The Commission’s ENFORCEMENT objective in relation to the Companies Act, No 71 of 2008, section 186 (1) (e), is to ensure the efficient, effective and widest possible enforcement of this Act, and any other legislation listed in Schedule 4 of this Act.
As the Commission is the custodian of the Companies Act, No 71 of 2008, the Commission’s Enforcement arm intends to provide leadership in its enforcement approaches which will be executed in terms of the legislative provisions outlined hereunder.
It needs to be mentioned that the Companies Act, No 71 of 2008 allows the Commission to continue investigations pending under the Companies Act No 61 of 1973 and also provides for the Companies and Intellectual Property Commission (CIPC) to exercise any power of the Minister or the Registrar of Companies to investigate any breach of that Act, subject to the fact that the breached must have occurred during the period of three years immediately before the effective date.
Alternative Dispute Resolution
In terms of terms of the Companies Act, No 71 of 2008, provision is made in sections 156, 157, 159 and 166 and 169 for alternative dispute resolution procedures.
A person as provided for in section 157(1) may seek to address an alleged contravention of this Act, or enforce any provision, right, transaction or agreement contemplated in terms of this Act or Memorandum of Incorporation (MOI) or rules through alternative dispute resolution by the Companies Tribunal or accredited agency, provided it is within three years after the act or omission causing the complaint.
If the Companies Tribunal or accredited entity has resolved, or assisted parties in resolving a dispute, it may record the resolution in the form of an order, and if the parties consent to that order, submit it to a court to be confirmed as a consent order.
The application for a consent order must be heard by the court. The court may make the order as agreed and proposed in the application, make changes to the draft order before making it an order of the court; or refuse to make the order.
A confirmed consent order may include damages; and only when the confirmed consent order includes an award of damages that person can apply for an award of civil damages.
A court may order the proceedings closed to the public if confidentiality is in the interest of the parties.