Masters Degrees (Mercantile Law)

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An assessment of the South African law governing breach of contract : a consideration of the relationship between the classification of breach and the resultant remedies
(Stellenbosch : Stellenbosch University, 2004-04) Venter, Cindy Michelle; Lubbe, G. F.; Stellenbosch University. Faculty of Mercantile Law. Dept. of Law.
ENGLISH ABSTRACT: The South African system of breach of contract recognizes several distinct forms of breach. each encompassing its own set of requirements. Before one is able to determine the outcome and accordingly the rights of each contracting party in respect of an alleged breach of contract. the factual situation must be fitted into one of the recognized forms of breach. This has resulted in a highly complex system of breach of contract and resultant remedies. The existence of a direct relationship between the form of breach present in a factual situation and the remedies available to the innocent party is a fundamental premise of South African law and one that is often accepted without much investigation. This thesis investigates the extent of this interdependence and to establish whether this intricate system is necessary from a practical and a theoretical point of view. To this end. the thesis examines the less complex system of breach of contract as embodied in the United Nations Convention on Contracts for the International Sale of Goods C·CISG'·) which has been widely adopted in international trade. and which has provided a template for the reformation of various national systems of law. This study concludes that the South African approach to breach of contract and remedies is in need of reform. and that a unitary concept of breach could provide a basis for both a simplification and modernization of our law.
Balancing mining and the environment : South Africa’s legal framework concerning pollution caused by mining, with examples from the West Rand and Emalahleni.
(Stellenbosch : Stellenbosch University, 2023-03) Knutton, Keeley Marie; Ruppel, Oliver Christian; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: Environmental law is a continually growing sphere of law, both locally and internationally. The increase in the importance and presence of environmental law in South Africa, and on a global scale, is as a result of the impacts that human activities have on the environment. These environmental impacts caused by human activities have resulted in there being an escalation in the need to conserve and protect the environment. Section 24 of the Bill of Rights of the Constitution of South Africa incorporates the principle of environmental protection and sustainable development into the constitutional law of South Africa, and generally recognises the fundamental importance of the environment, whilst the National Environmental Management Act 107 of 1998 and the environmental legislation and measures that have followed its adoption address this right as well as various elements of environmental protection, conservation and mitigation. This research focuses on the environmental elements of water and air, which are both vastly impacted on and polluted by the mining industry.
The carbon border adjustment mechanism as an alternative to free allocation of certificates in the European Emissions Trading System. An analysis based on the WTO non-discrimination principle
(Stellenbosch : Stellenbosch University, 2023-12) Baake, Arvid Luca; Ruppel, Oliver Christian, 1969-; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: This research paper examines the European Union´s Carbon Border Adjustment Mechanism (CBAM) and its compatibility with the non-discrimination principle under WTO law. With the CBAM, the European Union (EU) wants to promote decarbonisation in countries outside the EU and reduce the risk of carbon leakage. Carbon leakage describes the migration of industry to countries with less stringent climate regulations than, for example, the EU under the European Emissions Trading System (EU ETS). Before analysing the CBAM and WTO law, the paper shows the weaknesses of free allocation of certificates from an economic and legal perspective. The free allocation was the European Union's previous measure to avoid carbon leakage risk. The following analysis of WTO law focuses first on the Most-Favoured-Nation (MFN) principle before concentrating on the National Treatment (NT) principle. Subsequently, potential exceptions under the GATT are examined. Ultimately, it is argued for the applicability of the exceptions Art. XX (b) and (g) GATT, which neutralises the violation of the principle of non-discrimination that has been established before. The research concludes with remarks on the relationship between EU and WTO law and a possible export rebate under the CBAM.
Comparison of post-employment restraints in South Africa, England and Germany
(Stellenbosch : Stellenbosch University, 2003-12) Guhl, Christian Andreas; Sutherland, P. J.; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: This dissertation deals with restraints in post-employment cases in England, South Africa and Germany. The attempt was made to compare the restraint of trade doctrine that was developed in England and is still used in the common law countries, on one the hand, and the German restraint of trade rules on the other. Therefore the development of the restraint of trade doctrine in England is described, as well as the modifications of the restraint of trade doctrine in South Africa. Also it is given an overview of the German restraint of trade rules. As far as the English and South African law is concerned, the historical developments and applicable principles of the restraint of trade doctrine are emphasised, whereas the main aim in the German part is to give an overview about the codified restraint of trade rules. While comparing the common law doctrine and the German restraint of trade law it is emphasised that in the common law countries the reasonableness and public interest plays an important role, whereas in German restraint of trade law, on the other hand, the payment of compensation is an important matter.
