by Karl Gribnitz

In 2015, Karl Gribnitz and Robert Appelbaum wrote a book called “Business Rescue and Compromise Offers”. The book is an analysis of Chapter 6 of the Companies Act, No. 71 of 2008 (as amended).

Business Rescue and Compromise Offers, 2015

In their book, they determined that, according to the law, there are a total of 354 obligations that must be adhered to during a business rescue event. The company and the practitioner are responsible for 309 of these obligations, in the event of voluntary business rescue as contemplated in Section 129 of the Act.

The Act requires that these obligations be completed in 45 business days, which is a hugely complex and time-sensitive task for a single practitioner. Effectively it means that the single practitioner must be involved with the business on a full-time basis for nearly three months and the cost of such a practitioner may become prohibitively expensive.

In addition, most practitioners do not want to engage in smaller business rescues as these businesses cannot afford their fees to justify their efforts.


The authors developed an expert report system, which evaluates the level of compliance required by law during a business rescue. These expert reports were developed using the methodology that is presented in their book, which effectively converts a set of instructions (law) into mathematics. These reports accurately measure the level of compliance during business rescue proceedings, thereby evaluating compliance down to the “letter of law”.

Using the expert reports to evaluate various cases done the “regular” way, it was found that compliance ranged from 32% to 70%. It was clear that practitioners were not always complying with the Act.

Some of these plans were drafted by law firms on behalf of practitioners and provided absolutely the minimum of information. Section 150(2) states:

The business rescue plan must contain all the information reasonably required to facilitate affected persons in deciding whether or not to accept or reject the plan …

In other words, if the plan lacked information it was not sufficient to protect the interests of the business or affected parties.


The successful completion of a business rescue is largely dependent on the competence of the appointed practitioner.

A practitioner should be financially literate (preferably a CA), and have access to a strong team of supporting functions including human resource specialists, process engineers, attorneys and project managers.

A practitioner that works with a multi-disciplinary team is more likely to have the business rescue plan adopted by the affected parties, and complete all the obligations in the prescribed time line with a high level of compliance.

For this reason, G&A Compass has assembled a group of professional independent associates to conduct business rescue proceedings in a ethical, efficient, effective and legal way.