Abstract
This study critically evaluates the adequacy of shareholder protections in schemes of arrangement through a comparative analysis of South African and Australian company law. As schemes of arrangement become increasingly central to corporate restructuring, the balance between facilitating corporate efficiency and safeguarding minority shareholder rights requires closer scrutiny. Where substantive and procedural protections are insufficient or inaccessible, policy values such as fairness, transparency, and accountability may be compromised.
Drawing on South Africa’s Companies Act 71 of 2008 and Australia’s Corporations Act 50 of 2001, the study examines key protective mechanisms including shareholder approval thresholds, independent expert reports, class meetings, judicial oversight, and appraisal rights. The introduction of the Companies Act of 2008 in South Africa marked a conceptual shift from the Companies Act of 1973 framework. However, certain safeguards, particularly court intervention and appraisal remedy, remain difficult to invoke in practice. In contrast, Australia retains several protections that were repealed under South Africa’s current regime.
The study finds that South Africa’s system must address the complexity of available remedies and reveals that Australia’s protections are largely incompatible with South Africa’s regulatory context, offering minimal reform potential. Accordingly, the study recommends targeted reforms.