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- Volume 26, Issue 2, 2014
SA Mercantile Law Journal = SA Tydskrif vir Handelsreg - Volume 26, Issue 2, 2014
Volume 26, Issue 2, 2014
The Companies Act 71 of 2008 and the disclosure of and rights of access to information about securitiesAuthor S.M. LuizSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 167 –211 (2014)More Less
The Companies Act 71 of 2008 (the 'Companies Act 2008') reaffirmed the company as a means of achieving economic and social benefits for the South African economy, and it identified the promotion of investment in our markets as a key purpose. Confidence in our financial markets will be enhanced if our markets are fair, efficient and transparent, and this will attract investment. Requiring disclosure of and allowing access to information about companies encourages transparency.
The effect of employee-authors' moral rights on employer-owned copyright : surviving article 6bis of the Berne ConventionAuthor Lee-Ann TongSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 212 –227 (2014)More Less
The purpose of this contribution is to explore the effect of the 'moral rights' provisions of article 6bis of the Berne Convention for the Protection of Literary and Artistic Works (Berne Convention) on employer-owned copyright. It argues that the implementation of article 6bis (1) in the form advocated by the Berne Convention is incongruous with the prevailing purpose of copyright and consequently not sustainable in the modern economy. Although the examination is not jurisdiction specific, recourse is had to the South African approach in places, as an example of domestic implementation which attempts to make article 6bis more palatable.
Obstacles and barriers to the derivative action : costs orders under section 165 of the Companies Act of 2008 (part 2)Author Maleka Femida CassimSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 228 –246 (2014)More Less
The submission is made in paragraph II above that the South African courts should extend the principled approach to costs orders propounded in Wallersteiner v Moir (No 2) to costs orders under section 165 of the Act, so as to grant to shareholders, who have already obtained leave for a derivative action, a mandatory right to an indemnity from the company (save in exceptional circumstances). This proposal is bolstered by substantial authority in comparable jurisdictions. Other Commonwealth jurisdictions have also espoused the Wallersteiner approach to costs orders, whether directly in legislation or through decisions of the courts.
Redress in terms of the National Credit Act and the Consumer Protection Act for defective goods sold and financed in terms of an instalment agreementSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 247 –281 (2014)More Less
The scene seems all too familiar, representative of thousands of similar agreements concluded every day in South Africa. The consumer buys a motor vehicle from a motor dealership. He cannot pay the full amount of the purchase price immediately. The motor dealership assists him to apply for finance at a financial institution (for example, a bank). After that, the motor vehicle is financed and an instalment agreement (previously called an instalment sale agreement) is concluded between the consumer and the bank. Within six months after the delivery of the vehicle, the consumer starts to experience problems with it, and it becomes clear that the vehicle is of an unsatisfactory quality, cannot be used for the purposes for which it was bought, and is defective. If the customer attempts to hold the motor dealership responsible, the dealership argues that it no longer owns the vehicle and that the bank should be approached. Indeed, the dealership argues that the bank was the seller of the vehicle - which it often is. Should the consumer attempt to hold the bank responsible, the bank refers to the instalment agreement in which any warranty as to the condition of the vehicle is expressly excluded, and the bank also argues that it only financed the deal. After all, the bank is not a seller of vehicles in the first place.
Blowing the whistle on affirmative action : the future of affirmative action in South Africa (part 2)Author Marie McgregorSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 282 –306 (2014)More Less
Author Rehana CassimSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 307 –337 (2014)More Less
The separate legal personality of a company is the very foundation on which company law rests. The Companies Act 71 of 2008 ('the Companies Act') has introduced into South African company law, for the first time, a statutory provision permitting inroads to be made into this fundamental principle. Section 20(9) of the Companies Act permits a court to disregard the separate legal personality of a company and to pierce the corporate veil in instances of 'an unconscionable abuse of the juristic personality of the company as a separate entity'.
