South Africa—Cross-border insolvency under the Cross-Border Insolvency Act 42 of 2000

The following Restructuring & Insolvency practice note provides comprehensive and up to date legal information covering:

  • South Africa—Cross-border insolvency under the Cross-Border Insolvency Act 42 of 2000
  • Coronavirus (COVID-19)
  • The Cross-Border Insolvency Act 42 of 2000
  • Co-operation
  • Recognition of foreign proceedings
  • Local trustees seeking recognition in a foreign state
  • Payment in concurrent proceedings
  • Co-ordination of foreign proceedings

South Africa—Cross-border insolvency under the Cross-Border Insolvency Act 42 of 2000

Coronavirus (COVID-19)

This content is affected by the coronavirus (COVID-19) pandemic. For further details, take a look at our Coronavirus (COVID-19) toolkit and Practice Note: Coronavirus (COVID-19) Tracker of insolvency reforms globally [Archived]. For related news, guidance and other resources to assist practitioners working on restructuring and insolvency matters, see: Coronavirus (COVID-19)—Restructuring & Insolvency—overview.

The Cross-Border Insolvency Act 42 of 2000

The Cross-Border Insolvency Act 42 of 2000 (CBIA) seeks to regulate the position insofar as foreign trustees seeking to deal with assets in South Africa is concerned, as well as where a local trustee seeks to deal with assets situated in a foreign jurisdiction.

The difficulty with the CBIA is that it only applies in respect of any State which has been designated by the Minister by notice in the Gazette. Unfortunately, the Minister has at yet not designated any estates and as such the CBIA, while in force, has no parties that are bound to its provisions.

As such, parties are left to resort to the common law cross border insolvency provisions.

Section 2 of the CBIA provides that it will apply when:

  1. assistance is sought in the Republic by foreign court or foreign representative in connection with foreign proceedings

  2. assistance is sought in a foreign state in respect of South African insolvency proceedings

  3. foreign proceedings and local

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