Control of mergers between newspaper enterprises under South African and German competition law
(Stellenbosch : Stellenbosch University, 2005-12) Janka, Sebastian Felix; Sutherland, Philip; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law
ENGLISH ABSTRACT: This thesis compares South African and German Competition Law. The focus is the control of mergers between newspaper enterprises. It has to be asked whether special rules should apply to transactions in this field, considering the importance of an unconcentrated, competitive press from an economic and political point of view. It will be shown that South African and German Competition Law are similar in many respects. Both legal systems follow a flexible, primarily economic approach to the consideration of proposed transactions, taking into account a plurality of factors to determine potential detrimental effects of mergers on competition. Moreover, pro-competitive gains and public interest issues are recognised under South African and German law. When it comes to the control of mergers between newspaper enterprises, though, the two legal systems diverge. Only under German Competition Law, are there specific provisions for press mergers. In view of a recently proposed amendment of the German Competition Law, the appropriate form of regulation that is likely to guarantee a free press, will be investigated. It will also be analysed, whether there is a specific need for press regulation in the South African context. Even though there are no special provisions under South African Competition Law, the South African Constitution leaves space for a broader understanding of the freedom of the press. Hence, it will be examined if the South African Constitution obliges the state to enact particular laws to protect press-plurality. Moreover, it will be analysed if the South African Competition Act should be interpreted in a manner that would promote plurality of the press. In the view of the eminent role of the press for a democratic society, it will be argued in this thesis, that there is a particular need for media regulation. Notably the significant levels of concentration in both German and South African press markets raise concerns as regards the protection of a free and pluralistic press. It will be shown that there are different foreign approaches to maintaining and promoting freedom of the press and it will be suggested that South Africa recognises a need for more press-specific regulation in the future.
Critical analysis of the institutional framework governing the agreement establishing the African Continental Free Trade Area
(Stellenbosch : Stellenbosch University, 2023-12) Lehlongwa, Thulane Charlo; Ruppel, Oliver Christian, 1969-; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT : The African Continental Free Trade Area as a flagship project of Agenda 2063 represents renewed attempts by the African Union to drive the continent closer to its economic integration ambitions, which can be formally traced back to the adoption of the African Declaration on Cooperation, Development, and Economic Independence, and later the Treaty Establishing the African Economic Community. Building on these frameworks, the AfCFTA seeks to, amongst others, advance intra-African trade by creating a single market for goods and services facilitated by the movement of persons, promoting sustainable and inclusive socio-economic growth, creating a liberalised market for goods and services, and promoting industrial development. Central to the attainment of the objectives of the AfCFTA is a well-functioning and effective institutional framework at a continental, regional, and national level all well-integrated to facilitate and oversee its implementation. The strengthening of regional and continental institutions to effectively lead and drive Africa’s transformation agenda has also been recognised by Agenda 2063 as a key enabler to this end. The demise of previous African integration efforts has mainly been attributed to the weakness of regional and continental organs to be able to effectively oversee and administer the implementation of continental programmes by the countries. This thesis appraises the institutional framework established to oversee the implementation, administration, facilitation, and monitoring of the AfCFTA, and this is considered against the broader African Union institutional framework and the regional economic communities. Although vastly different, the thesis further considers the experience and best practices from the European Union regional integration model to draw lessons and with a view to reforming and integrating African continental and regional bodies to be able to effectively oversee key initiatives including the AfCFTA. Finally, the thesis considers some of the work already initiated by the AU to review and reconfigure the extant continental bodies and then recommends some key interventions to reinforce and better integrate the institutional framework of the AfCFTA with the existing continental and regional frameworks.
A critical analysis of the interpretation of the term "associated enterprise" in provisions in South African double taxation agreement based on Article 9 of the Organisation for Economic Cooperation and Development's Model Tax Convention on Income and on Capital
(Stellenbosch : Stellenbosch University, 2020-12) Greeff, Andre; Du Plessis, Izelle; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: To the extent that a contracting state has no applicable double taxation agreement (“DTA”) in place, that contracting state will rely solely on its domestic law to regulate transfer pricing related matters. Many states, however, enter into DTAs that are intended to inter alia reduce the risk of economic double taxation. Most of these DTAs are based on the Organization for Economic Cooperation and Development’s Model Tax Convention (the “OECD’s MTC”). Article 9 of the OECD’s MTC aims to prevent transfer pricing manipulation by associated enterprises, as well as to provide associated enterprises with relief from economic double taxation. However, Article 9 is only applicable if “an enterprise of a contracting state participates … in the management, control or capital of an enterprise of the other contracting state, or the same persons participate … in the management, control or capital of an enterprise of a contracting state and an enterprise of the other contracting state.”1 DTAs, however, generally do not define the terms contained in the phrase “participates in the management, control or capital.” This may result in uncertainty regarding the applicability of a DTA provision identical to Article 9 of the OECD MTC. This dissertation illustrates the possibility of economic double taxation arising as a result of a corresponding contracting state disallowing a requesting for a corresponding transfer pricing adjustment in terms of a DTA provision identical to Article 9(2) of the OECD MTC due to such state disagreeing with the initial primary adjustment. Such disagreement may arise due to differing interpretation of the term “associated enterprise.” It appears that there are at least two possible solutions to eliminating economic double taxation from arising as a result of a primary transfer pricing adjustment. The first being for contracting states to agree to an autonomous or universal definition of an associated enterprise (which would arguably require consensus amongst all contracting states that the context of Article 9 requires otherwise than to interpret the terms therein in accordance with the domestic law of a particular contracting state). The alternative would be for contracting states to apply the modified “new approach” (that is, the DTA is to be interpreted in accordance with the contracting state applying the DTA), which would arguably require contracting states to ignore the existing paragraph 6 of the Commentary on Article 9 of the OECD MTC.2 Considering the historical context of Article 9, together with the purpose thereof, it is concluded that “participation in management or capital” ought to be interpreted as meaning that a person requires a dominant level of participation in management or capital in order to be associated. Regarding “control,” it is concluded that the context of Article 9 (in the form of the Commentary to Article 93 and the OECD Transfer Pricing Guidelines (“”TPG”)4)requires “control” to be interpreted as de facto control in the narrow sense.
