POPI: First meeting for the Information Regulator

POPI: First meeting for the Information Regulator

In our blog post on 7 November 2016 we referred you to the appointment of the members of the Information Regulator – which is an independent juristic person in terms of the Protection of Personal Information Act – commonly referred to as “POPI”. The Information Regulator will be responsible for monitoring and enforcing compliance with both POPI and the Promotion of Access to Information Act 2000 (PAIA).

The 5 members of the Information Regulator (Chairperson, 2 full-time and 2 part-time) have been appointed for a 5 year period that commenced the beginning of the month and according to a media statement issued by Adv. Tlakula (the Chairperson) on 2 December 2016, the Information Regulator held a meeting on 1 December 2016 to commence their function and duties. It has been confirmed that the full time member responsible for PAIA is Adv. Stroom-Nzama and the full time member responsible for POPI is Adv. Weapond.

The POPI commencement date has not been confirmed yet, but the general view in the industry is that 24 May 2017 is the likely day – as this will mean that compliance with POPI will be required as from the 25th of May 2018, which is also the date for compliance with the European Union’s General Data Protection Regulation.

In practice we are starting to see more clients focussing on POPI requirements and starting to create POPI awareness through training sessions and implementation of amended policies and practices. It would probably be unrealistic to think that POPI will mean a “quick fix” for all data concerns, but POPI will certainly play a big role to regulate the way in which companies manage data in future.

Takedown notices

Takedown notices

What is a takedown notice?

A takedown notice is a procedure set out in section 77 of the Electronic Communications and Transactions Act 25 of 2002 (“ECTA”) that provides for a process to request that unlawful content on a website be removed from the internet. A takedown notice is initiated by the person alleging that the content is unlawful as a result of the content being their information which they have not consented to displaying on the website or where the content infringes your copyright. Often, the offending content is a photograph or personal information, such as credit card or banking details.

What is ISPA (The Internet Service Providers’ Association)?

ISPA was established in 2002 in terms of chapter 11 of the Electronic Communications and Transactions Act 20 of 2002 (“ECTA”) and is as a result classified as an Industry Recognised Body (“IRB”). ISPA only has jurisdiction over its members and membership is voluntary. Members of ISPA are those entities that operate as Internet Service Providers (“ISP”) in South Africa and joined ISPA.

The function of ISPA with regard to takedown notices is of an intermediary nature, as ISPA merely checks that applications are complete, that the ISP is a member and that the remedy requested is feasible. If the application complies, ISPA forwards it on to the applicable ISP who responds either by removing the content or by refusing the request. Most correspondence occurs between the ISP and ISPA, however, the ISP may contact the complainant directly as well.

What ISPA considers

The first thing ISPA looks at is whether the ISP is registered as a member of ISPA. If the ISP is not, then ISPA will not be able to assist with the takedown application. ISPA also does not assess the validity of the allegation in the takedown notice, i.e., ISPA will not consider the legality or lawfulness of the allegation.

Is ISPA effective in South Africa?

ISPA does seem to be effective in South Africa. Its website contains statistics, dating back to 2006, showing, amongst others, the number of takedown requests lodged, the outcomes of such requests and the reasons for rejected requests. For more information in this regard, please see the website. In cases where the content on the website is obviously unlawful or problematic the website or content is usually removed immediately.

However, ISPs are not required to comply with takedown notices. If they refuse, they may run the risk of incurring liability in terms of the common law, but this may be a low risk. In circumstances where the ISP wants the content to stay up, the ISP must indemnify ISPA against any and all liability that may arise from the content.

How to request a takedown notice

Requests must be made to ISPA in writing and include the following information:

  1. Your information: name, address, contact number and email;
  2. The service provider against who you are making the complaint;
  3. A clear identification of the unlawful or problematic content, including the URL and an optional screenshot of the content;
  4. A description of the right that you think has been infringed;
  5. The remedy that you seek;
    • This remedy should be reasonable and should not request the entire website to be taken down
  6. A statement that the content of your complaint is true and correct to your knowledge and that you are acting in good faith; and
  7. Your signature.
POPI News: Appointment of the Information Regulator

POPI News: Appointment of the Information Regulator

“Are you ready for POPI??” This question has been asked so many times in marketing material over the last couple of years. Answering this question has lately become very relevant, since the POPI Information Regulator has (at last) been appointed!!  Advocate Pansy Tlakula, former chairperson of the South African Independent Electoral Commission, has been appointed as the chairperson of the office of the Information Regulator.  The remainder of the office is made up of four others, two full-time members and two part-time members. Advocate Cordelia Stroom and Johannes Weapond will fulfil the full-time positions with Professor Tana Pistorius and Sizwe Snail as the part-time members.  The office of the Information Regulator will be effective from 1 December 2016 and members will hold office for five years. They will be eligible for reappointment after the first five-year period.

