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Companies Act, 1973 (Act No. 61 of 1973)

Chapter VIII: Directors

Interests of Directors and Officers in Contracts

237. Disclosure by interested director or officer acting for company

 

 

1) A director or officer referred to in section 234(2)(b) who is in any way, whether directly or indirectly, materially interested in any proposed contract to be entered into by him on behalf of the company, shall, before entering into such contract, declare his interest and the full particulars thereof at a meeting of directors as prescribed by section 235, and shall not enter into such contract unless and until a resolution has been passed by the directors approving thereof.

 

2) Any such officer who becomes materially interested in any contract entered into by him on behalf of the company after it was entered into, shall forthwith declare his interest and the full particulars thereof by a written notice given to the directors.

 

3) A notice referred to in subsection (2) may be delivered to the secretary of the company, if the company has a secretary, and the secretary shall forthwith transmit it to the directors for whom it is intended.

 

4) Nothing in this section shall be taken to prejudice the operation of any rule of law restricting an officer of a company from having an interest in contracts with the company.

 

5) Any director or officer of a company who fails to comply with any provision of this section, shall be guilty of an offence.