One of the major changes that is proposed to be introduced in the Companies Bill, is the introduction of “Business Rescue”, in terms of Chapter 6, modeled on the US Chapter 11 insolvency provisions.
What this will allow, once it is passed into law, is that businesses in financial difficulties or under threat of liquidation can apply (or other interested parties such as employees or creditors) to court to have such a company placed under a business rescue plan.
These business rescue proceedings will give the company a moratorium against legal action …

Business Report:
“Consumer credit insurance in South Africa has a bad name and is seen by many as a scam or a rip-off, Judge Peet Nienaber noted in a report on an inquiry into the industry.
However, not all the reasons for this were necessarily valid, and it was always necessary to distinguish between different insurers and different insurance products, he continued.
While the industry fulfilled a definite need, its potential deficiencies lent themselves to the exploitation of consumers by practitioners more intent on profit than service, the inquiry found in its final …

“There is no contest between the company that buys the grudging compliance of its work force and the company that enjoys the enterprising participation of its employees.”
Ricardo Semler

Business Report’s Quentin Wray:

Borrowers are in trouble but lenders are staying away from the courts in their efforts to recover bad debts, data released by Statistics SA yesterday shows.
From December to February, the number of summonses for debts fell 11.3 percent while the number of judgments dropped 10.3 percent. The value of debts for which judgments were granted fell 2.4 percent.
According to Stats SA, there were 60 920 civil judgments for debt in February worth R560.7 million. The largest portion of this was judgments relating to money lent and …

 
I had a call from a creditor today with a debt of over a hundred thousand rand from a company which has apparently just made an application to go into liquidation. I was asked the inevitable question of whether we could hold the directors personally liable and what they could do to recover the debt.

I won’t burden you in dealing with the difficulties of obtaining the personal liability of a director here, but it suffices to say that this, in most cases, is grabbing at straws unless you have a …

Business Report :
“Figures released by the South African Reserve Bank on Wednesday showed that private borrowing growth had decreased as local consumers tightened their belts.
Growth in demand for credit by the country’s private sector (PSCE) slowed to 20.79 percent year-on-year in February from a revised 23.06 percent in January, the SA Reserve Bank said.
For the same period, the broadly defined M3 measure of money supply growth also slowed to 21.07 percent, compared to a revised 25.24 percent in January.
According to an I-Net Bridge poll, the rate of growth in PSCE …