| (1) | A municipality may, subject to subsection (2)— |
| (a) | establish or participate in the establishment of a private company in accordance with the Companies Act, 1973 (Act No. 61 of 1973); or |
| (b) | acquire or hold an interest in a private company in accordance with the Companies Act, 1973 (Act No. 61 of 1973). |
| (a) | A municipality may in terms of subsection (1)(a) or (b) either acquire or hold full ownership of a private company, or acquire or hold a lesser interest in a private company. |
| (b) | A municipality may acquire or hold such a lesser interest in a private company only if all the other interests are held by— |
| (i) | another municipality or municipalities; |
| (iii) | any combination of institutions referred to in subparagraphs (i) and (ii). |
| (c) | A municipality may, despite paragraph (b), acquire or hold an interest in a private company in which an investor other than another municipality or a national or provincial organ of state has an interest, but only if effective control in the private company vests in— |
| (ii) | another municipality; or |
| (iii) | that municipality and another municipality collectively. |
| (3) | If a municipality establishes a private company or acquires or holds an interest in such a company, it must comply with the Companies Act, 1973 (Act No. 61 of 1973), and any other law regulating companies, but if any conflict arises between that Act or such law and a provision of this Act, this Act prevails. |
[Section 86C inserted by section 18 of Act No. 44 of 2003]
