Financial Institutions Legal Snapshot

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A New Jersey court found that Amazon is not liable for a defective laptop battery it sold that caused a home to burn down. The plaintiff bought a laptop battery using an Amazon account which was sold by a Hong Kong company. She left the battery charging on her bed and the house burnt down while she was away. The question was whether Amazon was a ‘product seller’ under the state’s Product Liability Act. Amazon…
Shareholders of African Bank Investments Limited failed in their claim for over R720 million against the directors and auditors of African Bank. The plaintiffs sued unsuccessfully under section 218(2) of the Companies Act 2008 alleging that the conduct of the defendants resulted in a loss to the shareholders because of the drop in the share price. The scope of section 218(2) of the Companies Act has been debated since the law was enacted. It reads ‘any person who…
In the first proposed amendments to the Companies Act 2008 since coming into force in 2011, it is proposed that the Companies Tribunal be given the power to adjudicate matters referred to it by the BEE Commission. This amendment would enable the BEE Commission to refer matters to the Tribunal, particularly where complaints and reported transactions contravene both the Companies and BEE Acts. This demonstrates an effort by the BEE Commission to collaborate more closely…
The appeal court has found that the requirement to register as a credit provider is applicable to all credit agreements once the prescribed threshold is reached (currently zero), irrespective of whether the credit provider is involved in the credit industry and irrespective of whether the credit agreement is a once-off transaction. The appeal court reluctantly adopted this approach which is clear from the remarks made in the judgment – that this is an imperfect…
The Companies Amendment Bill released on 21 September 2018 for public comment, proposes a raft of amendments to the Companies Act. Section 45 presently provides that any financial assistance granted by a holding company to its subsidiary must be authorised by the board and the shareholders by way of a special resolution. If not the transaction is void and unenforceable. The Bill proposes that subsections (2), and consequently subsections (3) and (4) of section 45…
The Draft Financial Sector Laws Amendment Bill has been published for comment. The Bill proposes amendments to various acts including the Insolvency Act, the South African Reserve Bank Act, the Banks Act, the Mutual Banks Act, the Competition Act, the Financial Markets Act and the Insurance Act – with a view to strengthening the ability of the South African Reserve Bank to manage the orderly resolution or winding down of a failing financial institution with minimum…
A doctor who covers for a colleague has an immediate legal duty to care for his colleague’s patients whilst on call. This was recently confirmed by the Supreme Court of Appeal in a case where a doctor (gynaecologist/obstetrician) agreed to cover for a colleague. The doctor positively responded to a telephone call from a midwife at 10h30 informing him that his colleague’s patient had been admitted to the hospital at 10h00 for labour. The doctor…
The amendments proposed in the Companies Amendment Bill 2018 have caught the attention of financiers and attorneys in so far as the provision of financial assistance (e.g. providing a loan, guaranteeing a loan, and securing any debt or obligation), to ‘its own subsidiary’ is concerned. The Amendment Bill proposes to amend section 45 by removing the requirements of the shareholder and director approvals contemplated by sub-sections 45(2), (3) and (4) in the scenario where financial…
The long awaited South African Companies Amendment Bill (Bill) was published on 21 September 2018 for comment. Substantial changes to the South African Companies Act 2008 (Companies Act), which became law in 2011, have been proposed. Comments may be submitted to the SA Department of Trade and Industry by 20 November 2018, and we encourage business to consider the changes, and to provide feedback (DRamabulana@thedti.gov.za) to the Department. The key proposals relate to the following: Effective date of…
The Competition Amendment Bill proposes giving the Competition Commission broader powers, with more substantial remedies and the threshold for initiating a market inquiry has been lowered. Key changes include the expansion of the scope of market inquiries, the provision of a notification and consultation process with sector regulators and the granting of substantial powers to the minister in relation to market inquiries. Since it obtained the power to conduct market inquiries, the Competition Commission has…