The office of the Information Regulator has been granted widespread powers, amongst others, to investigate alleged breaches of POPI as the office provides a platform for data subjects to approach with any complaints.

With the appointment of the Information Regulator we are likely to receive a date for the commencement of POPI relatively soon.  This will result in the remainder of the Act commencing and will grant responsible parties a “grace period” of one year from the effective date to become compliant with the Act.  The sections of POPI which have already commenced are:

  • Section 1, the definitions clause;
  • Part A of Chapter 5, which deals with the establishment, staffing, powers and meetings of the Information Regulator;
  • Section 112 which authorises the Minister and Information Regulator to make regulations; and
  • Section 113, the procedure for making regulations.

The Information Regulator has been granted a budget by the Minister of Finance. This budget is to be used for the establishment and capacitation of the office. R10 million has been set aside for the 2016/2017 financial year, R26 million for the 2017/2018 financial year and R27 million for the following financial year.

What we can expect to happen next:

  1. Regulations will be promulgated;
  2. And the commencement date will be announced.

Contact us for more information on all POPI questions.

When is a company subject to the Takeover Regulations?

When is a company subject to the Takeover Regulations?

What are the Takeover Regulations?

Since the Companies Act No. 71 of 2008 (as amended) (“the Companies Act“) came into effect on 1 May 2011, there has been a paradigm shift in the regulation of South African mergers and acquisitions (also known as “fundamental transactions”).  It is understood that the changes introduced into the Companies Act were intended to afford greater protection to minority shareholders in companies where certain transactions are concluded by such companies.  However, these new provisions have also brought with them some trepidation as for many small or medium-sized private companies, the administrative duties associated with the regulation of those transactions are fairly onerous and costly.

If a company intends concluding any transaction contemplated in Chapter 5 of the Companies Act, it is important to ascertain whether the Takeover Regulations apply to that transaction.  If so, various disclosures, approvals and reporting requirements will then need to be met or sought from the Takeover Regulation Panel (“TRP“).  The TRP is the regulatory body that was established under the Companies Act to regulate certain transactions.

Non-compliance with the Takeover Regulations

If there is non-compliance with these laws by a company, a complaint may be filed by an interested party with the TRP, who may investigate such complaint and, if deemed necessary, the TRP may issue a compliance notice to the infringing company.  If this compliance notice is not complied with, a court may impose an administrative fine on the infringing company that may not exceed the greater of 10% of its turnover for the period of non-compliance, or R1 million.

It is therefore vital to consider whether these laws are applicable in order to comply and avoid any penalties for infringements.  However, if the transaction has already taken place and the non-compliance has already happened, it is possible to apply for exemptions or condonations for late filing.

Who is subject to the Takeover Regulations?

The Takeover Regulations apply to a regulated company with respect to an affected transaction or an offer, but there are some exceptions.

In considering the applicability, it is first necessary to ascertain whether the company is a regulated company.  According to the Companies Act (sections 117(1)(i), 118(1) and (2) and Takeover Regulation 91), this is either:

  • a public company; or
  • a state-owned company (with some exemptions, see section 9); or
  • a private company:
    • that expressly elects to be regarded as a regulated company in its memorandum of incorporation, or
    • if more than 10% of its issued securities have been transferred within the previous 24 months (other than by transfer between related or inter related persons).

It is important to note that when using a shelf company and transferring the shares from the incorporator to a new shareholder/s, the initial transfer will not be subject to the Takeover Regulations, however the shelf company will be categorised as a regulated company for the following 24 months.

If a transaction involves a regulated company, the next step is to consider whether the transaction in question is an affected transaction as defined in section 117(1)(c) as follows:

  • a transaction (or series of transactions) amounting to the disposal of all or the greater part of the assets or undertaking of a regulated company (sections 112 and 118(3));
  • an amalgamation or merger involving at least one regulated company (sections 113 and 118(3));
  • a scheme of arrangement between a regulated company and its shareholders (sections 114 and 118(3);
  • the acquisition of, or announced intention to acquire, a beneficial interest in any voting securities of a regulated company (section 122(1);
  • the announced intention to acquire a beneficial interest in the remaining voting securities of a regulated company not already held by a person or persons acting together;
  • a mandatory offer (section 123); or
  • a compulsory acquisition (section 124).