A critical analysis of the legality of racial quotas as a tool for transformation in South African professional sport
(Stellenbosch : Stellenbosch University, 2021-03) Horne, Keenan; Louw, Andre M.; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: South Africa is a country steeped in sport, which is an important part of the culture of large parts of the population. The new political dispensation in South Africa that came into existence in 1994 recognized the inequalities that had negatively affected South Africans in sport and in other areas of their lives, over the span of many years. It prompted government to introduce affirmative action measures in sport as in other areas of the lives of South Africans. After 26 years these affirmative action measures that have been implemented in sport still remain a challenge for sports governing bodies, and are still controversial. This dissertation aims to delve deeper into these affirmative action measures and, specifically, to critically analyze the legality of racial quotas in professional sport in South Africa as a tool to accelerate transformation. The dissertation will focus on the fact that sport provides an atypical context for the application of affirmative action, but one that is still subject to laws. It will be shown that professional athletes in South Africa qualify as employees under labour legislation, and are consequently protected by the same rules as more traditional employees. This raises an interesting question for legal analysis. South African labour legislation expressly prohibits the use of racial quotas in the application of affirmative action. Despite this, South African sporting codes have for a number of years employed racial quotas for the composition of representative teams (examples of which will be mentioned and examined). Because of the applicable constitutional and legislative framework for the application of affirmative action, the dissertation analyses the use of racial quotas through evaluation of the jurisprudence on affirmative action outside the sporting context in South Africa, in order to draw conclusions regarding the lawfulness of the use of such quotas in sport. There is a relative dearth of case law specifically on the issue of racial quotas. As a result, a comparative analysis is undertaken in respect of the United States of America, a jurisdiction which has grappled with the legitimacy of racial quotas for much longer than South Africa, and which has developed legal precedent on the issue.The dissertation also deals with the concept of ‘representivity’ within the context of the transformation of South African sport. This is a term that has become synonymous iii with transformation, both in sport and in society more generally. The dissertation focuses on the concept of ‘equitable representation’, which is the express objective of affirmative action under the Employment Equity Act. Equitable representation, ostensibly, means to pursue the achievement of a level of representation in workplaces which mirrors the national or regional racial demographic profile of the population. In the context of professional sports teams, when affirmative action measures are applied the aim is therefore to select a team which is representative of the racial demographic profile of the South African population. The dissertation investigates this concept and its role in transformation in South Africa, as well as its legitimacy in the context of professional sport. Apart from the above-mentioned analysis of domestic law, the dissertation also examines the legitimacy of the application of racial quotas in the broader context of international sports governance. It considers the legitimacy of transformation measures as applied by South African sports governing bodies within the parameters of the relevant rules, principles and regulations of international sports governing bodies. This analysis highlights the anomalous nature of racial quotas in professional sport, both in the domestic and international contexts. South African sports governing bodies are contractually obliged to govern their respective sporting codes in a manner that complies with the rules of international bodies, and the dissertation also focuses on the potential danger of pushback from international sports governing bodies against domestic transformation measures which flout international rules. Finally, the dissertation investigates potential justification for racial quotas in professional sport in South Africa. It briefly evaluates the role that sport plays as a tool for nation-building and reconciliation, and then considers whether racial quotas could be justified as a means to remove inequalities and to create equal opportunities for all races in professional sport.
Determining the residence of a trust : a South African income tax perspective
(Stellenbosch : Stellenbosch University, 2013-12) Muller, Catharina Petronella Johanna; Oosthuizen, P. G.
