Assessing the Legal and Regulatory Framework for Special Economic Zones in South Africa

by | Nov 19, 2022 | SAMLJ, SAMLJ V34 I2

Assessing the Legal and Regulatory Framework for Special Economic Zones in South Africa

Author: Mmiselo Freedom Qumba

ISSN: 1996-2185
Affiliations: Lecturer, Department of Mercantile Law, University of the Free State
Source: South African Mercantile Law Journal, Volume 34 Issue 2, 2021, p. 229 – 267
https://doi.org/10.47348/SAMLJ/v34/i2a4

Abstract

The previous industrial development zones (IDZs) programme did not generate the anticipated economic growth in South Africa. Thus, the recent special economic zones (SEZs) programme is aimed at addressing the deficiencies in the disappointing record of the IDZs. So, would the new SEZ programme succeed if the IDZs failed? Since the IDZ is considered to have failed to generate the expected levels of economic growth, it is important assess whether the new SEZ programme will be able to fulfil its intended objectives. Therefore, the purpose of this article is to provide an insightful analysis of the South African SEZ programme from a legal and policy perspective and to proffer some reforms in areas that may be pertinent for the success of the SEZ programme. It traces South Africa’s experience with the IDZs and related industrial policies by assessing how the country has fared so far, looking at its transition from the IDZs to the SEZs and analyses the potential challenges it is likely to face in the future. It adopts a comparative method of analysis by examining key issues confronting SEZs in South Africa, India, and China. In particular, the article compares only the key aspects in the regulatory design of the SEZ as found in the SEZ Act. These aspects include: the governance and ownership structure of the SEZs; the incentives offered to investors; the establishment of one-stop shops and issues of infrastructure development.

South African Governance Legal Framework for Corporate disclosures and reporting: Part 1 – Voluntary sustainability reporting

by | Nov 19, 2022 | SAMLJ, SAMLJ V34 I2

South African Governance Legal Framework for Corporate disclosures and reporting: Part 1 – Voluntary sustainability reporting

Author: Werner Schoeman

ISSN: 1996-2185
Affiliations: Lecturer: Mercantile and Labour Law Department, School of Law, University of Limpopo
Source: South African Mercantile Law Journal, Volume 34 Issue 2, 2021, p. 268 – 292
https://doi.org/10.47348/SAMLJ/v34/i2a5

Abstract

The general dissatisfaction of shareholders and other users of financial statements with both voluntary sustainability and mandatory financial disclosure and reporting, prompt an appeal for increased government-commanded reporting requirements. State-based standardsetting and voluntary sustainability reporting within the corporate jurisprudence must therefore evolve, which includes, among others, the variety of legal and regulatory standards, their dynamism, and the manner in which standards can be imposed. Directors and auditors must act ethically to observe their various functions as regulated by the Companies Act 71 of 2008 and the Auditing Profession Act 26 of 2005. National and international companies persistently undermine good governance. Directors’ and auditors’ failure to comply with ethics can certainly not continue with impunity. The global trend in the use of voluntary sustainability reporting highlights the prominence that auditors play in good corporate governance, although compliance with voluntary sustainability reporting does not warrant good corporate governance. Independence of auditors remains contentious in the light of the funding model of the regulator, working of audit committees, the connection between directors and companies, and the corporate governance expectation gap.

Case Notes: The income tax position of a creditor on the insolvency and/or business rescue of a debtor

by | Nov 19, 2022 | SAMLJ, SAMLJ V34 I2

Case Notes: The income tax position of a creditor on the insolvency and/or business rescue of a debtor

Authors: Thabo Legwaila & Carika Fritz

ISSN: 1996-2185
Affiliations: Professor of Law, University of Johannesburg; Associate Professor of Law, University of the Witwatersrand
Source: South African Mercantile Law Journal, Volume 34 Issue 2, 2021, p. 293 – 303
https://doi.org/10.47348/SAMLJ/v34/i2a6

Abstract

None

Reinstatement in the Context of ‘Deemed Dismissal’: A Critical Analysis of Recent Case Law

by | Oct 23, 2022 | SAMLJ, SAMLJ V34 I1

Reinstatement in the Context of ‘Deemed Dismissal’: A Critical Analysis of Recent Case Law

Authors: Chuks Okpaluba & Mpfariseni Budeli-Nemakonde

ISSN: 1996-2185
Affiliations: Research Fellow, Centre for Human Rights, University of the Free State, South Africa; Professor of Labour Law, School of Law, College of Law, UNISA
Source: South African Mercantile Law Journal, Volume 34 Issue 1, 2021, p. 1 – 28
https://doi.org/10.47348/SAMLJ/v34/i1a1

