The registration of securities under the new Companies Act 71 of 2008

• Jurisdiction: South Africa
• Date: 15 August 2019
• Citation: 2010 Acta Juridica 73
• Author: Muthundinne Sigwadi
• Pages: 73-86
• Published date: 15 August 2019

The registration of securities under the new

Companies Act 71 of 2008

MUTHUNDINNE SIGWADI*

This paper explores an area of company law dealing with the registration of

securities. It compares the procedure and the requirements for registering

securities in terms of the Companies Act of 1973, and the new CompaniesAct

of 2008. It also highlights the differences between the provisions of these two

Acts regarding registration of securities.

The paper further discusses how the rights of securities holders are pro-

tected in the new Companies Act of 2008 and highlights a new remedy

protecting the rights of the holders of issued securities.

It concludes with a submission that most of the provisions in the new

Companies Act of 2008 dealing with the registration of securities do not differ

signif‌icantly from those provided by the current Companies Act of 1973. A

submission is also made that, given the similarities between the two Acts,

authoritative interpretations (including some cases) of relevant provisions of

the Companies Act of 1973 may still apply and thus provide some guidance on

how to better understand and apply the new Companies Act of 2008.

I INTRODUCTION

In this paper, I shall discuss the registration of securities under the new

Companies Act 71 of 2008 (hereinafter referred to as the CompaniesAct,

2008). The Companies Act, 2008 has various provisions dealing with the

registration of securities.

1

Weneed to begin by looking at the def‌inition of

‘securities’. The new Companies Act, 2008, like the CompaniesAct 61 of

1973, does not def‌ine the term ‘securities’. It only provides that ‘securi-

ties’ has the meaning set out in s 1 of the Securities Services Act 36 of

2004, and includes shares held in a private company.

2

In addition to

* Associate Professor, Department of Mercantile Law,University of South Africa.

1

See, for example, ss 43, 47, 49 and 50 to 56 of the Companies Act, 2008. These sections

are discussed in the body of this paper.

2

The Securities ServicesAct, 2004 states that ‘securities’ means shares, stocks and depository

receipts in public companies and other equivalent equities, other than shares in a share block

company as def‌ined in the Share Blocks Control Act 59 of 1980; notes; derivative instruments;

bonds; debentures; participatory interests in a collective investment scheme as def‌ined in the

Collective Investment Schemes Control Act 45 of 2002, and units or any other form of

participation in a foreign collective investment scheme approved by the Registrar of Collective

Investment Schemes in terms of s 65 of that Act; units or any other form of participation in a

collective investment scheme licensed or registered in a foreign country; instruments based on

an index; the securities contemplated in subparagraphs (i) to (viii) that are listed on an external

exchange; and an instrument similar to one or more of the securities contemplated in

subparagraphs (i) to (ix) declared by the registrar by notice in the Gazette to be a security for the

purposes of this Act; and rights in the securities referred to in subparagraphs (i) to (x). This

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2010 Acta Juridica 73

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