Reducing the regulatory burden in SA
Proposed amendments to the Companies Act are meant to close loopholes and bring SA practice in line with broader trends. The reduction of regulatory burden is welcome, but some aspects are problematic
Two events last month may just shake up the sometimes staid landscape of corporate SA. First, the JSE released a consultation paper containing the most substantive changes to its listing requirements since the first King code in 1994. Then, two days later, the department of trade & industry (DTI) put out its proposed amendments to the Companies Act – the most substantial since 2011. The DTI says the proposed changes in its Companies Amendment Bill are intended "to keep up with the current trends and also close some loopholes in the act" that have been discovered since its implementation in 2011. Unlike the JSE’s proposals, not all of the long-awaited amendments to the Companies Act seem intended to create a "trusted space" for investors. Some will simply make it easier for companies to operate. For example, section 45 of the act governs the provision of loans or financial assistance to company directors or subsidiaries. These are subject to particular requirements, including that th...