The Acting Deputy Director-General of Consumer and Corporate Regulation at the Department of Trade and Industry (the dti), Mr MacDonald Netshitenzhe says Alternative Dispute Resolution mechanism should be made accessible to communities across the country.

Netshitenzhe was addressing delegates who attended a seminar aimed at promoting a culture of resolving commercial disputes through the Alternative Dispute Resolution (ADR). The seminar was hosted by the Companies Tribunal at the Gallagher Convention Centre in Midrand on 17 February.

“As policy makers in South Africa we are grappling with the challenge of promoting equitable, inclusive and sustainable economic growth. One of the ways of achieving such economic growth is through the creation of a fair regulatory environment that enables the development of investment, trade and enterprise in an equitable and sustainable manner,” said Netshitenzhe.

He added that the main purpose of the Companies Act of 2008 was to promote the development of the South African economy by encouraging entrepreneurship and enterprise efficiency, creating flexibility and simplicity in the formation and maintenance of companies, as well as encouraging transparency and high standards of corporate governance.

“The Companies Tribunal was established in terms of the Companies Act as a way of encouraging high standards in corporate governance by promoting ethical business practices. But taking into consideration the country’s history it was also established to ensure that redress mechanisms are made available to ordinary citizens and to reduce the cost of doing business by providing an informal, speedy and cost effective mechanism of resolving company disputes. It is important that all of the country’s citizens have access to this mechanism. It is critical that we make it easy for ordinary people across the country to access it and benefit from it,” emphasised Netshitenzhe.

Section 166 of the Companies Act of 2008 provides for the resolution of disputes by the Companies Tribunal through alternative dispute resolution, that is mediation, conciliation and arbitration.

The establishment of the Companies Tribunal as a forum for Alternative Dispute Resolution (ADR) is guided by section 34 of the Constitution of the Republic of South Africa, 1996, which guarantees everyone the right to have any dispute resolved by the application of the law decided in a fair public hearing before a court or, where appropriate, another independent Tribunal or forum.

Netshitenzhe called upon the business community and members of the public to utilise the ADR services which are provided at no costs to the parties.

The use of ADR is important in the commercial environment as it helps to preserve business relations that are key to the management, operation and sustainability of businesses and thus safeguard jobs that may otherwise be lost when businesses fails to resolve their disputes.

“The use of ADR contributes to economic growth as it provides investors with confidence that disputes will be resolved speedily and cost effectively and not negatively impact on productivity. Mediation, conciliation and arbitration can be used, not only as a dispute resolution mechanism, but as a management tool to promote good corporate governance by managing risk particularly financial and reputational risk associated with litigation,” stressed Netshitenzhe.