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Companies Amendment Bill in the Pipeline

May 20, 2021

Department of Trade, Industry and Competition

A Draft Companies Amendment Bill is in the pipeline.

The trade, industry and competition minister, Ebrahim Patel, announced this in the department’s 2021/22 Budget Vote Speech in parliament.

The minister added that the draft bill, to be prepared over the next three months, will set out the modalities for improved representation of worker interests in company decision-making and boards.

Other actions planned over the year include:

• Register of worker ownership in the local economy to be published on an annual basis – to work with unions and corporates to improve the funding arrangements to ensure that the model provides for real ownership and a greater say in decision-making;
• Practice Note under the B-BBEE Act gazetted to provide guidance to regulators and clarity in the market on the treatment of broad-based empowerment vehicles, so that worker ownership schemes, community trusts and union investment vehicles are properly recognised for BEE-purposes;
• Expert panel to be appointed to review the current BEE Framework to improve reporting;
• Competition Commission to launch a Market Inquiry into online platforms such as e-commerce market places, food delivery, short-term accommodation and travel e-platforms – a report on the state of economic concentration in SA industry to be released in 2021;
• Policy Statement on Competition Policy for Jobs to be released;
• Green Paper on the Social and Solidarity Economy to be released for public comment within 60 days – amendment to company law is required to tackle the gross injustice of excessive pay;
• New draft bill to be finalised within 60 days – require disclosure of wage differentials in companies, stronger governance on excessive director pay, and enhanced transparency on ownership and financial records;

As regards Master Plans going forward, the minister indicated that the department will look at Plans that support growth in new economic sectors as well as consolidating existing sectors.

In 2021, new sector work includes global business services, film animation, the chemical and plastic sectors, green industry, medical products and capital goods.

The minister also announced that a Draft Auto Green Paper on the Advancement of New Energy Vehicles in South Africa has been released.

The Draft Green Paper outlines a proposed roadmap to local production, options under consideration by auto-makers, unions and government and tentative timeframes.

In a statement, the department called for comment on the Draft Green Paper until 4 June 2021.

The department pointed out that the aim of the Draft Green Paper is to “establish a clear policy foundation that will enable the country to coordinate a long-term strategy that will position South Africa at the forefront of advanced vehicle and vehicle component manufacturing”.

The Draft Green Paper seeks to develop a framework upon which a comprehensive and long-term automotive industry transformation plan on new energy vehicles can emerge.

It focuses on, inter alia, creation of a high-yielding business environment, including an appropriate fiscal and regulatory framework, that makes South Africa a leading and a highly competitive location, not only within Africa but globally, for electric vehicle production; support and investment in the expansion and development of new and existing manufacturing plants to support the production of new energy vehicles and components within South Africa and to grow the level of employment in the sector; development and investment in new energy vehicle component technology and expansion of the fledgling electric supply chain, by increasing support and investment in a set of unique NEV components; reinvestment and support towards reskilling and upskilling of the workforce to ensure the right skills are available for the design, engineering and manufacturing of electric vehicles and related components and systems and adopting cleaner fuel technologies in South Africa.