ENGLISH ABSTRACT: In the tapestry of history the subjects of trusts and taxes are frequently interwoven. Owing to such frequent interaction, one may assume that all signifcant aspects regarding the taxation of trusts have long since been resolved. This would be an incorrect assumption as for example, one quite fundamental and important issue, the tax “residence” of a trust, has not been adequately considered. Residence forms the cornerstone of our taxation system in South Africa and is an important pre-requisite for taxes to be imposed upon a trust. Yet as the residence of a trust has received little attention from South Africa's legislature, judiciary, fiscal authorities and legal authors, it remains an area of uncertainty, which potentially undermines our taxation capacity. This thesis therefore seeks to address this lacuna in our law. In South Africa, the Income Tax Act, 58 of 1962, provides a definition for the term "residence." This statutory definition is critically analysed so as to assess its meaning and practical application in a trust setting. In so doing, certain deficiencies and aspects giving rise to uncertainties are identified and recommendations made for the legislature to intervene. The guidance provided by the South African Revenue Service in its Interpretation Notes, and Discussion Paper, is also assessed. Historical judicial precedent is reviewed and the recent case of the Oceanic Trust Co Ltd No v Commissioner of SARS which dealt specifically with this topical issue, considered. The approach followed in South Africa is further compared to that followed in the international tax treaty setting, and in particular, the Organisation for Economic Co-operation and Development's (OECD) model tax convention and its commentaries, critically analysed. More specifically the approach in two foreign jurisdictions, Canada and the United Kingdom, are also investigated so as to identify suggestions for possible reform and development. Against the underlying justification for a residence-based taxation and the objectives it seeks to achieve, an analysis of the various tests for the residence of a trust is conducted so as to determine the most appropriate and effective test to be applied in the South Africa income tax setting, and recommendations made.
Developing a framework for mediating farm evictions and security of tenure related disputes in South Africa
(Stellenbosch : Stellenbosch University, 2022-03) Roode, Nikita; Stander, Nikita; Broodryk, Theo; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: This dissertation is concerned with the lack of a proper framework regulating the mediation of farm evictions and security of tenure related disputes in South Africa. The Land Reform (Labour Tenants) Act, 3 of 1996 (‘the LTA’) and the Extension of Security of Tenure Act, 62 of 1997 (‘ESTA’) were enacted on 22 March 1996 and 4 February 1997, respectively, to specifically provide for the protection of the rights of residence of occupiers residing on agricultural land. Although these statutes contain occasional references to mediation, they do not provide a proper framework for the mediation of farm evictions and security of tenure related disputes. The uncertainty caused by the absence of a proper framework that regulates the mediation of farm evictions and security of tenure related disputes, legislative or otherwise, results in mediation being underutilised and ultimately has the effect that our courts continue to be inundated with evictions and security of tenure related applications. This is because it is unclear, for example, when disputes in terms of ESTA and the LTA may be referred to mediation; what the procedure is that should be followed during the mediation process; who bears responsibility for payment of the mediator’s costs; how the mediator should report on the outcome of the mediation; what the relevant mediation timelines are; and so forth. Farm eviction disputes usually involve poor, vulnerable and marginalised persons who stand to be left homeless and destitute by an eviction order. It is therefore vital that a clear and concise mediation framework be developed to facilitate the resolution of farm evictions and security of tenure related disputes without the parties necessarily having to resort to costly and time-consuming litigation. Ultimately, the purpose of the dissertation is to assist in developing a framework regulating the mandatory mediation of disputes instituted in terms of ESTA and the LTA. This will be achieved by comparing and analysing the legal position regarding the mediation of farm evictions and security of tenure related disputes in South Africa, including the mediation provisions and rules applicable in South African Magistrates’ Courts and High Court divisions, and the legal position applicable to mediation in the United States, Ontario, and Australia.
Geslag en Regstellende Aksie in die Werkplek
(Stellenbosch : University of Stellenbosch, 2005-03) Loots, Barbara Evelyn; Garbers, C.; University of Stellenbosch. Faculty of Law. Dept. of Mercantile Law.
The concept of affirmative action, in contrast to discrimination, does not have a universal uniform meaning. On the one hand affirmative action can be seen as an attempt to promote equal opportunities for individuals or groups previously disadvantaged by discrimination. On the other hand, its application is controversial when black people, women and disabled people are given preference, for example, when decisions are made that preclude the appointment of better-qualified candidates. Affirmative action therefore has pros and cons, depending on the approach adopted. In South Africa affirmative action, as defined in s 15 of Employment Equity Act 55 of 1998 (EEA), is seen as a measure that ensures equal employment opportunities and equitable representation of suitably qualified people from designated groups. Affirmative action thus enjoys legislative recognition and is judicially developed by the courts. Nonetheless the concept is problematic. A specific concern is the fact that the meaning of affirmative action is even more elusive when the conceptual relationship to discrimination and equality is examined in an effort to identify its theoretical foundation. Affirmative action is aimed at pursuing working conditions that promote a real, and not just theoretical, realisation of rights. It focuses on addressing the burden of discrimination, which is still borne by certain groups in society. In Harmse v City of Cape Town [2203] 6 BLLR 557 (LC), the court found that the broader idea of constitutional equality implies that the elimination of unfair discrimination includes affirmative action. The court based its reasoning on s 9(2) of the equality clause of the Constitution, wherein provision is made for measures, such as affirmative action, that are “designed to protect or advance persons, or categories of persons, disadvantaged by unfair discrimination…” In Dudley v City of Cape Town [2004] 5 BLLR 413 (LC) the court found that the EEA distinguishes between the prohibition of unfair discrimination and affirmative action, as contained in chapters II and III of the Act, regarding approach, aim and application. This however does not imply that the two concepts are in no way connected. Another area of concern relates to doubts surrounding the effectiveness of affirmative action. The gender gap in the workplace becomes apparent when the labour market composition is taken into consideration. This emphasises the fact that affirmative action is not accomplishing sufficient transformation to further equality in the workplace. The origin of the problem lies in the fact that the impact of affirmative action depends on the approach to equality (be it formal equality, equality of opportunities or substantive equality) that it is designed to promote. Another affirmative action dilemma is the problem of enforcement of measures of this nature. Other alternatives, such as diversity management where both the employer and the employees benefit, should possibly be considered as a method of effectively empowering women to ensure that they can compete successfully with men in the labour market. Diversity management ultimately appears to have a social, as well as an economic advantage in the development of equitable representation of disadvantaged groups in the labour market.
