Browsing by Author "Jooste, Richard"

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    A critique of the insider trading provisions of the 2004 Securities Services Act
    (2006) Jooste, Richard
    Various attempts have been made over the years by the legislature to combat insider trading and related activities. The Securities Services Act of 2004, which repeals the Insider Trading Act of 1998 and now regulates insider trading, has made significant changes to the law in this regard. However, this contribution argues that the law remains flawed in a number of respects and that certain innovations, such as the extension of the ambit of liability to cover body corporates, partnerships and trusts have been introduced without sufficient elaboration. The article seeks to analyse the new provisions and to highlight their failings.
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    A warning to everyone who deals with a trust
    (2005) Jooste, Richard
    The recent case of Nieuwoudt & another NNO v Vrystaat Mielies (Edms) Bpk 2004 (3) SA 486 (SCA) has raised questions regarding the applicabilityof the doctrine of constructive notice and the so-called Turquand rule to trusts. The doctrine of constructive notice and the Turquand rule form part of the common law governing companies.
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    An analysis of the methods used in the South African domestic legislation and in double taxation treaties entered into by South Africa for the elimination of international double taxation
    (2013) Gutuza, Tracy; Jooste, Richard; Horak, Wally
    This thesis adds to the body of literature exploring the policy principles of equity and neutrality, as applied in the context of methods relieving international double taxation and in the context of a recently opened and developing economy.
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    Can share capital be reduced other than by way of a buy-back?
    (2005) Jooste, Richard
    The amendments made to the Companies Act 61 of 1973 (hereafter referred to as ‘the Act’) by the Companies Amendment Act 37 of 1999 made far-reaching changes affecting the share capital of a company. A significant change was the removal of ss 83–90 of the Act, which required a special resolution and, except in limited circumstances, a court’s sanction in order for a company to reduce its share capital.
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    Can share capital be reduced other than by way of a buy-back?
    (2005) Jooste, Richard
    The amendments made to the Companies Act 61 of 1973 (hereafter referred to as ‘the Act’) by the Companies Amendment Act 37 of 1999 made far-reaching changes affecting the share capital of a company. A significant change was the removal of ss 83–90 of the Act, which required a special resolution and, except in limited circumstances, a court’s sanction in order for a company to reduce its share capital.
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    Causation and the concomitant issue of apportionment with reference to gross income in South African income- tax law
    (Juta Law, 1989) Emslie, Trevor; Jooste, Richard
    The objective of this article is twofold: first, to set out the correct role, in our view, of the notion of causation in the application of two elements of the definition of gross income-the characterization of an amount as being from a source within the Republic (or not) and as being of a capital nature (or not); and secondly, to ascertain the apportionment implications where two or more causae with differing tax consequences are found to have given rise to the receipt or accrual of a single amount.
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    The civil liability of credit rating agencies in South African law: recent developments in comparative perspective
    (2013) Thompson, Simon; Jooste, Richard
    The losses caused by the on-going financial crisis now exceed $4 trillion. This is in addition to the associated social and economic costs that are more difficult to measure. From a litigator’s perspective it is not surprising that these massive losses have triggered a very large number of civil claims. In the immediate aftermath of the crisis these claims were mostly run-of-the-mill misrepresentation actions by investors against their investment advisors, but there is now a clear, global trend where plaintiffs are casting their nets more widely and going after the financial actors allegedly responsible for the crisis itself. One class of defendants who fit squarely in this category are credit rating agencies. These financial actors are facing a global push by lawmakers to regulate their operations with, inter alia, the express aim of setting parameters for the liability ratings agencies should incur in the publication of ratings.
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    Corporate capacity and authority of agents under the Botswana Companies Act 2003
    (2014) Baiketlile, Lindani; Jooste, Richard
    The purpose of this paper is to examine the way in which the capacity of the company is to be determined and also how the law has been changed with regard to when the company acts beyond its capacity and where directors or other agents acts beyond their authority. Corporate capacity herein refers to the ability of a company to enter into a particular transaction with a third party and Authority on the other hand will refer to acts by individuals who purport to take decisions on behalf of the company. The effectiveness of the Act in addressing the capability of the company to contract will be critically analysed and so are the protections offered to shareholders, the company and in equal measure third parties dealing with the company. The paper will particularly analyse the two fundamental doctrines/rules relating to corporate capacity, namely the ultra vires doctrine and constructive notice. The Turquand rule, agency principles and constructive notice will be discussed in so far as they relate to authority of agents. A comparative analysis of the provisions of the Act on capacity and authority will be undertaken with reference to the South African Companies Act of 2008. The comparison is meant to assess the competitiveness and harmonization of the Act with those of other countries particularly in the SADC region, to foster regional Integration.