According to section 117(1)(f), an offer means a proposal of any sort, including a partial offer, which, if accepted, will result in an affected transaction (except for a transaction which is exempt in terms of clause 118(3)).

However, the Takeover Regulations do not apply if:

  • an approved business rescue plan requires or contemplates the fundamental transaction;
  • the transfer of more than 10% of the issued securities is due to a company buy-back; or
  • the transfer is between related or inter-related persons (sections 118(3) and 121(b)(ii) and Takeover Regulations 91 (2)(b) and 83).

Exemption from the application of the Takeover Regulations

It is possible to apply to the TRP for an exemption and such application must include:

  • an explanation of the transactions involved;
  • a justification as to why the TRP has jurisdiction;
  • the argument as to why the applicant should be entitled to exemption (section 119(6); and
  • consent of all shareholders in the form of waivers of their rights pursuant to the takeover regulations.

The TRP is entitled to grant an exemption if:

  • there is no reasonable potential of the affected transaction prejudicing the interests of any existing securities holder of a regulated company;
  • the cost of compliance is disproportionate to the relative value of the affected transaction; or
  • doing so is otherwise reasonable and justifiable in the circumstances.

The TRP is not supposed to or required to consider the commercial advantages or disadvantages of any transaction or proposed transaction, but rather to ensure the integrity of the marketplace and fairness to the holders of the securities of regulated companies. In addition, the TRP must prevent actions by a regulated company designed to impede, frustrate or defeat an offer or the making of a fair and informed decision by the holders of that company’s securities.

This area of law is not always straightforward and easy to navigate, but the TRP is an approachable organisation if help is needed in understanding the applicability of the Takeover Regulations to certain transactions.  Our commercial teams have been involved in many transactions involving the Takeover Regulations and the TRP and are available to assist with any queries.

FICA – Potential Amendment of Schedules might affect credit providers

FICA – Potential Amendment of Schedules might affect credit providers

The Financial Intelligence Centre (FIC) has issued a notice in September 2016 regarding possible amendments to the existing Schedules to the FIC Act. The intention is to consider whether activities that currently fall outside of the ambit of the FIC Act should in actual fact be included.

According to the notice issued: “The proposal to include certain businesses or institutions is based, in part, on the Centre’s view that these businesses or institutions may present a higher risk of being used to carry out money laundering or terror financing activities.”

Some of the categories specified in the notice that will be considered to fall within the ambit of FICA going forward include:

*         Dealers in high value goods (like motor vehicles)

*         Co-operatives which provide financial services

*         Credit providers

*         Short term insurers

We have been in contact with the FIC Centre and they have confirmed that the consultation process will start soon. Next steps will therefore be for the Centre to consult with the relevant industry representatives such as the National Credit Regulator.

We will keep you updated on any news in this regard.

Close Corporations: a member’s authority to bind it and personal liability for its debts

Close Corporations: a member’s authority to bind it and personal liability for its debts

As a result of changes to South Africa’s company laws, effective as from 1 May 2011, it is no longer possible to register a new close corporation (“CC“) in South Africa.  However, there are many CCs that have remained in existence that still require regulation.  In this article, we have considered a few of the most common CC-related questions our clients have been faced with.

One of the main benefits of a CC is that it is often administratively easier to regulate than a company, while also being a juristic person distinct from its members who have limited liability.  The individual members’ interests in the CC are determined according to their percentage of ownership, as opposed to a company where shareholders acquire shares in the company.

The regulation of CCs is governed by the Close Corporations Act, 69 of 1984 (as amended) (“the Act“) and the terms set out in the association agreement that has been concluded between the CC and its members (if any).  If no such agreement has been entered into, the Act must be relied on as the default position regulating the CC and its members’ rights and obligations.

Can the conduct of a member of a CC bind the CC?

Members have the authority to act on their own and this can have the effect of binding the CC, unless the authority of the member in question has been restricted and the other party to the transaction knows or ought to have known of that restriction.  Section 54(1) of the Act states “Subject to the provisions of this section, any member of a corporation shall in relation to a person who is not a member and is dealing with the corporation, be an agent of the corporation…”.

