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IN THE COMPANIES TRIBUNAL OF SOUTH AFRICA
Case no.: CT02759ADJ2026
In the ex parte application of:
EMERAUDE INTERNATIONAL SOUTH AFRICA (PTY) LTD Applicant
Presiding member:
Date of decision:
Richard Bradstreet
19 June 2026
DECISION (Reasons and Order)
INTRODUCTION
1. The Applicant is Emeraude International South Africa (Pty) Ltd, a private
company incorporated in terms of the laws of the Republic of South Africa
under registration number 2017/306266/07, with its registered office and
principal place of business at Ravago Place, Ground Floor, Turnberry Office
Park, 180 Cumberland Avenue, Bryanston, Gauteng.
2. This application is brought in terms of section 72(5) of the Companies Act 71
of 2008 (“the Act”), for an exemption from the requirement that the Applicant
have a Social and Ethics Committee (“SEC ”) (as required by section 72(4) of
the Act, read with reg 43 of the Companies Regulations 2011).
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3. The Applicant’s public interest score exceeded the statutory threshold of 500
in each of its 2024 and 2025 financial years, and that the Applicant is, prima
facie, a company to which regulation 43 applies. The Applicant contends,
however, that it is not reasonably necessary in the public interest to require it
to have a SEC, having regard to the nature and extent of its activities.
RELEVANT LAW
4. Section 72(4)(a) of the Act empowers the Minister to, by regulation, prescribe
“a category of companies that must each have a social and ethics committee,
if it is desirable in the public interest, having regard to – (i) annual turnover; (ii)
workforce size; or (iii) the nature and extent of the activities of such
companies”.
5. Regulation 43 applies to “( a) every state owned company; ( b) every listed
public company; and ( c) any other company that has in any two of the
previous five years, scored above 500 points in terms of regulation 26(2)” (reg
43(1)).
6. Regulation 26(2) requires that every company calculate its “public interest
score” at the end of each financial year, being the sum of the following:
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“(a) a number of points equal to the average number of employees of the company during
the financial year;
(b) one point for every R 1 million (or portion thereof) in third party liability of the company,
at the financial year end;
(c) one point for every R 1 million (or portion thereof) in turnover during the financial year;
and
(d) one point for every individual who, at the end of the financial year, is known by the
company-
(i) in the case of a profit company, to directly or indirectly have a beneficial interest in
any of the company's issued securities; or
(ii) in the case of a non-profit company, to be a member of the company, or a member
of an association that is a member of the company.”
7. In terms of regulation 43(2), “[a] company to which this regulation applies must
appoint a social and ethics committee unless – (a) it is a subsidiary of another
company that has a social and ethics committee, and the social and ethics
committee of that other company will perform the functions required by this
regulation on behalf of that subsidiary company; or ( b) it has been exempted
by the Tribunal in accordance with section 72(5) and (6).”
8. Regulation 43(5) sets out the functions of the SEC:
“(5) A social and ethics committee has the following functions-
(a) To monitor the company's activities, having regard to any relevant legislation, other
legal requirements or prevailing codes of best practice, with regard to matters
relating to-
(i) social and economic development, including the company's standing in terms
of the goals and purposes of-
(aa) the 10 principles set out in the United Nations Global Compact
Principles; and
(bb) the OECD recommendations regarding corruption;
(cc) the Employment Equity Act; and
(dd) the Broad-Based Black Economic Empowerment Act;
(ii) good corporate citizenship, including the company's-
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(aa) promotion of equality, prevention of unfair discrimination, and reduction
of corruption;
(bb) contribution to development of the communities in which its activities are
predominantly conducted or within which its products or services are
predominantly marketed; and
(cc) record of sponsorship, donations and charitable giving;
(iii) the environment, health and public safety, including the impact of the
company's activities and of its products or services;
(iv) consumer relationships, including the company's advertising, public relations
and compliance with consumer protection laws; and
(v) labour and employment, including-
(aa) the company's standing in terms of the International Labour Organization
Protocol on decent work and working conditions; and
(bb) the company's employment relationships, and its contribution toward the
educational development of its employees;
(b) to draw matters within its mandate to the attention of the Board as occasion
requires; and
(c) to report, through one of its members, to the shareholders at the company's annual
general meeting on the matters within its mandate.”
