I hope this email finds everyone reflecting on a positive summer season and that your preparations for winter are on track.
Since the AGM in February, Exco has been busy preparing responses to government documents, attending meetings with relevant stakeholders and co-ordinating inputs on the way forward by our members.
There have been a number of positive developments in particular the attitude of officials at the Department of Agriculture, Forestry and Fisheries (DAFF) has been heartening. It is apparent that they are aware of many of the challenges we face and have initiated internal processes and inter-departmental discussions in order to find solutions.
One of the big positives that came from our interaction with DAFF is their willingness to give formal recognition to the Tilapia Aquaculture Association of South Africa (TAASA). However, for this to become a reality TAASA will have to register as a legal entity. To see the formal request from DAFF please click here http://www.thetilapiasite.co.za/file_list.php
Voluntary associations such as TAASA that need to obtain the status of a legal entity, generally do so in terms of Section 21 of the Companies Act, that provides for the incorporation of "Associations not for Gain". This route was also recommended to us by DAFF officials during our discussions.
There are probably two questions one can ask in this regard: why is it necessary and what are the implications for members?
As far as government and DAFF in particular is concerned, the registering of TAASA as a Section 21 company gives them the assurance that proper corporate governance procedures will be followed and that any public funds that may flow to the association will be properly accounted for.
As far as our members are concerned, they will benefit from knowing that TAASA is managed in accordance with the stipulations of the Companies Act. Some of the other important implications are listed below:
- A company is a juristic (i.e. artificial) person. This means that it exists in law as a separate entity, distinct from its members or officers or any third party. It means also that its assets and liabilities (and its profits and losses) are its own and do not belong to, say, its members; that it can sue and be sued in its own name; and that it has perpetual succession, ie: changes in its membership or in its board of directors do not effect its continuing existence.
- Section 21 of the Companies Act provides for the incorporation of "Associations not for Gain", commonly referred to as Section 21 companies. These companies do not have a share capital. In other words, a Section 21 Company cannot issue shares and cannot pay dividends to its members; instead it is "limited by guarantee", which means that its members undertake to pay a purely nominal amount (usually only a few rand) in the event of the Company failing or being placed in liquidation.
- The main object (as set out in the company's founding documents, called the Memorandum and Articles of Association) must involve : "promoting religion, arts, sciences, education, charity, recreation, or any other cultural or social activity or communal or group interests".
In terms of our constitution (section 3.1) TAASA is not a legal entity. It is therefore necessary to amend the constitution to make provision for the registration of TAASA as a section 21 company. These changes will affect the following areas of the constitution.
Legal Status of the Association
- The Tilapia Aquaculture Association of South Africa shall be registered with, and obtain a certificate of incorporation from, the Registrar of Companies ( to replace 3.1).
- All income and property of the company must be applied solely towards the promotion of its main object, and no amount or asset may be awarded or distributed to its members or directors in the form of profits or dividends or in any other way (to be included as 6.4).
- If any surplus (or "profit") remains on the winding up of the company, this surplus must be transferred to another institution having similar purposes, or otherwise in accordance with the instructions of the High Court (to be included as 6.5).
As these changes are necessary for us to start formalising the role TAASA can play in the development of freshwater aquaculture, we ask that you give careful consideration to this.
TAASA’s exco is of the view that this move, although more onerous on us in terms of the statutory requirements we will have to fulfil as a section 21 company, is a necessary one if we wish to see this sector developed to its full potential.
We therefore request permission to change the constitution to incorporate the changes detailed above. We also ask that those members who are against this change or have other concerns related to the above, enter into correspondence with us, via email at email@example.com
Please note, it will be our understanding that if we do not receive any correspondence that you are in favour of this change.
All correspondence in this regard needs to reach us by no later than 30 April 2013 (14 days). Thereafter we will inform members of the way forward.
We trust that you will find the above in order.
(on behalf of Exco)