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 for the enforcement of outstanding debts while a business plan for the company’s rescue is proposed and if approved put into action. Such a plan would involve such mechanisms as the restructuring of debt repayments and possibly the selling off of company assets. This whole business rescue process will be overseen by an approved “Supervisor”.

The motivation and philosophy behind the proposed legislation being that it if it is possible, it is better to rescue a business then to put it into liquidation.

However this whole business rescue process will have serious implications for creditors, and in particular creditors who have securities.

Bentley Credit Control’s seminar looking at this business rescue process and its implications on creditors ( as well as covering commercial fraud prevention), has been moved from the 23rd April 2008 to the 19th May 2008 and will be held in Durban.

So should you wish to be properly informed on this business rescue and its implications for creditors, we encourage you to attend this seminar.