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    The effective and proper exercise of appraisal rights under the South African Companies Act, 2008 : developing a strategic approach through a study of comparable foreign law
    (2016) Yeats, Jacqueline; Jooste, Richard
    This thesis seeks to identify how the appraisal rights remedy, which was introduced into South African company law for the first time by section 164 of the Companies Act 71 of 2008 ('the South African Act'), should be interpreted and applied in order to facilitate its effective and proper exercise. When the draft version of the South African Act was initially published for public comment, critics raised concerns that the inclusion of the appraisal remedy was undesirable and unnecessary. These concerns were largely motivated by the fact that at the time appraisal rights were a novel concept and thus a completely unknown quantity in South African law. As a result there was much uncertainty in the legal and commercial sector as to how these rights would be interpreted, how they would function and how frequently they would be used. However, since the commencement date of the South African Act (being 1 May 2011) to date no appraisal rights matter has come before our courts and it could therefore be argued that the initial concerns of the critics regarding the impact that the inclusion of appraisal rights would have on South African company law were unfounded. This 'lack of use' phenomenon is in line with the general trend experienced in foreign jurisdictions where the appraisal remedy has been on the statute books for decades, such as the United States of America ('USA' or 'US'), Canada and New Zealand. Due to the fact that appraisal rights are notoriously underutilised they have often been dismissed as an ineffective remedy for minority shareholders. Clearly it could not have been the intention of the drafters of the South African Act to include an ineffective or useless remedy. My research indicates that the lack of use of the appraisal remedy in comparable jurisdictions is due to a number of factors but can be broadly attributed to the complexity, uncertainty and expense associated with the exercise of appraisal rights. The thesis therefore seeks to identify the various causes of the lack of effectiveness apparent in the USA, Canada and New Zealand, to examine the relevance of these in the South African context and to consider possible ways of addressing these challenges. The ultimate objective of the thesis is to devise measures which may be taken so that the appraisal remedy can function more effectively, or at least as effectively as possible, in South Africa.
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    Financial Assistance - A new approach
    (2009) Yeats, Jacqueline; Jooste, Richard
    The Companies Act 71 of 2008 introduces a new s 44 which deals with financial assistance by a company for the acquisition of its shares and which will replace s 38 of the current Companies Act 61 of 1973 when the new Act comes into operation. The focus of the legislation has shifted from the prohibition to the regulation of financial assistance in this context, and the article subjects the new section to comparative and contextual analysis, seeks to interpret the specific provisions and highlights possible areas which may prove to be problematic or confusing.
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    Financial assistance to directors - the Companies Act 71 of 2008
    (Juta Law, 2010) Jooste, Richard
    Transactions between a company and its directors, which benefit the company at the company’s actual or potential expense, are to an extent regulated by ss 37, 226 and 297 of the current Companies Act 61 of 1973. These provisions are flawed and this article examines the corresponding (but by no means equivalent) provisions of the new Companies Act 71 of 2008, which is expected to be brought into force in 2010. The article seeks to show that the new provisions are also unsatisfactory. It reveals that the provisions are in certain respects too far-ranging and that, in others, treat directors too leniently. The article also exposes problems of interpretation which impact significantly on the effectiveness of the new provisions. The article demonstrates that the provisions need legislative attention.
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    Financial assistance: the new approach
    (2009) Pinnock, Steven; Jooste, Richard
    Several jurisdictions, including South Africa, regulate the granting by a company of financial assistance for the acquisition of its own shares. Some permit financial assistance unconditionally, others regulate financial assistance according to strict conditions and others prohibit it subject to minor exceptions. After statutorily being introduced into company legislation in the early part of the 20th Century, there are still questions as to why this law is still so prominent, and whether such regulation or prohibition is a necessary component of company law in the modern commercial environment, or more specifically the South African commercial environment where the prohibition has been an impediment to Black Economic Empowerment (BEE) deals. The prohibition against financial assistance has been criticised by numerous academics and practitioners, and many jurisdictions have over time amended their laws dealing with financial assistance to make it less burdensome and restrictive. 1 South Africa finally relaxed its financial assistance prohibition contained in section 38 of the Companies Act- in 2007 when the Corporate Laws Amendment Act3 came into operation with the introduction of the US modelled solvency and liquidity test.
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    Financial assistance: the new approach
    (2009) Pinnock, Steven; Jooste, Richard
    Several jurisdictions, including South Africa, regulate the granting by a company of financial assistance for the acquisition of its own shares. Some permit financial assistance unconditionally, others regulate financial assistance according to strict conditions and others prohibit it subject to minor exceptions. After statutorily being introduced into company legislation in the early part of the 20th Century, there are still questions as to why this law is still so prominent, and whether such regulation or prohibition is a necessary component of company law in the modern commercial environment, or more specifically the South African commercial environment where the prohibition has been an impediment to Black Economic Empowerment (BEE) deals. The prohibition against financial assistance has been criticised by numerous academics and practitioners, and many jurisdictions have over time amended their laws dealing with financial assistance to make it less burdensome and restrictive.1 South Africa finally relaxed its financial assistance prohibition contained in section 38 of the Companies Acf- in 2007 when the Corporate Laws Amendment Act3 came into operation with the introduction of the US modelled solvency and liquidity test.
