Shock and disbelief as Dutch base gets Christo Wiese off the hook
Steinhoff stuns investors and corporate governance analysts with confirmation that it prepaid Wiese €325m just before it collapsed
The benefits of registering Steinhoff in Holland became apparent once more as it emerged on Wednesday that Christo Wiese’s egregious self-dealing does not represent a contravention of Dutch company law.
On Tuesday, Steinhoff stunned investors and corporate governance analysts when it confirmed media reports that the company had prepaid Wiese €325m during October and November 2017 for Shoprite shares, just weeks before Steinhoff collapsed.
Unlike South African company law, there is no provision in the Dutch law requiring oversight of the provision of loans or financial assistance to directors. Section 45 of the South African Companies Act requires a board resolution and also requires that shareholders agree to any payments made to directors.
Dutch law allows companies to make loans to their directors and merely requires that the management board approves the loan.
In addition, the Steinhoff articles of association do not deem a loan to a director to represent a conflict of interest.
A Dutch legal expert said it was staggering that someone in Wiese’s position was able to conduct these sorts of transactions with the company.
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