The effect of this section is that each member of the CC has the ability to bind the CC in their individual capacity, except where there is an association agreement which states otherwise or it is expressly dealt with in terms of the default internal relations rules set out in section 46 of the Act.  Section 46(b) provides that members shall have equal rights with regard to the management of the business of the CC and with regard to the power to represent the CC in the carrying on of its business, provided that the consent of a member (or members) holding a member’s interest of at least 75%, shall be required for the following fundamental decisions:

  • a change in the principal business carried on by the CC;
  • a disposal of the whole, or substantially the whole, undertaking of the CC;
  • a disposal of all, or the greater portion of, the assets of the CC; and
  • any acquisition or disposal of immovable property by the CC.

Section 46(b) protects individual members to a degree, in that 75% or more of the members’ interests acting together are required to successfully bind the CC if they wish to give effect to any of the material changes or substantial transactions recorded in that section.

Can members be held personally liable for the debts of the CC?

The default position for personal liability in terms of the Act is that the members of a CC shall not merely by reason of their membership be liable for the liabilities or obligations of the CC (section 2(3) of the Act).  As such, members are not ordinarily held liable for the liabilities and obligations of the CC as the CC is treated as being independent of its members. As with a company, the members would not be liable for the liabilities and/or other obligations of the CC unless a member has signed as surety, guarantor or indemnitor for such debts and/or obligations of the CC.

However, in certain circumstances members are deemed to be personally liable for the liabilities and obligations of the CC, as set out in sections 63, 64 and 65 of the Act.  In summary, these sections provide for a member’s personal liability if a member disregards their duties, commits acts of gross negligence in the carrying on of the business of the CC and/or abuses the separate juristic personality of the CC.

In addition, members can agree to be held personally liable for debts of the CC but this will require the members to enter into a separate agreement for these purposes.  For example, in the case of a sale of a members’ interest or the business of a CC, one or more members may decide to agree to be held personally liable to the buyers for any liabilities of the CC that arose prior to the sale.

How to deal with oppressive conduct by members

The fact that members can act on their own and bind the CC in certain situations, regardless of the other members’ wishes, can lead to unfair and/or prejudicial situations.  If a member of a CC feels that his/her fellow members have unfairly prejudiced him/her in any way or that their acts have been oppressive, in terms of section 49 of the Act, that member can apply to the court for the granting of a remedial order in respect of such conduct.

Section 49 gives the court wide discretionary powers to make orders “with a view to settling the dispute” between the members of a CC, if it is just and equitable to do so.  Such an order could include ordering the offending member to purchase the member’s interest of the affected member (or members) at a fair price, whether he/she wants to or not, in order to compensate an affected member for the binding of the CC in a transaction or other arrangement that is deemed by the court to be unjust and/or inequitable.

This short outline provides some general advice relating to CCs, but there may be unusual situations where it is advisable to obtain specific advice from your attorney.

National Wills Week – Dommisse Attorneys

National Wills Week – Dommisse Attorneys

This year we’ll be participating in National Wills Week from 12 – 16 September 2016.
For anyone who wishes to have a basic will drafted at no charge, all they’ll need to do is contact leanne@dommisseattorneys.co.za to schedule an appointment.

The attending practitioner will send a short questionnaire that each person is required to complete and return prior to any consultation.

Please note that this is a free service and is offered on a first come first serve basis.


Companies Act, 71 of 2008 Series Part 8: Financial assistance under the Companies Act

Companies Act, 71 of 2008 Series Part 8: Financial assistance under the Companies Act

The Companies Act, 71 of 2008, as amended, (“the Act“) regulates the provision of financial assistance by a company, either in respect of the acquisition of securities in that company in terms of section 44 of the Act, or the provision of financial assistance to directors or prescribed officers of that company in terms of section 45 of the Act. Under certain circumstances, and with the appropriate approvals, a company may be authorised to provide financial assistance in one of the two categories mentioned above.

For purposes of this article, we will only deal with Part 8.1: Financial assistance for acquisition of securities, and in a later article, we will deal with Part 8.2: Financial assistance to directors and prescribed officers.

8.1: Financial assistance for acquisition of securities

If a company is considering providing financial assistance for the purposes of the acquisition of securities, the provisions of section 44 of the Act must be adhered to. Securities include any shares, debentures or other instruments issued or authorised to be issued by a company.  This article, however, only discusses on the provision of financial assistance for the acquisition of shares in a company.

What is financial assistance for the purposes of the acquisition of shares?

