A step towards possible reform
As the country emerges out of the Covid-19 lockdown, it is evident that many companies were not able to survive the almost six-month period of limited income. Some industries never had any income at all until the announcement of Level 1 restrictions.
This has placed a lot of companies in distress and has increased the need for business turnaround and business rescue professionals whose skills are sorely needed. However, this need has also highlighted the unfortunate weak points that our current legislation has.
In an effort to address this, the Companies and Intellectual Property Commission (CIPC) recently formed the Business Rescue Liaison Committee (BRLC) which hopes to look at Chapter 6 of the Companies Act (71 of 2008) and make specific recommendations which will hopefully lead to change.
The Turnaround Management Association of Southern Africa (TMA-SA) has representation on the BRLC and attended the first meeting on 21 September.