Spoor & Fisher
The firm won a Gold Award for the Best IP Advisor Africa & Middle East category, at the first Innovation & IP Forum Awards held in Paris on the 23rd January. The awards recognise the best IP firms in the EMEA region, and are dedicated to among others, the challenges and opportunities worldwide in patent, trade mark, IT, IP litigation and other related rights.
Chatting to the Editor recently, I was told that the April edition of our favourite law magazine is going to take a look at where the top law students of 2008 are now. What have they been up to in the past 10 years? What was life like back in 2008? Well, I thought this month I would take you on a waltz down memory lane.
The Cederberg lies approximately 250km north of Cape Town. Cederberg Private Cellar, situated between Citrusdal and Clanwilliam, is the highest wine farm above sea level in the Western Cape – on average 1000m above sea level. The cool Mediterranean climate of Cederberg Private Wine Cellar leads to longer ripening periods and provides a perfect terroir for David Nieuwoudt, fifth generation owner of the farm, to create some of the Cape's most amazing wines.
Artificial Intelligence permeates our modern existence. Film has explored both the desirable and horrific qualities of Artificial Intelligence. Tabloids love the edgy subject – "Machines here to take our jobs." As is often the case, truth is to be found somewhere inbetween the binary oppositions that are used to provoke.
In 2016, SA hovered just above junk status; money that may have gone into local deals was kept under lock and key by South African investors, who were nervous about putting more money into local companies, while foreign investors turned their attention to other countries. In 2017 things got much worse, hobbled by a president and a number of members of his cabinet who appeared to neither understand nor care that the repercussions of their actions negatively impacted the economy, legislative uncertainty in certain areas, and with the stigma of corruption abounding, the country fell into junk status.
Looking back, the South African PE landscape looked fundamentally different in its early stages of development. Initially there were only two key players, FirstCorp Capital Investors (the predecessor to Ethos) and Brait. Deals were straightforward and swiftly executed, there was little regulation or need for conditions precedent, and most deals closed shortly after signature. Acquisition agreements were brief and debt agreements not much longer. PE lawyers were generalists, managing all upstream fund establishment matters and downstream transactional matters, including tax structuring and debt.
According to the third edition of our Global Transactions Forecast, the easing of key economic and political risks and the emergence of positive macroeconomic deal drivers will accelerate global deal activity in 2018. Deal making in South Africa and Nigeria looks set to increase in 2018 and 2019 after a period of policy uncertainty which saw M&A transactions decrease.
The United States enacted the Foreign Corrupt Practices Act of 1977 (FCPA) in response to concerns regarding pervasive bribery by US companies in foreign jurisdictions. In broad terms, the FCPA has made it illegal for certain companies to influence foreign officials to engage in corrupt activities. The FCPA applies to US companies, foreign companies that trade securities in the US, US citizens and US residents who engage in foreign corrupt practices, as defined in the FCPA, regardless of whether or not they are physically present in the US.
At the time of South Africa's transition to democracy, Clem Sunter, the scenario analyst, had a presentation which analysed South Africa's economic prospects in terms of a "high road" or a "low road": the high road leading to economic growth and improved prosperity and the low road leading to economic decline and stagnation. South Africa finds itself at a similar juncture today, with the nation facing choices that could have significant impact on the future economic path of the country.
2018 is set to be a year of an increased number of mergers and acquisitions in South Africa, driven by a more optimistic political climate and the potential for economic turnaround. The critical intersection between corporate governance and M&A is also likely to come under scrutiny, given the number of recent high profile corporate governance failures.
The business rescue (BR) provisions in Chapter 6 of the Companies Act (71 of 2008) have received a great deal of judicial attention. However, an area on which there has not been much focus at all is that of takeovers of companies that are in BR. How does an acquirer take control of such a company, and does a special regime apply given that the company is in BR? More particularly, this note is concerned with the scenario where there happens to be one or more recalcitrant or uncooperative minority shareholders of the BR company who do not wish to sell their shares, thereby precluding the acquirer from negotiating a "voluntary" purchase of 100% of the shares in the company. That is, how does one "squeeze out" shareholders of a company that is in BR?
The Competition Appeal Court' (the CAC) recently handed down judgment in Hosken Consolidated Investments & Tsogo Sun Holdings v the Competition Commission, where it found that the Competition Tribunal has the ability to issue declaratory orders on whether a merger must be notified to the Competition Commission or not.
Before business relationships are formalised, it is common for parties to first conclude a Memorandum of Understanding (MoU). What follows is a view on the general purpose of an MoU and an outline of important issues to consider when preparing one. Consideration is given to whether an MoU creates enforceable obligations.
A basic tenet is that taxpayers are entitled to arrange their affairs to minimise their tax exposure – but this must be done within the scope of the applicable legislation. Although tax considerations are an important aspect in any commercial transaction, the tax implications should not be the overriding factor that informs the transaction structure. This is particularly so in a global economy where transactions solely driven by the tax consequences will be subject to increased scrutiny. With the introduction of the Base Erosion and Profit Shifting (BEPS) project by the Organisation for Economic Co-operation and Development (OECD), taxpayers should be aware of the potential pitfalls in structuring their transactions solely to derive tax benefits.