Securities Services Act, 2004 (Act No. 36 of 2004)Chapter V : General Provisions Applicable to Self-Regulatory Organisations53. Demutualisation of self-regulatory organisation |
| (1) | A self-regulatory organisation which is not incorporated as a company having a share capital in terms of the Companies Act may convert to such a company with the approval of the registrar and subject to the conditions that the registrar may prescribe. |
| (2) | If a conversion referred to in subsection (1) takes place— |
| (a) | the self-regulatory organisation referred to in subsection (1) is deemed to be a company incorporated in terms of the Companies Act from a date determined by the registrar in consultation with the self-regulatory organisation; |
| (b) | the Registrar of Companies, appointed in terms of section 7 of the Companies Act, must register the memorandum and articles of association of the self-regulatory organisation in terms of section 63(1) of that Act on the date referred to in paragraph (a); |
| (c) | the continued corporate existence of the self-regulatory organisation from the date on which it was first licensed by the registrar is unaffected and any actions of the self-regulatory organisation before its conversion remain effectual; |
| (d) | the terms and conditions of service of employees of the self-regulatory organisation are not affected; |
| (e) | all the assets and liabilities of the self-regulatory organisation, including any insurance, guarantee, compensation fund or other warranty owned or maintained by the organisation to cover any liabilities of the authorised users or participants, as the case may be, to clients, remain vested in and binding upon the company or such other entity acceptable to the registrar as the company may designate; |
| (f) | the company has the same rights and is subject to the same obligations as were possessed by or binding upon the self-regulatory organisation immediately before its conversion; |
| (g) | all agreements, appointments, transactions and documents entered into, made, executed or drawn up by, with or in favour of the self-regulatory organization and in force immediately before the conversion remain in force and effectual, and are construed for all purposes as if they had been entered into, made, executed or drawn up by, with or in favour of the company, as the case may be; |
| (h) | any bond, pledge, guarantee or other instrument to secure future advances, facilities or services by the self-regulatory organisation which was in force immediately before the conversion remains in force, and is construed as a bond, pledge, guarantee or instrument given to or in favour of the company, as the case may be; |
| (i) | any claim, right, debt, obligation or duty accruing to any person against the self-regulatory organisation or owing by any person to such organisation is enforceable against or owing to the company, subject to any law governing prescription; |
| (j) | any legal proceedings that were pending or could have been instituted against the self-regulatory organisation before the conversion may be continued or instituted against the company, subject to any law governing prescription; and |
| (k) | the licence of the self-regulatory organisation remains vested in the company if the company complies with all the requirements of this Act in respect of a self-regulatory organisation. |