Dudu Myeni's stay at SAA illegal - CIPC tells Gigaba
The Companies and Intellectual Property Commission tells the finance minister Myeni has served three consecutive terms and is ineligible for any further extensions
South African Airways (SAA) chairperson Dudu Myeni’s stay at the helm of the airline’s board is illegal. She has served three consecutive terms as a non-executive director at SAA, making her ineligible for any further extensions to be on the board.
The Companies and Intellectual Property Commission (CIPC) has written to Finance Minister Malusi Gigaba, informing him about the illegality of Myeni’s contract extension both in terms of SAA’s memorandum of incorporation (MOI) and the Companies Act, which governs the appointments of directors.
The CIPC sent the letter to Gigaba on Thursday, in which it informed the minister that no notice had been filed with the regulator, telling it that Myeni’s contract had been extended. SAA had 10 business days within which to file notice of Myeni’s extension with the CIPC, which enforces the Companies Act. The national carrier has yet to file the notice.
Former finance minister Pravin Gordhan re-appointed Myeni to the SAA board as chairperson for one year in September 2016, in a move that was widely seen as a compromise. Her board contract ended on August 31, but Gigaba has extended it by just more than a month until November 3, when SAA is scheduled to hold its annual general meeting.
However, “Ms Myeni’s continued occupation of the position of director and chairperson of the board of SAA is deemed to be illegal”, wrote the CIPC in the letter, signed off by acting commissioner Andre Kritzinger and dated September 14.
The standing committee on finance has also given Gigaba seven days to provide supporting documentation to illustrate how he extended Myeni’s term, because the committee believed this to be irregular.
The CIPC wrote to Gigaba as the shareholder representative. “Clause 13.4.1 of SAA’s ... MOI states that a non-executive director shall hold office for a term of three years and shall not hold office for more than three consecutive terms. It is the CIPC’s understanding that Ms Myeni has served her three consecutive terms,” the letter said.
“Section 70 (1) of the act states that a person ceases to be a director when the person’s term of office as a director expires and in terms of section 70 (6) of the act, every company must file a notice with the CIPC within 10 business days after a person ceases to be a director of the company. To date the CIPC has not received this notification.”