May 2007


From My Window - May 2007 From My Window May 2007

I have harboured doubts about the Asset Forfeiture Unit and the manner in which it goes about its business ever since it was first established. Nor have I hidden my disquiet. On the contrary, I have written critically about its activities on any number of occasions.

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From My Window - June 2007 From My Window May 2007

India's march to super economic giant status is attracting increasing attention. Some years ago, when it was still making profits and flying high, SwissAir shifted its accounting centre out of Zurich in favour of Bombay (Mumbai). India's reputation as a favoured Information Technology centre is beyond dispute – Accenture has shifted its largest centre out of the USA to the subcontinent.

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From the mouths of women Letters May 2007


Sir

I would have been happy to accept your comment on 'women and stress' and to resist engaging in a debate on the subject. However, Deneys Reitz's strangely offensive response cannot go unanswered. I absolutely reject the accusation that my article was “deliberately offensive to readers of without prejudice." I do, of course, sincerely regret any offence it has inadvertently caused.

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Everything you need to know about tax audits and their consequences Tax May 2007

These days only a very small proportion of correspondence arrives by courtesy of the Post Office – most of the important mail arrives electronically. But I imagine that, of everything conveyed by the snail mail, one of the least happy mail-opening experiences of a financial director is when a letter arrives from the SARS. And it gets even worse when the opened envelope reveals a ten-page list of queries.

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The little matter of royalties – one view from the recent BP case… Tax May 2007

The recent judgement handed down by the Appeal Court in the matter of BP (Southern Africa) (Pty) Ltd v C:SARS ([2007] SCA 7 (RSA)) will come as welcome relief to tax advisers and businessmen alike. The judgement overturned the earlier decision of the Cape Tax Court in the same matter, which had held that an annual royalty paid by BP SA to its UK parent company for the use of the parent's trademarks and marketing get-up, was of a capital nature and therefore not tax deductible.

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...and here’s another Tax May 2007

Is the Appeal Court judgement in the BP case the last word on the nature of royalty payments? In my opinion, it is not. The judgement merely applies long-standing principles of capital/revenue expenditure to the facts of that case, facts previously misconstrued by the lower Tax Court.


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Relief in sight for BEE transactions Tax May 2007

The tax cost of black economic empowerment (BEE) transactions has been the subject of debate between business and government for a number of years.

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What are the options with share options? Tax May 2007

Amended provisions concerning the taxation of share schemes have been introduced, completely replacing the previous regime concerning the tax implications of share schemes for employees and directors.This amended legislation is applicable in respect of any share options or shares acquired after October 26 2004, and contains substantial differences regarding the manner, amount and timing of the tax implications of the above mentioned gains. It will therefore have a significant effect on current employee share schemes, as well as any future share option grants or share awards.

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Those nude Springboks – we are all naked before the Lord but not, please, in public Constitutional Law May 2007

Few members of the public, and particularly Springbok rugby fans, will have forgotten the Kamp Staaldraad scandal that gripped the nation in 2003.

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Much ado about Mohunram Constitutional Law May 2007

Proponents of the 'rule of law' were crowing at a recent Constitutional Court victory which, in the words of Asset Forfeiture Unit head Willie Hofmeyr, “will create a fair amount of uncertainty about the definition of organised crime." To paraphrase an esteemed silk, there might also be several letters of retrenchment floating around the office of the AFU in a few weeks.

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Making it easier to finance share purchases Company Law May 2007

s38 of the Companies Act prohibits a company from providing financial assistance to any person to enable that person to acquire shares in that company subject to certain limited exceptions. A subsidiary is also prevented from providing financial assistance to any person for the purpose of acquiring shares in that subsidiary's holding company.

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One size fits all approach may not work Company Law May 2007

State owned entities (SOEs) have become an increasingly common feature on the SA corporate landscape, with hundreds of entities listed under the Public Finance Management Act, 1999 (PFMA) ranging from bodies as diverse as gambling boards and provincial farming enterprises, to powerhouses such as Transnet, Eskom and Telkom.

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Calculating the litigation costs in insolvent estates Company Law May 2007

If creditors don't commit themselves to providing funding to a liquidator to enable him to prosecute recoveries for the benefit of an insolvent estate, generally the liquidator's hands are tied.

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The Tribunal acts with steely resolve Competition Law May 2007

The long-awaited decision of the Competition Tribunal in the complaint brought against Mittal Steel South Africa (formerly Iscor) by Harmony Gold Mining and DRDGold was finally handed down on February 27 2007.

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Consent orders, settlement agreements and premature mergers Competition Law May 2007

s49D of the Competition Act (89 of 1998) came under intense scrutiny during a recent Competition Tribunal. The hearing related to a Competition Commission application to have the settlement agreement reached between itself and South African Airways (SAA) confirmed as a consent order.

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