What is the difference between the current Companies Act and the new Act?

The new Companies Act (Act 71 of 2008) repeals the current Act and the following are notable changes:

The policy enunciated in the new Act is one of: •Simplification of the legislation; simple and accessible language for all business and stakeholders

  • Reduction of the regulatory burden; simplicity and speed of formation of business entities
  • Decriminalisation: Recognising that this is a business legislative instrument constant reference to “if a person fails to file ...shall be guilty of an offence and upon conviction sentenced to a fine or imprisonment or both” etc. has been avoided in the new Act as far as possible except for issues of perjury, fraud etc.
  • It has been harmonised with other legislation such as Access to Information Act ,Protected Disclosures Act, Electronic Communications and Transactions Act, etc.
  • Furthermore, there are major changes to the new Act and are as follows:

  • Structural Arrangements and new regulatory institutions
  • Overhaul of Fundamental Transactions and Takeovers
  • Partial Codification of Corporate Governance aspects
  • New Concept of Business Rescue for failing companies

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