Wednesday, March 06, 2013

“The statistics indicate fewer court orders against people unable to service their debt. This suggests that the financial standing of consumers seems to be improving as is their ability to handle debt,” said Harris.
The trend with insolvencies has been downward for some time. At the peak of the financial crisis there were 6 078 insolvencies for 2009, 3 536 for 2011, and 2 928 for 2012.
However, where companies are concerned, the number of liquidations in January 2013 was 22.5% higher year-on-year than in January 2012. Stats SA said the surge was due to voluntary liquidations which increased by 74.1%, with 103 more liquidations.
A compulsory liquidation takes place when a company or close corporation is wound up by an order of the court when liabilities exceed assets, or the entity is unable to pay its debts as and when they fall due for payment. A voluntary liquidation happens when a company resolves of its own accord to wind up its affairs.
On reasons for the year-on-year increase in voluntary liquidations, Harris commented: “This trend is concerning, and appears to be contrary to the trend-line which we have been tracking for some time. We have for the last while factored into the equation the increasing usage of the relatively new business rescue mechanisms, and I will be disappointed if this is the gilt wearing off the business rescue gingerbread”.
The Stats SA figures are available at: http://www.statssa.gov.za/Publications/statsdownload.asp?PPN=P0043&SCH=5438

Bowman Gilfillan Africa Group is a pan-African legal services group which provides top end, integrated legal advice to businesses, financial institutions and governments operating throughout Africa.

The Group has 350 lawyers in offices in Cape Town, Dar es Salaam, Johannesburg, Kampala and Nairobi. Udo Udoma & Bela-Osagie, the Group’s relationship law firm in Nigeria, has offices in Lagos, Abuja and Port Harcourt. Bowman Gilfillan Africa Group also have strong relationships and work closely with law firms across the rest of Africa which enables the Group to provide or source the advice clients require in any African country, whether on a single country or a multi-jurisdictional basis.

In addition to its continental reach, the Bowman Gilfillan Africa Group has close working relationships with law firms in UK, Hong Kong and US. This global reach, together with strong regional and international partners, creates a unique pan-African legal services group that can provide seamless professional services to multinational and local clients.

Focusing primarily on corporate law, commercial law and financial law, the Bowman Gilfillan Africa Group facilitates cross-border legal services of the highest global standards in Africa.