Holding multinational corporations liable for their transnational environmental harms : a search for global liability
(Stellenbosch : Stellenbosch University, 2023-03) Roxburgh, Craig; Stevens, Richard; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH SUMMARY : For several decades, environmentalists have raised the alarm regarding the impending environmental catastrophe that results from the Anthropocene. Much attention has been given to the role that States play in contributing to ecological damage being wrought upon the Earth. However, we have only looked at the environmental destruction perpetrated by multinational companies (“MNCs”) in the past decade. Natural disasters like the Deepwater Horizon explosion have placed MNCs' dangerous impact on the environment in sharp relief. At the same time, revelations in the Carbon Majors Report and global litigation quantify the damage MNCs cause to the environment. Multinational companies (“MNCs), as a result of globalisation and trade liberalisation, are powerful entities within the global economy. Despite their size, MNCs remain primarily unregulated in international human rights law. Debates regarding who bears the duty for human rights intersect with a battle of political will between the Global North and Global South for developing binding human rights duties for MNCs. As a result, they can commit environmental harm, especially in the Global South, with relative impunity due to a lack of effective liability mechanisms. The doctrine of separate legal personality creates specific issues for holding MNCs liable for environmental harms in the Global South. Domestic courts in home States struggle to exercise jurisdiction over the environmental harms MNCs commit. In contrast, systemic barriers in host States create situations where victims are unable to seek redress within their State. To address these concerns, this thesis proposes a global liability regime founded on the principle of integrated regulation. This regime will utilise regulation at the institutional, national and international levels to enforce the environmental obligations of MNCs, rooted in the right to a healthy environment. This gives rise to multiple intersection human rights obligations which will regulate the behaviour of MNCs. This thesis recognises that such a framework requires a drastic reform in how the law and companies are conceptualised. However, such a reform would have wide-reaching implications for vindicating human rights violations.
How to copy a song with impunity : a legal perspective on copyright infringement cases for musical works
(Stellenbosch : Stellenbosch University, 2015-03) Rogowski, Adrian; Dean, Owen Henry; Stellenbosch University. Faculty of Law. Department of Mercantile law
ENGLISH ABSTRACT: Music has, and continues to play, an important role in society. It is therefore natural that more music composers enter the scene to capitalize upon this role that music has in society. It is however becoming more common place for music composers to start copying each other, either directly or indirectly. Fortunately, copyright laws have been developed to further protect the rights enjoyed by copyright holders, such as music composers, and these laws essentially protect the composers from the unlawful reproduction of their original music. Copying is, to some degree, inevitable, therefore, the question asked by this paper is to what extent is someone entitled to ‘copy’ from another person without it amounting to copyright infringement. In determining if there is copyright infringement, two tests must be applied and satisfied, namely, the causal connection test, and the substantial similarity test. Causal connection is usually met by establishing whether the alleged infringer had access to the original work. The substantial similarity test is the focus of this paper. The courts rely on this test to determine if that part which was reproduced from the original work is of substance i.e. if it is a part of the work which attributes uniqueness and quality to the original song. Of course, this test is notoriously difficult to understand and apply, hence the need for this paper to address the question on when there is substantial similarity in two works. This paper is of benefit to academics, authors (musicians) and lawyers, as not only is the substantial similarity test discussed from a theoretical point of view, but the question of when something is substantially similar is answered from a pragmatic point of view. It is hoped that this paper is used as a guideline in understanding and applying the substantial similarity test in music copyright infringement cases.
Judicial management as a technique for corporate rescue. A comparison with English and Australian law
(Stellenbosch : Stellenbosch University, 2000-03) Kloppers, Pieter W; Butler, David; Stellenbosch University. Faculty of Law. Department of Mercantile Law.