Curbing income tax avoidance that results from cross-border leasing : a comparative overview with specific reference to South AfricaAuthor Annet Wanyana OguttuSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 338 –386 (2014)More Less
Businesses often choose leasing instead of purchasing tangible assets or equipment such as industrial, commercial and scientific equipment. Indeed, over the last two decades the leasing of assets has become an important form of acquiring business assets or equipment internationally. Some of the commercial reasons for leasing instead of purchasing assets include the fact that in leasing arrangements, the lessee does not have to incur the burden of financing the equipment or bear the risks associated with the financing. There is thus no added liability to the balance sheet of the business, which makes it easier to increase its borrowing capacity. Leasing also makes it easier to replace assets regularly, thereby reducing the risks of obsolescence. It also enables the lessee to free working capital to finance current operations and other cash flow requirements.
Bureaucratic bungling, deliberate misconduct and claims for pure economic loss in the tender processAuthor Chuks OkpalubaSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 387 –415 (2014)More Less
South African Post Office v De Lacy and Another is the fourth in a line of Supreme Court of Appeal cases where plaintiffs had claimed damages arising from tenders for the supply of goods and services. Unlike in Minister of Finance and Others v Gore NO, where liability was upheld and large amounts in damages were awarded against the government, the claim in De Lacy suffered the same fate as that in Olitzki Property Holdings v State Tender Board and Steenkamp NO v Provincial Tender Board, Eastern Cape. As all four cases involved financial loss resulting from being unsuccessful in a tender award, one may ask: why did the claim in Gore succeed while those in the other three cases failed? Another pertinent question is: if applicants in a judicial review could succeed in setting aside a tender award resulting from an administrative irregularity as in the case of Steenkamp, or for any other form of impeachable administrative wrong, why would such a party not recover damages for loss of profit or out-of-pocket expenses arising from the botched transaction?
A comparison of ambush marketing legislation in the United Kingdom and section 15a of the Merchandise Marks Act 17 of 1941Author Marianne LombardSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 416 –435 (2014)More Less
Ambush marketing is generally described as the unauthorised use, by the competitor of an official sponsor, of the hype and goodwill generated by, and associated with, a major international sports event. The word 'ambush' refers to the perceived opportunism of the competitor, who is not an official sponsor of the event but takes advantage of and uses the event to promote its own brand or service. Ambush marketing is often regarded as unlawful competition, because it may infringe the rights of official sponsors.
The legal obligation to provide for employee-related contingent liabilities when an enterprise is sold as a going concernSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 436 –449 (2014)More Less
When a business or enterprise is disposed of as a going concern in South Africa, various issues arise in labour law. But a related tax issue is the deductibility of employee-related contingent liabilities for the purposes of income tax under sections 197 and 197A of the Labour Relations Act (LRA). In terms of section 197, employers must provide for and pay employee-related contingent liabilities when transferring a business as a going concern.
Bananas and public announcements : defining the boundaries of anti-competitive information exchangesAuthor Thandi LamprechtSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 450 –475 (2014)More Less
Information exchange between competitors remains a murky area of competition law. It is not always clear when pro-competitive information sharing ends and collusive conduct begins. There are many shades of grey in between. It is also an area where there has been much development in recent years.
Author Stella VettoriSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 476 –486 (2014)More Less
Discrimination based on race and gender has a long history in South Africa. Discrimination against women and discrimination against Black people has seen to it that Black women have received a double dose of discrimination. Discrimination on the basis of race was politically motivated in the apartheid era in South Africa. Gender discrimination, on the other hand, has its roots in sociocultural dictates of all groups. In order to redress the inequalities of the past, South Africa has adopted sophisticated rights-based legislation with specific reference to inter alia gender equality. In its attempt to reverse the adverse effects of all forms of discrimination, including gender discrimination, the government of South Africa has since 1994, when it first became a democracy, adopted and developed legislation to promote equality between all people, regardless of race, gender, class, disability and sexual orientation.
