Session 2: The Overarching Principle, Concepts Of The Act And Types Of Companies (CC’s And NPOs Included)

The Companies Act, No 71 of 2008, attempts to balance the rights and obligations between directors and shareholders

The Companies Act, No 71 of 2008, attempts to balance the rights and obligations between directors and shareholders

“Inter – related” means persons who are related to one another in a linked series of relationships

If there is an unconscionable abuse of the juristic personality of the company as a separate entity, the court may declare that the company is to be deemed not to be a juristic person in respect of…

fundamental requirement of the Companies Act is that companies protect their solvency and liquidity

Per S45, a company must ensure that a is solvent and liquid, as well as obtain a special resolution by shareholders prospectively before providing financial assistance to directors or related parties

Per derivative actions, a third party may take action on behalf of the company

If a company has not complied with their internal processes, per S20 the company may apply to have the contract declared invalid

Where the 1973 Act distinguished between public and private companies, the 2008 Act distinguishes between profit and non profit companies

If there is another statute applicable to a company that conflicts with the Companies Act, the more rigorous Act will apply