Chinese companies are searching the globe for technology. A recent court judgment in South Africa means that exchange control approval for the export of intellectual property from the country is no longer required.
In March, the Supreme Court of Appeal ruled in the case of Oilwell (Pty) Ltd v Protec International Ltd & Others on the issue of the assignment of IP from a South African resident or entity to a non-resident or foreign entity. In particular, the court ruled on whether approval under regulation 10(1)(c) of the Exchange Control Regulations is required for such transactions.
Regulation 10(1)(c) imposes restrictions on the export of capital and states that “no person shall, except with permission granted by the Treasury and in accordance with such conditions as the Treasury may impose … enter into any transaction whereby capital or any right to capital is directly or indirectly exported from the Republic”.
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Vicky Stilwell is a director at Edward Nathan Sonnenbergs
150 West Street
Tel: +27 11 269 7400
Fax: +27 21 269 7899