Did Sagarmatha obey the Companies Act?
Noncompliance with a basic requirement of the Companies Act is an extremely serious issue for a company looking for billions of rand of backing from investors. For this reason it’s important we get clarity on whether Sagarmatha Technologies submitted its financial statements to the Companies and Intellectual Property Commission (CIPC) as required by section 33 of the act.
Late on Wednesday, Sagarmatha issued a statement saying the JSE had withdrawn approval of the listing because Sagarmatha had not been compliant with the requirements of the act on March 28, the date approval had been granted.
Sagarmatha says this is not so and that on March 11 it received confirmation from the CIPC indicating it was compliant and had provided the required financial statements. Not only that but, said Sagarmatha, CIPC confirmed that at no stage was Sagarmatha not compliant. This is a major claim and presumably is quite easy to confirm one way or another.
The act requires Sagarmatha, whether listed or not, to submit annual returns and financial statements every year.
That it may or may not have been compliant with the JSE’s listing requirements at the time it made the application (and was granted approval) overshadows a possibly greater regulatory issue — has it been compliant with the act in the years since it was set up?
It’s ironic that a company with such grand ambitions should have been thrown off course so early by a comparatively mundane matter. If the JSE was correct in its reason for withdrawing approval then an uncomfortable spotlight will be thrown on Sagarmatha’s sponsoring brokers and advisers.
Shoprite’s employees seem to have had enough and the retailer doesn’t seem to be listening. Workers embarked on two nationwide protests in four months, targeting the busiest times for holiday shopping — an indication the management has done little to address their complaints. The company has about 148,000 workers in SA.
The latest protest action occurred in the two days leading up to Good Friday after workers and management failed to reach an agreement.
The South African Commercial‚ Catering and Allied Workers Union (Saccawu) said there were issues management and workers could not agree on, including those about workers’ safety, the reinstatement of some workers dismissed in Sandton for allegedly inciting labour instability in the workplace, and giving permanent employment to all part-time workers with five years or more service.
The majority of employees returned to work on Good Friday but it is unlikely this is the end of it.
What complicates matters even more is the involvement of the EFF in the protest action. At least 150 EFF members joined a protest, which turned violent and led to a branch being closed for the entire Easter weekend.
Shoprite management maintains it is open to engaging workers, but CEO Pieter Engelbrecht needs to resolve these disputes urgently.
While the Shoprite operations seem to be running smoothly, with the group reporting strong financial results, Engelbrecht, who is relatively new in the top position, needs to make his mark and ensure any lingering legacy labour issues are resolved favourably for all concerned.