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    'Increase of share capital of public companies under German and South African law: a comparative law study.'
    (2011) Engelkamp, Holger; Jooste, Richard
    The German Aktiengesetz (Engl.: Stock Corporation Act) of 6 September 1965 (hereinafter: the Aktiengesetz) and the South African Companies Act, 43 of 1973 (hereinafter: the 1973 Act) provide, or rather provided for a similar approach with respect to the increase of share capital of public companies I through the issuance of shares: Both the Aktiengesetz (see§ 182 Aktiengesetz2 ) and the 1973 Act (see s 221 of the 1973 Act) basically required an approval of the shareholders, which had to immediately precede the issuance of new shares.
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    'Insider trading regulation': to be or not to be?
    (2010) Adetoun, Adedurotiivii Omowunmi; Jooste, Richard
    Insider trading may be defined as the act of trading in company securities by persons often referred to as insiders who by virtue of their relationship to the company, possess some information, not available to the public, but material to the securities concerned. For instance, insider trading occurs where a director knows that a company is in a bad financial state and sells his shares in it knowing that in a few days, a cut in the dividend payment will be made public. Likewise, the director will be an insider trader if on being informed before it was generally made public that the company has discovered oil on its own land, he buys more shares in the company with the hope of an increase in their market value as soon as the information is made public. There are two schools of thought with strong and divergent views on the effect of insider trading generally and particularly as it affects the stock market and the investing public. The proponents of the first school of thought encourage trading on insider information for its many advantages. According to them, the stock market generally feeds and grows on free flow of information. Disallowing insider trading would mean hampering the flow of trade. Furthermore, they have argued that insider trading is fundamental to capitalism because it pushes prices in the right direction, increases the number of transactions and provides the only real recompense for entrepreneurs. In addition, they are of the opinion that long-term investors stand a chance to benefit immensely from the act.
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    Insider trading regulation: to be or not to be?
    (2009) Adetoun, Adedurotiivii Omowunmi; Jooste, Richard
    Insider trading1 may be defined as the act of trading in company securities by persons often referred to as insiders who by virtue of their relationship to the company, possess some information, not available to the public, but material to the securities concerned. For instance, insider trading occurs where a director knows that a company is in a bad financial state and sells his shares in it knowing that in a few days, a cut in the dividend payment will be made public. Likewise, the director will be an insider trader if on being informed before it was generally made public that the company has discovered oil on its own land, he buys more shares in the company with the hope of an increase in their market value as soon as the information is made public.
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    Is the corporate governance law applicable to Zambian banks and financial institutions adequately promoting good corporate governance?
    (2014) Sikazwe, Chanza Kephas; Jooste, Richard
    Good corporate governance has been hailed as an important factor for the growth of sustainable economic development by enhancing the development of companies and increasing their access to outside capital. Furthermore, for emerging markets like Zambia, improving corporate governance can serve a number of important public policy objectives. Good corporate governance reduces emerging markets vulnerability to financial crisis, reinforces property rights, reduces transaction costs and the cost of capital and leads to capital market development. Since Banks are primarily companies, they also fall within the preserve of corporate governance.
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    Issues relating to the regulation of 'Distributions' by the 2008 Companies Act
    (2009) Jooste, Richard
    The distribution by a company of its assets to its shareholders, whether they be in the form of cash or otherwise, ought to be carefully regulated by any legal system intent on protecting the interests of creditors and minority shareholders of the company. Until 1999 such protection was largely provided for by the maintenance of capital principle. This principle manifested itself in various ways, the most significant being that it was unlawful for a company to acquire its own shares or shares in its holding company, and the distribution of funds to shareholders other than those representing legally distributable profits usually required a court order. In 1999 this all changed with far-reaching amendments to the Companies Act 61 of 1973 (see the Companies Amendment Act 37 of 1999). The maintenance of capital principle was effectively abolished; companies were permitted to acquire their own shares and shares in their holding companies; and the distinction between profits and other funds of a company was removed. The distribution of funds entailed was allowed provided, inter alia, the company's solvency and liquidity was not placed in jeopardy and, in the case of a buy-back or a purchase of shares in the holding company, a special resolution had been adopted to approve the transaction.
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    The maintenance of capital and Companies Bill 2007
    (Juta Law, 2007) Jooste, Richard
    The Companies Amendment Act 37 of 1999 brought about a significant mind-shift in relation to the concept of the maintenance of capital of a company. Prior to this Act, in an attempt to protect shareholders and minority shareholders, an extremely tight rein was kept on the ability of a company to part with its capital other than in the course of its business operations. Before the Amendment Act came into force this meant that, generally, a company could not acquire its own shares, a subsidiary could not acquire shares in its holding company, and dividends could not be paid out of capital. As a result of the 1999 Amendment Act all these transactions are now allowed subject to the basic requirement that the solvency and liability of the company must not be affected (see ss 85, 89 and 90 of the Companies Act 61 of 1973).
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