ENGLISH ABSTRACT: Judicial management has been part of South African company law since 1926. It was introduced as a procedure to provide for a corporate rescue. Judicial management has changed little since its introduction. This is in stark contrast with the position in other jurisdictions where the need for improved corporate or business rescue procedures has received considerable attention in the last few decades. This thesis examines the suitability of judicial management as a business rescue procedure for the current South African circumstances and compares it to similar mechanisms in England and Australia. The modem economy relies on credit. Furthermore the globalisation of markets and the increase in competition between enterprises add to the unpredictability of an enterprise's economic circumstances. Thus, one of the important objectives of a corporate insolvency regime is the preservation of viable economic enterprises. A business rescue procedure such as judicial management is therefore an essential component of a corporate insolvency regime. However, judicial management needs reform. The existing shortcomings of judicial management include its high cost, the appointment of professional liquidators as business rescuers, the lack of a business rescue culture, the absence of an approved rescue plan, the treatment of judicial management as an extraordinary measure in corporate insolvency and the use of section 311 of the Companies Act as a corporate rescue mechanism. This thesis proposes that judicial management should commence with a mere resolution by the directors. This is less cumbersome than the existing procedure to commence judicial management comprising a court order. Judicial management triggers a stay of limited duration on legal proceedings that provides an essential breathing space to devise and implement a rescue plan. Once judicial management commences the creditors should hold the power to decide on the future of the company. They can therefore accept or reject a rescue plan (prepared by the judicial manager) for the restructuring of current rights and obligations and for the future management of the company. During judicial management and the execution of the rescue plan, control of the company's assets vests in the judicial manager and directors lose their powers of management. Judicial managers should be encouraged to make a success of judicial management by providing that the judicial manager cannot be appointed as the liquidator in a subsequent liquidation. Furthermore, the burden of the costs of judicial management could be eased by providing a more flexible system for the remuneration of the judicial manager. A statutory business rescue procedure interacts with other components of an insolvency regime and other areas of law. In order to optimise the positive effects of a business rescue procedure certain changes are proposed regarding statutory provisions on insolvent trading, the phenomenon of phoenix companies, section 311 of the Companies Act and tax legislation. The thesis also proposes a smooth transition from judicial management to voluntary liquidation. The thesis has an annexure with draft legislation to give effect to the principal changes proposed by it for the Companies Act.
Korporatiewe bestuur en die demografiese profiel van nie-uitvoerende maatskappydirekteure in Suid-Afrika
(Stellenbosch : University of Stellenbosch, 2007-03) Dippenaar, Annelene; Van Wyk, A. H.; University of Stellenbosch. Faculty of Law. Dept. of Mercantile Law.
The collapse of Enron, WorldCom and other companies and the worldwide adoption of codes of good corporate governance have highlighted the poor standard of corporate governance systems and brought about big changes in this field. Corporate scandals in Britain and South Africa have contributed to greater local awareness of the failings of traditional company governance. In the Anglo-Saxon system non-executive directors are important watchdogs over powerful executive directors and other managers who are in a position to abuse their powers to the disadvantage of the shareholders. As independent supervisors non-executive directors are in a position to protect the interests of shareholders and prevent the manipulation of power relationships by executive managers. Independent supervision is of the outmost importance to ensure effective corporate governance. It contributes to the objectivity of the decision-making process and also to the appointment of other efficient non-executive directors. Independence of non-executive directors is influenced by the limited candidates in the pool from which they are appointed. This leads to a limited number of non-executive directors serving on multiple boards of directors, which in turn compromises their independent supervision function. The promotion of diversity on company boards, can expand the “limited gene pool” of non-executive directors. The question arises whether black economic empowerment, as a mechanism to promote greater diversity, has in South Africa contributed to a wider gene pool from which non-executive directors are appointed? In this study it is concluded that, instead of widening the gene pool of non-executive directors, black economic empowerment is creating a second “gene pool” of black directors who serve on multiple boards and with potential implications for their independence.
The law relating to the supervision of banks : a comparison between the Federal Republic of Germany and the Republic of South Africa
(Stellenbosch : Stellenbosch University, 1998-11) Krammig, Andreas; Hugo, C. F.; De Waal, J.; Stellenbosch University. Faculty of Law. Dept. of Mercantile Law.
