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Companies Act, 2008 (Act No. 71 of 2008)

Chapter 1 : Interpretation, Purpose and Application

Part A : Interpretation

3. Subsidiary relationships

 

 

1) A company is—
a) a subsidiary of another juristic person if that juristic person, one or more other subsidiaries of that juristic person, or one or more nominees of that juristic person or any of its subsidiaries, alone or in any combination—
i) is or are directly or indirectly able to exercise, or control the exercise of, a majority of the general voting rights associated with issued securities of that company, whether pursuant to a shareholder agreement or otherwise; or
ii) has or have the right to appoint or elect, or control the appointment or election of, directors of that company who control a majority of the votes at a meeting of the board; or
b) a wholly-owned subsidiary of another juristic person if all of the general voting rights associated with issued securities of the company are held or controlled, alone or in any combination, by persons contemplated in paragraph (a).

 

2) For the purpose of determining whether a person controls all or a majority of the general voting rights associated with issued securities of a company—
a) voting rights that are exercisable only in certain circumstances are to be taken into account only—
i) when those circumstances have arisen, and for so long as they continue; or
ii) when those circumstances are under the control of the person holding the voting rights;
b) voting rights that are exercisable only on the instructions or with the consent or concurrence of another person are to be treated as being held by a nominee for that other person; and
c) voting rights held by—
i) a person as nominee for another person are to be treated as held by that other person; or
ii) a person in a fiduciary capacity are to be treated as held by the beneficiary of those voting rights.

 

3) For the purposes of subsection (2), ‘hold’, or any derivative of it, refers to the registered or direct or indirect beneficial holder of securities conferring a right to vote.