To provide effective mechanisms for dealing with cases of cross-border insolvency; and to amend the Insolvency Act, 1936, so as to further regulate the jurisdiction of the High Courts; and to provide for matters connected therewith.
'Republic' means the Republic of South Africa.
creditors or other interested persons in a foreign State have an interest in requesting the commencement of, or participating in, proceedings under the laws of the Republic relating to insolvency.
Subject to paragraph (b) , this Act applies in respect of any State designated by the Minister by notice in the Gazette.
The Minister may only designate a State as contemplated in paragraph (a) if he or she is satisfied that the recognition accorded by the law of such a State to proceedings under the laws of the Republic relating to insolvency justifies the application of this Act to foreign proceedings in such State.
The Minister may at any time by subsequent notice in the Gazette withdraw any notice under subsection (2) (a) , and thereupon any State referred to in such lastmentioned notice ceases to be a foreign State for the purposes of this Act.
Any notice referred to in subsection (2) (a) or (3) must, before publication in the Gazette , be approved by Parliament.
Where the Minister withdraws a notice in terms of subsection (3), such withdrawal does not affect any pending legal proceedings and such proceedings must continue as if the notice had not been withdrawn.
[Sub-s. (5) added by s. 30 of Act 55 of 2003.
of the Constitution of the Republic of South Africa, 1996 (Act 108 of 1996), the requirements of the treaty or agreement prevail.
The functions referred to in this Act relating to recognition of foreign proceedings and cooperation with foreign courts must be performed by a High Court referred to in section 166 (c) of the Constitution of the Republic of South Africa, 1996 (Act 108 of 1996).
A trustee, liquidator, judicial manager, curator of an institution, or receiver is authorised to act in a foreign State in respect of proceedings under the laws of the Republic relating to insolvency, as permitted by the applicable foreign law.
Nothing in this Act prevents the court from refusing to take an action governed by this Act if the action would be manifestly contrary to the public policy of the Republic.
Nothing in this Act limits the power of a court or a trustee, liquidator, judicial manager, curator of an institution, or receiver to provide additional assistance to a foreign representative under other laws of the Republic.
In the interpretation of this Act, regard is to be had to its international origin and to the need to promote uniformity in its application and the observance of good faith.
A foreign representative may apply directly to a court in the Republic for relief.
The sole fact that an application pursuant to this Act is made to a court in the Republic by a foreign representative does not subject the foreign representative or the foreign assets and affairs of the debtor to the jurisdiction of the courts of the Republic for any purpose other than the application.
A foreign representative may apply to commence proceedings under the laws of the Republic relating to insolvency if the conditions for commencing such proceedings are otherwise met.
Upon recognition of foreign proceedings, the foreign representative may participate in proceedings regarding the debtor under the laws of the Republic relating to insolvency.
Subject to subsection (2), foreign creditors have the same rights regarding the commencement of, and participation in, proceedings under the laws of the Republic relating to insolvency as creditors in the Republic.
Subsection (1) does not affect the ranking of claims in proceedings under the laws of the Republic relating to insolvency, except that the claims of foreign creditors may not be ranked lower than non-preferent claims.
Without derogating from the application of the law and practice of the Republic generally, the ranking of claims in respect of assets in the Republic is regulated by the law and practice of the Republic on the ranking of claims.
Whenever under the laws of the Republic relating to insolvency notification is to be given to creditors in the Republic, such notification must also be given to the known creditors that do not have addresses in the Republic.
The court may order that appropriate steps be taken with a view to notifying any creditor whose address is not yet known.
Such notification must be made to the foreign creditors individually, unless the court considers that, under the circumstances, some other form of notification would be more appropriate.
No letters rogatory or other similar formality is required.
contain any other information required to be included in such a notification to creditors pursuant to the law of the Republic and the orders of the court.
A foreign representative may apply to the court for recognition of the foreign proceedings in which the foreign representative has been appointed.
in the absence of evidence referred to in paragraphs (a) and (b) , any other evidence acceptable to the court of the existence of the foreign proceedings and of the appointment of the foreign representative.
An application for recognition must also be accompanied by a statement identifying all foreign proceedings in respect of the debtor that are known to the foreign representative.
The court may require a translation of documents supplied in support of the application for recognition into an official language of the Republic.
If the decision or certificate referred to in section 15 (2) indicates that the foreign proceedings are proceedings within the meaning of section 1 (g) and that the foreign representative is a person or body within the meaning of section 1 (h) , the court may so presume.
The court may presume that documents submitted in support of the application for recognition are authentic, whether or not they have been legalised.
as foreign non-main proceedings if the debtor has an establishment within the meaning of section 1 (c) in the foreign State.
the application has been submitted to a court.
An application for recognition of foreign proceedings must be decided upon at the earliest possible time.
The provisions of this section and of sections 15, 16 and 18 do not prevent modification or termination of recognition if it is shown that the grounds for granting it were fully or partially lacking or have ceased to exist.
any other foreign proceedings regarding the same debtor that become known to the foreign representative.
any relief mentioned in section 21 (1) (c) , (d) and (g).