9. Section 72(5) of the Companies Act provides that the Tribunal may grant an
exemption if it is satisfied that either:
9.1. “the company is required in terms of other legislation to have, and does
have, some form of formal mechanism within its structures that
substantially performs the function that would otherwise be performed
by the social and ethics committee in terms of this section and the
regulations” (s 72(5)(a)); or
9.2. “it is not reasonably necessary in the public interest to require the
company to have a social and ethics committee, having regard to the
nature and extent of the activities of the company” (s 72(5)(b)).
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APPLICATION FOR EXEMPTION
10. The Applicant carries on business as a trader in polymer raw materials. It
sources those materials – in part from local producers, of which Sasol Limited
and Safripol (Pty) Ltd are named as two principal suppliers, and in part from
suppliers abroad – and on- sells them to manufacturers throughout Southern
Africa, who in turn convert them into a variety of plastic -based products. The
Applicant offers its customers a composite service of sourcing, importing and
delivering the raw material, but the logistics component of that service,
comprising importation and transport, is outsourced to specialist third parties.
11. The character of the business is accordingly that of an intermediary. The
Applicant neither manufactures the raw material it sells nor transforms it into
any finished product; on its own evidence it does not itself store the material.
Its profit is derived from a mark -up applied to materials sourced and resold,
the margin disclosed in the financial statements being of the order of six to
seven per cent. The carrying value of its assets is modest, being
approximately R1 million and consisting of the furniture, fittings and software
of its Bryanston office.
12. The Applicant’s staff complement is correspondingly small. It has two
directors and ten further employees, comprising the deponent (its head of
sales), two sales personnel, a financial manager, an administrative assistant,
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an office cleaner, and five operations specialists. Its issued securities are held
by a single shareholder, Emeraude International SAS, a French entity.
13. The Applicant’s public interest score was 535 for the 2024 financial year and
873 for the 2025 financial year. It is driven, overwhelmingly, by turnover (494
and 684 points respectively) and third- party liability (30 and 178 points), and
not by any large body of stakeholders.
14. The following considerations are material for the purposes of this application:
14.1. Emeraude is an intermediary. It sources polymer raw materials, in part
from local producers , and in part from abroad, and on- sells them to
manufacturers throughout Southern Africa. It does not manufacture,
transform or store the material, and outsources logistics to specialist
third parties.
14.2. It has a single shareholder, Emeraude International SAS (a French
entity), and twelve people in its employ, being two directors and ten
staff. Labour and employment -equity exposure is, at that scale,
negligible and is managed directly by management and the board. The
cost of appointing a further, independent director would be difficult to
justify.
14.3. Environmental responsibility for the material lies, substantially, with
those who produce it and those who convert it into finished goods.
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Although regulation 43(5)( a)(iii) reaches a company’s “products or
services” and not only its own operations, the scope for meaningful
environmental monitoring by a committee is narrow where, as here, the
company neither makes, transforms nor stores the polymer but acts as
a contractual conduit.
14.4. Consumer relationships do not arise: the Applicant sells only to
manufacturers, not to the public, and does not advertise.
14.5. Corruption engages the public interest most directly, the Applicant
being a foreign-owned importer; however, its sole shareholder imposes
and supervises strict anti -corruption policies binding on Emeraude and
its staff, breaches being reported to the board. That is an internal
discipline rather than a section 72(5)( a) mechanism, but in an
enterprise of twelve persons reporting to a board of two it addresses
the risk proportionately.
14.6. The Applicant does not participate in broad- based black economic
empowerment and conducts no activity within any identifiable
community; such social upliftment as it undertakes is driven by its
shareholder. With a single shareholder and few matters to monitor, the
residual reporting functions under regulation 43(5)(b) and (c) add little.
15. On a fair assessment, the matters a social and ethics committee exists to
monitor are, in the Applicant’s case, either absent or adequately addressed by
its existing management and shareholder structures. A proper case has
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accordingly been made out that it is not, at present, reasonably necessary in
the public interest to require the Applicant to have a SEC.
ORDER
16. It is accordingly ordered that:
a) the Applicant is exempted from being required to appoint a social and
ethics committee for a period of five (5) years from the date of this order, in
accordance with section 72(6); and
b) the Tribunal’s Recording Officer (Registrar) is directed to serve this order
on (i) the Applicant and (ii) the Commissioner of the Companies and
Intellectual Property Commission (CIPC).
Richard Bradstreet
Member of the Companies Tribunal
19 June 2026