In terms of section 44 of the Act, financial assistance is widely defined as including a loan, guarantee, the provision of security or otherwise, but does not include lending money in the ordinary course of business by a company whose primary business is the lending of money. In respect of the shares of a company, a company may provide such financial assistance to a person wishing to subscribe for shares in that company, or to a person who wishes to purchase shares in that company from an existing shareholder of that company.

What approvals are required?

The board may authorise such financial assistance to an acquirer of shares unless the company’s memorandum of incorporation (“MOI“) prohibits this. The nature of the board’s authorisation is specified in the Act. The board must be satisfied that (i) immediately after providing the financial assistance, the company would satisfy the solvency and liquidity test*; and (ii) the terms under which the financial assistance is proposed to be given are fair and reasonable to the company. The board’s approval for the granting of financial assistance for the purposes of share acquisitions is limited further – the shareholders are also required to pass a special resolution within the previous two years of the proposed financial assistance, approving, either specifically or in general, recipients for such financial assistance. Unless the financial assistance is in terms of certain employee share schemes, both board and shareholder approval is required, as indicated above, for the granting of financial assistance to a party for the purposes of acquiring shares in the company (or any related or inter-related company).

*Solvency and liquidity test: the assets of the company, fairly valued, equal or exceed the liabilities of the company, fairly valued and it appears that the company will be able to pay its debts as they become due in the ordinary course of business for a period of 12 months after the date on which the test is considered.

What if you didn’t get these approvals?

If financial assistance is granted by the company in a manner which does not comply with the provisions of section 44 or any conditions or restrictions contained in the company’s MOI in respect of the granting of such financial assistance, then the decision of the board, or an agreement with respect to the provision of such financial assistance, is void to the extent of any such inconsistency. Practically, this means that any shares which were issued or sold on the basis of such unauthorised financial assistances are unauthorised acquisitions. Any director of that company who knowingly provides financial assistance in a manner which is inconsistent with the Act or the company’s MOI, could be held liable for any loss, damages or costs sustained by the company as a direct or indirect consequence of such actions.  If you suspect that your company may have granted unauthorised financial assistance to any person for an acquisition of shares in the company, please feel free to contact our Commercial Team so that we can formulate a plan to try to rectify any such granting of unauthorised financial assistance.


The rationale behind the Act regulating the provision of financial assistance by a company for share acquisitions is primarily to protect the company’s value. One of a company’s purposes is to raise capital and not to distribute its own capital to the detriment of its shareholders. These specific safeguards on the board’s power and control over the Company are unalterable provisions under the Act and should be carefully considered and understood when considering financial assistance.

These provisions may also be more wide reaching than you may expect. Section 44 applies to the provisions of financial assistance “for the purpose of or in connection with” the acquisitions of shares. It also applies to “securities” which is a wider concept than “shares“. In addition, the financial assistance may be granted in the context of a related or inter-related company*. Such considerations may make a difference in your specific case and should be interrogated accordingly.

Quick tips

  • If you are a shareholder: make sure you understand what it is that you are approving in terms of financial assistance as contemplated in the Act and your company’s MOI and why you are being requested to do so.
  • If you are a director: make sure you understand what is expected of you in terms of the Act and your company’s MOI and your liability if you do not act accordingly.
  • If you are acquiring shares (whether by a subscription for new shares or a purchase of shares from an existing shareholder) using funds loaned from the company: make sure the necessary approvals are obtained otherwise the shares you hold will be unauthorised.

* Companies are related if (i) either of them directly or indirectly controls the other, or the business of the other; (ii) either is a subsidiary of the other; or (iii) a person directly and indirectly controls each of them or thee business of each of them.

Twin peaks to date

Twin peaks to date


The 2008 Global Financial Crisis (“Financial Crisis”) may have come and passed and the worst thereof behind us but the world economy continues to face financial challenges. In efforts to plug the gaps experienced during the Financial Crisis and guard against similar financial crisis, the National Treasury (“Treasury”) drafted and proposed a Bill known as the Financial Sector Regulation Bill (“FSR Bill”) commonly known as “Twin Peaks” Bill.

By way of background, the FSR Bill was first introduced in the form of a policy paper, entitled “A safer financial sector to serve South Africa better” published by the Treasury in 2011. In December 2013, a first draft Bill was published for public comment. Taking into consideration comments made during the first round of public consultation, a revised version (second draft) was published for another round of public comment in 2014. The Bill is currently before the Standing Committee on Finance (“SCOF”) for their review and to allow SCOF to make recommendations before sending it to the National Assembly for further review.