A critical evaluation of the nature and operation of liens in South African law in comparison with Dutch law : analysisAuthor Mitzi WieseSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 487 –497 (2014)More Less
Virtually everyone who has reached the age of majority has encountered the legal phenomenon of a 'lien' at one time or another. For example, when someone takes his motor vehicle to a mechanic for repairs, the mechanic has the right to retain the motor vehicle until the person (the debtor) has remunerated him for his services; a person who takes his coat to a dry-cleaner cannot demand his coat back before he has paid the dry-cleaner for his services; an accountant has the right to withhold the financial statements he has drawn up for a business until the business has paid him for his services. It is apparent from this that the man in the street encounters liens in a variety of situations. It is quite possible that there are many cases where a person is entitled to retain a thing on which he has spent money or expended labour but is not aware of the fact. A lien is an immediate form of security for the creditor. No protracted court procedures or legal costs are required. A lien arises as of right and clothes the holder thereof with a passive form of security in terms of which he can simply remain in control of the thing until his outstanding claim (the debt) has been satisfied. Because access to the courts in South Africa is both time-consuming and expensive, this form of security is very valuable. It enables the lien holder simply to remain in control of the thing, thereby securing payment of his claim.
Securing tax exemption for the income of a public school and the tax deductibility of donations to the school : navigating the maze of South Africa's Income Tax Act : analysisAuthor R.C. WilliamsSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 498 –514 (2014)More Less
Most income tax systems recognise that certain income should be exempt from tax, for example, income earned by what may loosely be called 'charitable' undertakings and used to finance their activities. Naturally, tax legislation in this regard has to be tightly drafted so as to ensure that only bona fide charities qualify for tax exemption, and that charities do not exploit their tax-exempt status to engage in extraneous commercial activities and thereby earn undeserved tax-free income. Tax legislation also tries to thwart attempts by commercial entities to disguise themselves as charities and thereby gain tax exemption for their income. Tax-avoidance stratagems involving tax-exempt charities affect revenue collection by the fiscus.
Is the supply of services in the duty-free area at an international airport in South Africa subject to VAT? : Master Currency (Pty) Ltd v Commissioner for the South African Revenue Services : case noteAuthor S.P. Van ZylSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 515 –532 (2014)More Less
International passengers usually buy luxury goods such as perfume, liquor, electronics, cigarettes, and fashion items at duty-free zones at international airports or boarding ports under the impression that these goods are stripped of all local and international taxes. The hustle and bustle at these duty-free zones should indicate the popularity of the tax incentive (see Frances Cha 'And the world's most lucrative airports are...' (2012) CNN Travel (14 June 2012), available at http://travel.cnn.com/explorations/shop/and-worlds-most-lucrative-airportsare-006206, accessed on 3 July 2013). It is well known that the incentive is based on the perception that the goods so purchased are intended for export and should, as a result, be stripped of local taxes in accordance with the destination principle applied in modern Value-Added Tax systems (see Liam P Ebrill The Modern VAT (2001) 15-16, 179-80).
Franchise agreements : the transfer of a business (franchise) as a going concern. PE Pack 4100CC v Sanders and Others : case noteSource: SA Mercantile Law Journal = SA Tydskrif vir Handelsreg 26, pp 533 –541 (2014)More Less
Section 197 of the Labour Relations Act 66 of 1995 ('the Act') has received considerable attention from the highest courts in the country (Aviation Union of South Africa and Another v South African Airways (Pty) Ltd and Others 2012 (1) SA 321 (CC) ('the Aviation Union case'); NEHAWU v University of Cape Town and Others 2003 (3) SA 1 (CC) ('the UCT case'); SAMWU and Others v Rand Airport Management Company (Pty) Ltd and Others  3 BLLR 241 (LAC); and Ponties Panel Beaters Partnership v NUMSA and Others  2 BLLR 99 (LAC) ('the Ponties Panel Beaters case')). The Constitutional Court in the UCT case confirmed that section 197 of the Act applies to outsourcing agreements. In the Aviation Union case (supra), the Constitutional Court held in its most recent judgment dealing with section 197 that section 197 also applies to so-called second-generation outsourcing agreements.