ENGLISH SUMMARY: Banks are one of the most important elements in the economic cycle of modem society. As money replaced bartering banks have gradually moved into the pivotal point of the relations between participants in the economic cycle. No project can be realized without money today. On the one hand, there are the investors who, irrespective of the amount, entrust their assets to the banks. On the other hand, there are those whose financial needs require the granting of some form of credit. Banks operating in these contexts clearly bear important responsibilities towards the different parties. A third party, the state, is also interested in a well-functioning banking establishment. Economic stability, without which there can be no political stability, cannot otherwise be ensured. The state is accordingly keenly interested in maintaining the operability of this system. To this end, various laws are made in the respective countries aimed at supervising the banking industry. This work deals with some of the legislation relating to bank supervision in the Federal Republic of Germany and the Republic of South Africa. In the various chapters certain aspects of bank supervision in the two countries are identified, juxtaposed and compared. The reasons for any differences are sought, discussed and where possible explained. From a historical point of view, the two countries developed differently. Nevertheless, the need to regulate this sector through legislative means arose at an early stage in both. Unfortunately, the catalyst for legislative development was mostly some or other financial crisis. Any measures for supervising banks must, to be binding, be constitutional. In this regard much must still be done in South Africa due to the fact that the New Constitution has only been in force since 1996. Thus certain regulations stemming from the Banks Act 90 of 1994 need to be reconsidered in the light of the constitution. Bank supervisory activity is performed by a national institution in both countries. Germany avails itself of an independent authority. However, in South Africa it is one of the tasks of the central bank which has established a specific office for this purpose. Legal and natural persons alike are subject to such supervision. Diverse other government institutions provide support for such supervisory work in both countries. The scope of banking supervision, that is the persons and transactions affected, is broad and also finely meshed. Both systems list a number of banking transactions that are subject to their supervision. This affects all domestic banks and all foreign banks that are domestically active. Access to the banking business is only permitted in both countries after an appropriate license has been granted. The license can be conditional. Moreover, both systems make provision for the revocation of the license in appropriate circumstances. The conducting of banking business without the necessary permission is forbidden in both countries under the threat of legal punishment. It is well recognized in modem society that legal subjects should be protected against the decisions of those who wield state power. The possible remedies of those affected by the decisions of the public authorities responsible for banking supervision in the different countries are investigated in conclusion.
The legal regulation of corporate governance with reference to international trends
(Stellenbosch : University of Stellenbosch, 2005-12) Horn, Roelof Combrinck; Sutherland, P. J.; University of Stellenbosch. Faculty of Law. Dept. of Mercantile Law.
Corporate governance is defined as the system by which companies are managed and controlled. The concept came to the fore with the Cadbury Report in England in 1992 and has since been the topic of much academic discussion. The recent collapse of companies like Enron and WorldCom raised serious questions about international corporate governance practices. This has resulted in widespread reform. In the United States large-scale prescriptive measures were implemented through the enactment of the Sarbanes-Oxley Act. The United Kingdom persisted with their principle-based approach of comply or explain, although some amendments were made to the Combined Code through a joint effort by the Co-ordinating Group on Audit and Accounting Issues, the Smith Report and the Higgs Report. In Australia change took the form of the ASX Corporate Governance Principles and CLERP 9. South Africa, influenced by its common law background, followed a similar approach to that of the United Kingdom but has recently adopted a more prescriptive approach similar to that of the US. The King Committee was set up to review corporate governance in South Africa and two reports report were published – one in 1994 and another in 2002. Amendments to the JSE Listings Requirements followed. The Konar Report made recommendations on the reform of the accounting and auditing profession. The Department of Trade and Industry has recently launched a review of South African company law in conjunction with a review of the audit and accounting professions. These recent developments in company law will however not be discussed in depth as it is at a very early stage and is still subject to change. The aim of this study is to evaluate and determine whether or not the reform in South Africa is adequate to address the questions raised by recent corporate scandals in South Africa. The question also has to be asked whether South Africa should follow international trends in reform just for the sake of reforming. This requires an understanding of the principles underlying corporate governance and the reasons for the existence of corporate governance rules. With the increasing separation between ownership and control the accountability of directors has waned considerably. When addressing corporate governance issues, this must be kept in mind constantly. While the focus of recent reform has been on the company, its directors and auditors, the role of shareholders should not be ignored. What is needed to prevent directors and managers from abusing their positions of power are more informed and involved shareholders. The different role players must also cooperate in developing a culture of ethical behaviour and an environment of openness and accountability.
The legal regulation of the external company auditor in Post-Enron South Africa
(Stellenbosch : University of Stellenbosch, 2009-03) Drake, Hannine; Van Wyk, A. H.; University of Stellenbosch. Faculty of Law. Dept. of Mercantile Law.
The worldwide increase of corporate failures on the scale of Enron and WorldCom has sparked a renewed international trend of corporate governance review. With the external company auditor blamed at least in part for many corporate failures, corporate governance reform also necessitates a review of the statutory regulation of the company auditor. In particular, the lack of auditor independence when auditing clients has been under the legislator’s spotlight. The problems associated with unregulated or poorly regulated auditors are well illustrated by the activities of auditing giant Arthur Andersen. In the US, the Sarbanes-Oxley Act has been promulgated in reaction to corporate failures, imposing many new legislative restrictions on the auditor. The UK has a more tempered, selfregulatory approach. South Africa, following international trends with its recently promulgated Auditing Profession Act and Corporate Laws Amendment Act, has also greatly increased the regulation of auditor independence. The question is now whether these new restrictions in the wake of corporate failures have been the right approach with which to prevent future failures and to provide adequate protection to shareholders. Although the general legislative increase in auditor awareness is welcomed, the efficacy of several provisions in South African legislation can be questioned. Widespread reform has taken place in the appointment and remuneration of the auditor, which now has to be independently determined by the audit committee. In particular, South Africa’s new regulation of non-audit services, and the lack of refined regulation on compulsory auditor rotation as well as the cross-employment of auditors by clients, needs a critical discussion. It is submitted that the discretion of a well-regulated audit committee, combined with increased disclosure and transparency, should be enough to regulate most of the key aspects of auditor independence. Care should be taken to not overlegislate in haste to reform. South Africa needs a flexible and customised approach in this regard.
