies Bill 2008 given that it goes a long way to fixing the problems which have bedevilled the attempts to get the legislation dealing with directors and officers insurance in line with industry expectations and the recommendations on the topic in both of the King Reports.

The problem has been the convoluted wording (described as “ambiguous” in King II) of Section 247 of the existing Companies Act. The subsection renders it unlawful for a company to exempt a direct or officer from liability resulting from negligence, default, breach of duty or breach of trust. It goes on to provide that the subsection is not applicable to insurance taken out and kept by the company as indemnification against such liability of any director or officer towards the company.

Click here to read the full article (PDF file 83kb)

The Companies Bill: Changes to the takeover regime: Kevin Cron, director and head of Commercial Division

The new Companies Bill contains certain proposals which, if adopted, will fundamentally alter the rights of shareholders arising out of takeovers and mergers. The Bill introduces the concept of “fundamental transactions”, of which there are three. In addition, the Bill deals with mandatory offers and takeover offers.

The three fundamental transactions are:

Click here to read more (PDF file 97kb)

Companies Bill 2008 – Here comes the class action!: Michael Hart, Chairman of Deneys Reitz

Should it survive in its existing form, Section 157 of the Companies Bill will bring the class action into mainstream corporate and commercial activity in South Africa. To date the class action has been a seldom-used procedure, restricted in its application to matters involving actual or threatened infringement of rights protected in the Bill of Rights.

Section 157 will change all of that when, in terms of the Act, an application can be made to, or a matter can be brought before, a court, the Companies’ Ombud, the Take-over Panel or the Commission, that right can be exercised by a person who is:

Click here to read more (PDF file 87kb)