Abstract

The ‘deemed dismissal’ or ‘discharge’ clause is not mentioned either in the reinstatement provisions of section 193 of the Labour Relations Act 66 of 1995 (‘LRA’), or indeed, in any other provision of that Act. Such an expression can be traced to several public sector employment statutes such as: section 14(1)(a) of the Employment of Educators Act 76 of 1998; section 59(3) of the Defence Act 42 of 2002; and section 17(3)(a)(i) and (b) of the Public Service Act 103 of 1994 (‘PSA’). Notwithstanding that the substance and process of the ‘deemed dismissal’ disputes are quite different from those encountered in the law of unfair dismissal under the LRA, the determination whether reinstatement would be made in such a circumstance has been guided by the provisions of section 193(2)(a)–(d) of the LRA. After discussing the important South African cases of Phenithi v Minister of Education 2008 (1) SA 420 (SCA); Minister of Defence and Military Veterans v Mamasedi 2018 (2) SA 305 (SCA); and Ramonetha v Department of Roads and Transport, Limpopo [2018] 1 BLLR 16 (LAC), and those from the Botswana and Namibian jurisdictions, it becomes obvious that the Ramonetha case was quite different from the others. The conclusion, therefore, is that the judgment of the Labour Appeal Court sends a clear message to the employer that the statutory discretion invested in it by the PSA requires it to act within a space of time; the PSA does not give the employer the unbridled power to literally approbate and reprobate at the same time.

Good Faith is not Dead: It still Lives after Beadica 231 CC v Trustees, Oregon Trust

by | Oct 23, 2022 | SAMLJ, SAMLJ V34 I1

Good Faith is not Dead: It still Lives after Beadica 231 CC v Trustees, Oregon Trust

Author: Michele van Eck

ISSN: 1996-2185
Affiliations: Senior Lecturer, Department of Private Law, University of Johannesburg
Source: South African Mercantile Law Journal, Volume 34 Issue 1, 2021, p. 29 – 51
https://doi.org/10.47348/SAMLJ/v34/i1a2

Abstract

In Beadica 231 CC v Trustees, Oregon Trust, the Constitutional Court provided much-needed clarity on the role of equity principles (fairness, reasonableness and good faith) in contracts, in that the abstract principles found in equity principles will not apply directly to contractual engagements but will apply indirectly by means of public policy considerations. This article illustrates that this default position, as articulated by the Constitutional Court, does not completely exclude good faith in contractual engagements. In fact, good faith is infused in the entire contract lifecycle, starting from negotiation and presenting itself even in certain remedial action. In addition, there are a number of exceptions to the default position in that equity principles can be established by means of express incidentalia (in the form of good faith clauses), and could even be imported ex lege in consumer contracts by means of the Consumer Protection Act 68 of 2008. It can therefore be said that the operation of equity principles, such as good faith, in South African contractual engagements is neither dead nor obsolete. Rather, good faith has survived the Constitutional Court’s decision and continues to manifest itself in different ways in contracts reaffirming the place of good faith as a cornerstone principle in the operation of the law of contract.

Re-Acquisition by a Company of Own Issued Shares under Sections 48 and 114(1) of the Companies Act 71 of 2008: A Critical Assessment through Capprec

by | Oct 23, 2022 | SAMLJ, SAMLJ V34 I1

Re-Acquisition by a Company of Own Issued Shares under Sections 48 and 114(1) of the Companies Act 71 of 2008: A Critical Assessment through Capprec

Author: Simphiwe S. Bidie

ISSN: 1996-2185
Affiliations: Senior Lecturer, Nelson R. Mandela School of Law, University of Fort Hare
Source: South African Mercantile Law Journal, Volume 34 Issue 1, 2021, p. 52 – 87
https://doi.org/10.47348/SAMLJ/v34/i1a3

Abstract

Since the Companies Act 2008 came into being, there has been no clear direction regarding the interpretation to be given to the provisions regulating buy-back transactions. Recently, the provisions finally received some concrete attention in the judgment of Windell J in First National Nominees (Pty) Limited v Capital Appreciation Limited (Capprec). The judgment is important because it has since provided a measure of clarity on the potent interdependence between sections 48 and 114 of the 2008 Act, and how these must be interpreted. What is of interest is how Windell J set out and interpreted the operation and interdependence between section 48(2)(a), section 48(8)(b) and section 114 of the 2008 Act. Overall, the arguments from both parties in Capprec presented Windell J with a solid foundation that enabled the court to proffer a succinct and illuminating direction on the interpretation and operation of the provisions. This article attempts to extricate whether the course Windell J adopted in her judgment is consistent with what the 2008 Act contemplates, and if not, what would have been the appropriate course to take. The article demonstrates that Windell J did not seize the opportunity to thoroughly engage with section 114(1)(e) regulating buy-back schemes of arrangement and to ascertain what a scheme entails. This is despite the fact that in Capprec both parties’ arguments were underpinned by whether or not the proposed arrangement was a scheme. In this regard, Windell J’s approach is disappointing and is criticised because her interpretation means that the provisions of the 2008 Act have still not been clarified, although we have been waiting for 13 years for clarification. This is an unnecessary oversight by the judge.