Page 6 - KZN Business Sense - Vol4 No1 - eBook

APPOINTING BUSINESS RESCUE PRACTITIONERS

Tasmiya Patel (Associate), Cox Yeats Regulations) regulate business Only those professional bodies,
Attorneys, Umhlanga Ridge rescue practitioners and the as well as juristic persons
qualifications required for a created by an Act of Parliament,
KEY CHANGES TO person to be appointed as a would be accredited by CIPC to
THE APPOINTMENT business rescue practitioner. have their members licensed as
PROCESS OF For a person to be eligible for business rescue practitioners.
BUSINESS RESCUE appointment (bearing in mind A deadline of 1 October 2017
PRACTITIONERS IN s138(1)(c) to (f) of the Act which was given for those professional
prohibits certain people from
bodies recognised by SAQA
TERMS OF NOTICE appointment as a business and juristic persons to apply
49 OF 2017 rescue practitioner) s138(1) of to CIPC for accreditation. In
usiness rescue was the Act requires prospective such applications, professional
introduced in Chapter business rescue practitioners to bodies and juristic persons
B6 of the Companies Act be members in good standing of had to show compliance with
71 of 2008 (the Act) as a new a legal, accounting, or business their professional rules and
corporate rescue mechanism management professional body disciplines to be able to accredit
to assist companies in South that is subject to regulation by their own members. Reception at Cox Yeats Attorneys
Africa who find themselves a regulatory authority, and that Therefore, in terms of this new
suffering from financial difficulty. is accredited by the Companies process, people will be now be rules and disciplines to be able to perfecting securities; offers
Business rescue provides and Intellectual Property licensed to act as business rescue license them. This new procedure of compromise, schemes of
distressed companies with Commission (CIPC). In addition practitioners through their is an attempt by CIPC to exercise arrangement and matters
temporary relief to allow for their to this, CIPC on application, is membership to their recognised tighter control over who can relating to the prevention of
rehabilitation. The successful also empowered to issue licenses and accredited professional be appointed to carry out the organised crime.
rescue of companies is key in to individual persons to practice bodies or their accredited juristic enormous and burdensome task Head of the Team, Thys
South Africa considering the high as business rescue practitioners. persons, provided that they of rescuing companies. CIPC, Scheepers says, “The Cox Yeats
unemployment rate and the large The Regulations require CIPC comply with the requirements to together with the accredited Insolvency & Business Rescue
number of businesses that are still to consider the qualifications be set down by their professional professional bodies and juristic Team carries out its work in
being liquidated. The effective and experience that are required bodies or juristic persons for persons will therefore play an keeping with the firm’s mission
rescue of companies is therefore for a person to be a member of a accreditation as a member. This integral role in ensuring that and ethos, which is to give the best
critical to the wellbeing of the specific professional body, as well shows that being a member in business rescue practitioners service to our clients. We always
communities that they operate in as that professional body’s ability good standing of a profession maintain the integrity of business view our relationships with our
and our economy as a whole. rescue proceedings and that,
to discipline its members. From subject to regulatory authority where possible, fewer companies clients as being long term and
A company can be placed into the above it is evident that there of either a professional body are liquidated. we invest time in understanding
business rescue in either of the is a certain degree of regulatory or juristic person is still key their various businesses challenges
following two ways: a resolution control over the appointment to prospective business rescue INSOLVENCY & to determine the most effective
adopted by a companies’ board process to ensure that suitably practitioners being licensed. BUSINESS RESCUE strategies to reduce adversity and
of directors in terms of s129 of qualified people are appointed to However, it is important to TEAM to allow for recovery.”
the Act; or a court application assist ailing companies. take note that Notice 49 still The Insolvency & Business
by an affected person in terms of It is important to note that makes provision for people who The Cox Yeats Insolvency Rescue Team consists of
s131 of the Act. Once a company in May 2017, CIPC introduced did not belong to a recognised & Business Rescue Team Partners Thys Scheepers (Head
is placed into business rescue, changes to the appointment professional body or juristic has extensive experience in of the Team), Callyn Wilkinson,
an independent person will be process which appears to further person before 1 October 2017, insolvency, business rescue, David Vlcek, and Nkosinathi
appointed as a business rescue regulate the appointment of to still act as business rescue schemes of arrangement and debt Gobhozi; Associate Tasmiya
practitioner, either by the board business rescue practitioners. practitioners. This provision is recovery and has represented Patel, and Candidate Attorney
of directors of the company This new method was first made by allowing people to still individuals, SMEs and large
or by a court, to oversee and introduced by CIPC in Notice bring individual applications to corporates in this regard. Craig Berrange. 
manage the process. One of the 30 of 2017 on 2 May 2017 which CIPC for conditional licenses to The team applies their
main duties of a business rescue was later withdrawn and replaced act in the capacity as a business commercial and legal Should you require assistance or advice
Insolvency & Business Rescue matters,
practitioner is to develop and with Notice 49 of 2017 (Notice rescue practitioner. expertise to provide assistance contact us on 031-5368500 or
implement a sound business 49) on 19 September 2017. with: liquidations and email tscheepers@coxyeats.co.za;
rescue plan that will either result This new regulatory method sequestrations; cross-border cwilkinson@coxyeats.co.za;
in the company continuing to In terms of Notice 49, all is in its beginning phase, with insolvencies; business rescue; dvlcek@coxyeats.co.za; ngobhozi@
exist on a solvent basis or will practitioners as well as aspiring work still to be done by CIPC in insolvency interrogations; coxyeats.co.za; tpatel@coxyeats.co.za;
provide a better return for the practitioners must belong to terms of accrediting professional or cberrange@coxyeats.co.za.
creditors or shareholders of either a legal, accounting or bodies and juristic persons,
the company than liquidation business management profession and thereafter by the accredited
proceedings would. recognised by the South African professional bodies and juristic
Qualifications Authority persons, in terms of ensuring
The Act and the Companies
Regulations 2011 (the (SAQA) or a juristic person that their members are in good
created by an Act of Parliament. standing and adhere to their

Thys Sheepers Callyn Wilkinson David Vlcek Nkosinathi Gobhozi Tasmiya Patel Craig Berrange
Partner, Team Leader Partner Partner Partner Associate Candidate Attorney

6