South African businesses need to review contracts that use interbank offering rates (IBORs), to ensure that these rates are replaced with the new benchmarks by end-December 2021.
On 15 October 2021, in Commissioner for the South African Revenue Service v Spur Group (Pty) Ltd (Case no 320/20)  ZASCA 145 (15 October 2021), the Supreme Court of Appeal (SCA) handed down judgment on whether a capital contribution made by an employer to a trust established for purposes of an employee share incentive scheme was deductible for income tax purposes. The SCA also determined whether prescription applied in the circumstances. This article discusses the case and the impact of its findings on share incentive schemes in South Africa.
Recently, 11.9 million financial records known as the Pandora Papers were leaked, revealing the offshore financial assets of many internationally well-known persons. One of the questions raised is whether the investments made by these persons are legal from a tax perspective.
In certain circumstances, a regulated intermediary is the only person who can claim a dividends withholding tax (DWT) refund from the South African Revenue Service (SARS) on behalf of the company or other entity to which the DWT relates. The regulated intermediary is, however, reliant on the correct, requisite information and documentation being timeously provided by the company concerned or, as is often the case, the company's DWT collection agent. As refunds can only be reclaimed for a period of three years after the declaration of the relevant dividend, this poses a potential prescription risk for the company concerned and the beneficial holder.
According to this fascinating area of history, banking originated in Babylon around 3000 BC. It may not have been quite as we know it today, but safety and security concerns were as much a part of banking then as they are now. Temples and palaces were the safe houses used to store the means of financial transactions. Grain found most favour in the countryside, while silver was preferred in the city. Cowrie shells were used as a form of money by 1200 BC, and gold coins began to circulate from approximately 560 BC. What would these ancient civilisations make of today's currencies – particularly bitcoin?
September 11 2021 marked the 20th anniversary of the terrorist attack on the World Trade Centre in New York, and the Pentagon in Washington, D.C. This callous event was unprecedented and shook the world to its core. Apart from the catastrophic loss of life and property, the unintended consequences were evident across the world, including tighter domestic and international security, focused intelligence initiatives, scrutiny of global financial transactions and activity, and a deluge of regulatory enforcements aimed at sustaining efforts to detect and prevent a reoccurrence, not only in the West, but anywhere in the world. The US embarked on its war against terror and initiated one of its longest and most expensive (and controversial) military campaigns.
African funds can attract more global investors by adopting ESG strategies which will benefit the continent, but they will need to comply with strict requirements on reporting and transparency.
More than a year has passed since the Constitutional Court (ConCourt) weighed in on a matter of cardinal importance to business certainty in South Africa: the question of whether a court can invalidate a commercial contract on public policy grounds (Beadica 231 CC and Others v Trustees for the time being of the Oregon Trust and Others (CCT109/19)  ZACC 13; 2020 (5) SA 247 (CC); 2020 (9) BCLR 1098 (CC) (17 June 2020).
In an ultra-competitive, globalised corporate landscape, companies are constantly on the lookout for ways to attract investors and promote their brand. While factors such as share price growth and dividend yield remain key in decision-making by investors, non-financial factors, including environmental, social and governance (ESG) compliance, sustainability and company-stakeholder engagement have, in recent years, risen in prominence and play an ever-greater role.
Section 164 is a statutory mechanism designed to provide a dissenting shareholder with a remedy to exit a company after the majority of shareholders resolve to pursue a transaction at odds with the dissenting shareholder. The provision prescribes an onerous process which ultimately allows the objecting dissenting shareholder to demand that the company pay them the fair value for all their shares.
The introduction of Chapter 6 of the Companies Act (71 of 2008) brought with it a shift from a creditor-protectionist society towards a business rescue model that is debtor-protectionist. In consequence, there have been a multitude of applications over the past 13 years, which showcase the blatant exploitation of the business rescue scheme.
The Constitutional Court (CC) recently handed down a landmark judgment pertaining to the jurisdiction of the Competition Tribunal and Competition Appeal Court (CAC). The CC's judgment focused on whether the CAC was, in law, correct in interfering with the Tribunal's finding to prohibit a merger in the private health care services sector.
Special Purpose Acquisition Companies (SPACs) – publicly trading shell companies with the mandate to acquire or merge with other companies or acquire assets – have reshaped traditional capital markets. In 2020, funds raised by SPACs reached an all-time high of US$82.6 billion. According to Dealogic, by the second quarter of 2021, 2020's record was already surpassed – with 350 SPACs raising US$107.6 billion.