The legal risks associated with trading in derivatives in a merchant bank
(Stellenbosch : University of Stellenbosch, 2006-03) Terblanche, Janet Rene; Sutherland, Philip; Van der Bijl, C.; University of Stellenbosch. Faculty of Law. Dept. of Mercantile Law.
The research defines derivatives as private contracts, with future rights and obligations imposed on all parties, used to hedge or transfer risk, which derives value from an underlying asset price or index, which asset price or index may take on various forms. The nature of derivatives is that the instruments are intended to be risk management tools. The objectives of derivatives are either to hedge a risk, or to speculate. Derivatives may be classified by the manner in which they are traded, either over the counter (OTC) or on exchange. Alternatively, derivatives may be classified on the basis of structure and mechanisms, i.e. forwards, futures, options or swaps. Risk and risk management are defined in the third chapter with the focus on merchant banking. The nature of risk is that it is inherent in all activities. The nature of risk management is that it aims to ensure that the risks faced by the merchant bank are managed on a daily basis. The objective of risk management is to ensure that losses are minimised and the appropriate level of risk is taken in order to maximise profits. Risk may be classified as operational, operations, market, systemic, credit and legal risk. A comprehensive discussion of credit risk is presented, as it pertains to the legal risk in derivatives in a merchant bank. This includes insolvency, set-off, netting, credit derivatives and collateral. Legal risk is defined as the risk of loss primarily caused by legal unenforceability (i.e. a defective transaction, for instance a contract), legal liability (i.e. a claim) or failure to take legal steps to protect assets (e.g. intellectual property). The nature of legal risk is that it is caused by jurisdictional and other cross-border factors, inadequate documentation, the behaviour of financial institutions, a lack of internal controls, financial innovation or the inherent uncertainty of the law. The objectives of legal risk management in derivatives are to avoid the direct and indirect costs associated with legal risk materialising. This includes reputational damage. Derivatives attract specific legal risks due to the complexity of the instruments as well as the constant innovation in the market. There remains some legal uncertainty regarding derivatives in terms of gaming, wagering and gambling, as well as insurance. The relationship between risk and derivatives is that due to the complexity and constant innovation associated with derivatives, there are some inherent risks to trading in derivatives. It is therefore important to ensure that there is a vested risk management culture in the derivatives trading environment. Chapter four gives an overview of derivatives legislation in foreign jurisdictions and in South Africa. The contractual and documentation issues are discussed with reference to ad hoc agreements, master agreements and ISDA agreements. The practical implementation issues of master agreements and ad hoc agreements are also discussed. The recommendations are that legal risk management be approached in a similar manner to credit, market and other risk disciplines. A legal risk management policy needs to be developed and implemented. The second recommendation is that a derivative to manage the legal risk in derivatives be developed.
The meaning of public purpose and public interest in Section 25 of the Constitution
(Stellenbosch : University of Stellenbosch, 2009-12) Nginase, Xolisa Human; Van der Walt, A. J.; University of Stellenbosch. Faculty of Law. Dept. of Mercantile Law.
ENGLISH ABSTRACT: This thesis discusses the meaning of public purpose and public interest in s 25 of the Final Constitution. The main question that is asked is: how does ‘public purpose’ differ from ‘public interest’, and what impact did the Final Constitution have on the interpretation and application of the public purpose requirement in expropriation law in South Africa? This question is investigated by looking at how the courts have dealt with the public purpose requirement, both before and during the first years of the constitutional era in South African law, and also with reference to foreign law. The thesis shows that the position has not changed that much yet because the interpretation of this requirement has not received much attention in constitutional case law. The main focus is to show that the reason for the interpretation problems surrounding this requirement is the apparent conflict between the formulation of the public purpose requirement in the Final Constitution and in the current Expropriation Act of 1975. It is pointed out that the efforts that were made to resolve the problem failed because the Expropriation Bill 2008 was withdrawn. Consequently, it is still unclear how the public purpose requirement has been changed by s 25(2) of the Constitution, which authorises expropriation for a public purpose or in the public interest. This apparent lack of clarity is discussed and analysed with specific reference to the different types of third party transfers that are possible in expropriation law. Comparative case law from Australia, Germany, the United Kingdom, the United States of America and the European Convention on Human Rights is considered to show how other jurisdictions deal with the public purpose requirement in their own constitutions or expropriation legislation, with particular emphasis on how they solve problems surrounding third party transfers. In the final chapter it is proposed that the Expropriation Bill should be reintroduced to bring the formulation of the public purpose requirement in the Act in line with s 25(2) and that expropriation for transfer to third parties could be in order if it serves a legitimate public purpose or the public interest (e g because the third party provides a public utility or for land reform), but that expropriation for economic development should be reviewed strictly to ensure that it serves a more direct and clear public interest than just stimulating the economy or creating jobs.

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