Recent changes to the Companies Act could reduce the chances of creditors getting paid when debtors go into liquidation, Credit Guarantee warned.
Credit Guarantee said companies should ensure that they have enough insurance to cover credit sales, or risk not getting paid when debtors went bankrupt The warning, from one of South Africa's oldest credit insurance underwriting companies, comes in the wake of amendments to the Companies Act which give potential witnesses the right to refuse to answer potentially incriminating questions, pending a ruling by the prosecution authorities on whether they should be compelled to answer.
This could delay liquidations inquiries, making it more difficult to retrieve assets from an insolvent company's estate.
Credit Guarantee is the latest group to express concern about the change to the legislation that has sent shudders through liquidators in the country.
