CRS Business Rescue

Welcome to the web site of Corporate Renewal Solutions that deals with the turnaround of financially distressed companies in terms of business rescue legislation as contained in Chapter 6 of the Companies Act No. 71 of 2008, amended by the Companies Amendment Act No. 3 of 2011, amplified by business rescue regulations as contained in the Companies Regulations, 2011, and reviewed in the King III business rescue recommendations.

For detail about the current implementation status of new legislation and regulations, see business rescue in South Africa.

In 1926 South Africa was the first country after the USA to have introduced business rescue legislation. Judicial management, however, proved to be ineffective and on 1 May 2011 was replaced with the business rescue provisions in Chapter 6 of the new company legislation.

Chapter 6 business rescue legislation represents a codification of the turnaround procedures followed in workout in the informal sector, but is designed to overcome a number of practical problems faced by workout, and to protect the interests of all stakeholders.  It comes with its own problems though, and financially distressed companies will always have to make the choice between informal turnaround (workout) and Chapter 6 turnaround (business rescue) based on the specific circumstances they face.

For more information, see business rescue versus workout.

That notwithstanding, new business rescue legislation implemented on 1 May 2011 represents an important new era in the South African turnaround industry with the potential of saving many more financially distressed but economically viable companies from liquidation.