An order issued under subsection (1) must be dealt with as contemplated in section 17 of the Insolvency Act, 1936 (Act 24 of 1936), or section 357 (1) and (4) of the Companies Act, 1973 (Act 61 of 1973), as the case may be.
Unless extended under section 21 (1) (f) , the relief granted under this section terminates when the application for recognition is decided upon.
The court may refuse to grant relief under this section if such relief would interfere with the administration of foreign main proceedings.
section 21 of the Insolvency Act, 1936 (Act 24 of 1936), applies with regard to assets situated in the Republic to the same extent as it would have if the debtor had been sequestrated by a court.
The scope, and the modification or termination, of the stay and suspension referred to in subsection (1) are subject to sections 20, 23 and 75 of the Insolvency Act, 1936, and sections 341 and 359 of the Companies Act, 1973 (Act 61 of 1973), and the court may, at the request of the foreign representative or a person affected by subsection (1), modify or terminate the scope of the stay and suspension.
Subsection (1) (a) does not affect the right to commence individual actions or proceedings to the extent necessary to preserve a claim against the debtor.
Subsection (1) does not affect the right to request the commencement of proceedings under the laws of the Republic relating to insolvency or the right to file claims in such proceedings.
Upon recognition of foreign proceedings, whether main or non-main, the court may, at the request of the foreign representative, entrust the distribution of all or part of the debtor's assets located in the Republic to the foreign representative or another person designated by the court, provided that the court is satisfied that the interests of creditors in the Republic are adequately protected.
In granting relief under this section to a representative of foreign non-main proceedings, the court must be satisfied that the relief relates to assets that, under the law of the Republic, should be administered in the foreign non-main proceedings or concerns information required in those proceedings.
Without derogating from the application of the laws of the Republic generally, in granting relief under this section the court must indicate the laws of the Republic relating to the administration, realisation or distribution of a debtor's estate in the Republic that will apply.
granting any additional relief that may be available to a trustee, liquidator, judicial manager, curator of an institution, or receiver under the laws of the Republic.
In granting or denying relief under section 19 or 21, or in modifying or terminating relief under subsection (3), the court must be satisfied that the interests of the creditors and other interested persons, including the debtor, are adequately protected.
The court may subject relief granted under section 19 or 21 to conditions it considers appropriate.
The court may, at the request of the foreign representative or a person affected by relief granted under section 19 or 21, or of its own motion, modify or terminate such relief.
Upon recognition of foreign proceedings, the foreign representative has standing to initiate any legal action to set aside a disposition that is available to a trustee or liquidator under the laws of the Republic relating to insolvency.
When the foreign proceedings are foreign non-main proceedings, the court must be satisfied that the legal action relates to assets that, under the law of the Republic, should be administered in the foreign non-main proceedings.
Upon recognition of foreign proceedings, the foreign representative may, provided the requirements of the law of the Republic are met, intervene in any proceedings in which the debtor is a party.
In matters referred to in section 2 (1), the court shall cooperate to the maximum extent possible with foreign courts or foreign representatives, either directly or through a trustee, liquidator, judicial manager, curator of an institution, or receiver.
The court may communicate directly with, or request information or assistance directly from, foreign courts or foreign representatives.
In matters referred to in section 2 (1), a trustee, liquidator, judicial manager, curator of an institution, or receiver must, in the performance of his or her or its functions and subject to the supervision of the court, cooperate to the maximum extent possible with foreign courts or foreign representatives.
The trustee, liquidator, judicial manager, curator of an institution, or receiver may, in the performance of his or her or its functions and subject to the supervision of the court, communicate directly with foreign courts or foreign representatives.
coordination of concurrent proceedings regarding the same debtor.
After recognition of foreign main proceedings, proceedings under the laws of the Republic relating to insolvency may be commenced only if the debtor has assets in the Republic.
The effects of such proceedings are restricted to the assets of the debtor that are located in the Republic and, to the extent necessary to implement cooperation and coordination under sections 25, 26 and 27, to other assets of the debtor that, under the law of the Republic, should be administered in those proceedings.
in granting relief or in extending or modifying relief granted to a representative of foreign non-main proceedings, the court must be satisfied that the relief relates to assets that, under the law of the Republic, should be administered in the foreign non-main proceedings or concerns information required in those proceedings.
if, after recognition of foreign non-main proceedings, other foreign non-main proceedings are recognised, the court must grant, modify or terminate relief for the purpose of facilitating coordination of the proceedings.
In the absence of proof to the contrary, recognition of foreign main proceedings is, for the purpose of commencing proceedings under the laws of the Republic relating to insolvency, proof that the debtor is insolvent.
Without prejudice to secured claims or rights in rem , a creditor who has received part payment in respect of his or her or its claim in proceedings pursuant to a law relating to insolvency in a foreign State may not receive a payment for the same claim in proceedings under the laws of the Republic relating to insolvency regarding the same debtor, so long as the payment to the other creditors of the same class is proportionately less than the payment the creditor has already received.
33 [S. 33 repealed by s. 47 of Act 42 of 2001.
This Act is called the Cross-Border Insolvency Act, 2000, and comes into operation on a date fixed by the President by proclamation in the Gazette.