In essence, the Bill seeks to bring regulation of services relating to banking, insurance, pension, collective investment schemes, credit industry etc. under the umbrella-regulation. This means that all these services will eventually fall under the ambit of a single sector (i.e. Financial Sector).


As indicated above, the primary purpose of the Bill is to establish a twin peak approach designed to underpin a comprehensive regulatory system with the following two main aims:

  • strengthen financial safety and soundness of financial institutions by creating a dedicated Prudential Authority (PA); and
  • to better protect financial customers and ensure that they are treated fairly by financial institutions by creating a dedicated market conduct authority – the Financial Sector Conduct Authority (FSCA).

If approved, the Bill will bring about a number of changes in the manner in which the affected institutions conduct business. To reduce risks and simplify the implementation process, the Treasury proposed implementing the Bill in two phases as opposed to one.

During phase 1, the focus will be on who regulates. This phase of implementation will see two regulators (enforcement peaks), namely PA and FSCA, being established. While the PA (proposed SARB unit) will be concerned with the safety and soundness of individual firms and aim to ensure financial firms are run prudently, the FSCA will be concerned with how individual firms behave in treating their customers. The current Financial Services Board will cease to exist and its prudential responsibilities will be transferred to the PA.

Moving away from the current position in relation to ombud system, the Bill proposes a single and unified Ombudsman. In brief, there is currently an ombud for each industry or sector and that will be done away.

During phase 2, the focus will be on how the regulators regulate and what they regulate. These include anything around (i) issuing regulatory requirements, (ii) licensing, (iii) supervising regulated entities and (iv) taking enforcement actions.

Credit providers take a particular interest in the Bill as credit products and services will (in terms of the current draft) also be included within the ambit of the new law. This of course begs the question on how compliance with the National Credit Act will be enforced since the Bill does not take away the powers of the National Credit Regulator in terms of the NCA to regulate and enforce compliance.

Do all credit providers need to register?

Do all credit providers need to register?

It has been widely reported that all credit providers should now register with the National Credit Regulator (the “NCR”) as a result of the new threshold for registration as a credit provider of R0 (nil) which was published on 11 May 2016. But is it really required that every business that lends money, regardless of the amount, must now, strictly speaking, register as a credit provider with the NCR?

Section 40 of the National Credit Act 34 of 2005 (“NCA”) requires a person to register as a credit provider if the total principal debt owed to that credit provider under all outstanding credit agreements, other than incidental credit agreements, exceeds the threshold determined by the Minister of Trade and Industry. Prior to the recent amendments of the NCA a person had to register as credit provider if it was the credit provider of at least 100 credit agreements or the principal debt owed to him or her in terms of all current credit agreements exceeded R 500 000. After the amendment of the NCA by the National Credit Amendment Act 19 of 2014, a person was only required to register as a credit provider if the total principal debt owed to him or her in terms of all current credit agreements exceeded R 500 000 (meaning that the number of 100 credit agreements or not became irrelevant and even if the number of 100 was exceeded but the total principal debt owed in terms of the total agreements was less than R 500 000, then no registration was required). On 11 May 2016, however, a new threshold of R 0 (nil) was published and from 11 November 2016, 6 months after the publication of the new R 0 (nil) threshold, all credit providers (irrespective of the number of credit agreements) should register as credit providers with the NCR. Failure to register as a credit provider could result, amongst others, in the credit agreement between the credit provider and its debtor being declared void as an unlawful agreement.

This does, however, not mean that every single person or business that lends money must register as a credit provider. The following should be considered to determine whether to register or not:

  • Is the credit agreement an incidental credit agreement? Section 40(1)(a) of the NCA does not require the registration of a credit provider if the transaction relates to an incidental credit agreement.
  • Is the person a credit provider as defined in the NCA?
  • Is the transaction a credit agreement as defined in the NCA?
  • Will the credit agreement be concluded within, or will it have an effect within the Republic?
  • Are the parties to the credit agreement dealing “at arm’s length“?
  • Do any of the exceptions provided in section 4 apply? For example: the NCA does not apply to a credit agreement where the consumer is a juristic person whose asset value or annual turnover, together with the combined asset value or annual turnover of all related juristic persons, at the time the agreement is made, equals or exceeds the threshold value determined by the Minister (currently R 1 million).

To determine whether you are required to be registered before the due date of 11 November 2016, do not hesitate to contact us.