Email signature compliance and the new Companies act

The provisions of section 32 of the new Companies Act, which addresses the use and publication of a company’s name, provide for similar obligations to those imposed under the previous Companies Act, 1978, with the notable exception of the requirements for including directors’ names and nationalities in business letters and business emails.

Both new and previous Acts require that a company’s name and registration number be mentioned in legible characters in all notices and other official publications of the company, including notices or other official publications in electronic format. The requirement extends to all bills of exchange, promissory notes, endorsements, cheques, and orders for money and goods purporting to be signed by or on behalf of the company in all letters, delivery notes, invoices, receipts, and letters of credit of the company.

However, the new Act does not include the requirement contained in section 171 of the previous Act, which obliged companies to incorporate and display the full names and nationalities of each of its directors on trade catalogues, trade circulars and business letters of the company.

The provisions of the previous Act meant that companies were required to include the names of its directors (or a link to its website on which these names were listed) on all business email correspondence, which in general practice are included in a corporate email signature.

While this requirement is not provided for under the new Act, our view is that the exclusion was an oversight that could be corrected in an amendment to the new Act. We, therefore, would advise companies still to display the initials and surnames of all directors and the nationalities of any non-South African directors on all business letters, trade catalogues and trade circulars, including those in electronic format wherein a link to the company website containing this information would suffice.

By failing to comply with this requirement, should the relevant section in the new Act be amended, companies may be faced with compliance issues.

By Preeta Bhagattjee, Director and Head of the National Telecommunications, Media and Telecommunication Practice and Simone Gill, Director ofTMT and Victor Omoighe, Candidate Attorney, TMT, at Cliffe Dekker Hofmeyr.