• The Supreme Court of Appeal overturned a High Court decision and confirmed the liquidation of Regiments Capital, a decision initially opposed by various interested parties but supported by the South African Revenue Service (SARS).
• This ruling endorses the liquidators’ authority to unbundle significant share transactions and protect the proceeds’ distribution, under the ultimate supervision of the creditors and the Master of the High Court.
• SARS, represented by Commissioner Edward Kieswetter, demonstrated its ability to intervene decisively in corporate structuring matters and act in the overall interest of the tax base, reflecting its commitment to combating instances of state capture and regaining public trust.

Tshwane – The Supreme Court of Appeal (SCA) made a landmark ruling on the 18th of May, 2023, that the liquidation of Regiments Capital (Pty) Ltd and Others should proceed, overturning the decision of the High Court and affirming the stance of the South African Revenue Service (SARS)​.

Earlier, several parties with vested interests had sought the intervention of the courts to prevent the liquidation of Regiments. In an unexpected turn of events, SARS, led by Commissioner Edward Kieswetter, intervened in the matter, opposing the request to halt the liquidation. Despite SARS’ intervention, the High Court initially decided to set aside the liquidation process. This decision was contested by SARS and the liquidators, leading to an appeal in the Supreme Court​.

The Supreme Court, in its decision, set aside the High Court’s ruling and confirmed the liquidation of Regiments Capital. This judgment now puts the process of winding up the company, including the unbundling of its investments, firmly in the hands of the liquidators, under the ultimate supervision of the creditors and the Master of the High Court​.

The court’s proceedings established the authority to unbundle significant share transactions and protect the distribution of the proceeds. It also conclusively found that Regiments Capital was both factually and commercially insolvent, with no basis for finding that the continuation of its winding-up was unnecessary or undesirable​.

The successful appeal demonstrates the vigilance of SARS in monitoring corporate structuring, and its resolve to act firmly to protect the fiscus. The verdict underscores SARS’ capability to intervene in matters of significant financial importance and act in the overall interest of the tax base​.

Commenting on the Supreme Court’s ruling, Commissioner Kieswetter said, “The outcome of this complex and highly contested appeal reflects my undertaking, given at the start of my term, to act decisively and judiciously to combat instances of state capture and to regain public trust and confidence.” This victory marks a significant stride in SARS’ mission to protect public funds and uphold the rule of law​.