Navigating SA’s business compliance landscape in 2024: Companies Act and CIPC changes in full effect

Throughout 2023, South Africa's corporate landscape witnessed transformative updates, challenging the traditional methods of company registration and compliance. This guide offers clarity and direction for seamless navigation through the maze of 2023's Companies Act and CIPC (Companies and Intellectual Property Commission) updates. Whether you're looking to register a company or have an existing business in South Africa, we help you navigate the company registration compliance requirements under the new framework.

Issued by Company Partners

29 Jan 2024

Navigating SA’s business compliance landscape in 2024: Companies Act and CIPC changes in full effect

Disclaimer: The information provided in this guide is intended for general informational purposes only and should not be construed as legal advice. For specific advice regarding your company registration needs, please consult a qualified legal professional.

In this article we’ll explore these three main areas:

Beneficial ownership disclosure for new and existing business.
New company registration certificates: What's changed?
CIPC improved security for director amendments

Tightened AML/CFT requirement of 2023

The battle against financial crime has intensified, with the South African government placing rigorous emphasis on anti-money laundering (AML) and combating terrorism financing (CFT) in company registration and annual reporting processes. Subsequent to being greylisted.

Failure to comply with the updated AML/CFT requirements can result in severe consequences, including hefty fines or the de-registration of your business. This stringent approach underscores the government's commitment to eradicating financial crimes. Thus, making it imperative for businesses to ensure the correct information and documents are submitted when doing company registration in South Africa.

The first step implemented by CIPC towards these new regulations is the Beneficial ownership disclosure.

As of April 2023, businesses undergoing company registration in South Africa are mandated to adhere to stricter reporting obligations. This encompasses the disclosure of beneficial ownership (BO) information to CIPC within 10 days after you register a business.

Navigating the new BO regulations is no walk in the park. Don't risk costly fines or delays – partner with an experienced company registration service provider like Company Partners! They'll handle complex regulations like share registers, beneficial ownership declarations, and CIPC reporting, leaving you free to focus on your business.

Furthermore, to the above-mentioned changes for new company registration, on 11 December 2023, CIPC also started rolling out changes to incorporate the Beneficial Ownership Declaration when filing annual returns. It will be implemented in phases across the different channels on which annual returns are filed – starting with e-services and expected to be mandatory on all channels by 1 April 2024.

For more information about beneficial ownership – click here.

New company registration certificates: What's changed?

On November 6, 2023, CIPC announced changes to the company registration certificate format to guarantee the accuracy and reliability of documentation. These changes have caused a substantial change in the new company registration certificates' structure.

The new sequences and format of the company registration documents are as follows:

Welcome letter is found on page 1.
CoR14.3 – registration certificate is contained on page 2.
Memorandum of Incorporation (MOI) is on page 3 with only one of the incorporators details on the page.
The remainder of the MOI is captured on pages 4 to 8.
Disclosure certificate of the registered business is on page 9 and 10.

The revamped certificate now excludes the traditional "(PTY) LTD" abbreviation following the company name in some instances.

This modification, while subtle, is crucial for businesses to note, as it affects the representation and identification of their legal entity.

Multi-factor authentication for director amendments

In a world where digital security is paramount, the CIPC has introduced multi-factor authentication for filing director amendments on 4 December 2023. This added layer of security is a robust measure against fraudulent activities, ensuring the integrity of director amendments in company registration.

The enhanced security offers data integrity and information security for registered businesses on the CIPC database.

Below we outline the features of the updated authentication process:

No manual processing of director amendments and directors contact details, only automated processes available to finalise a transaction(s).
Identity card (filer and director(s)) issue date is now being verified against Department of Home Affairs (DHA). CIPC has no control over mismatch of identification issue dates from DHA on the issued card/book versus the records held at the DHA.
OTP verification is required from the filer and the directors impacted by the changes, i.e. appointments and resignations.
It is critical that the filer ensures that the email and cellphone number of the impacted directors are correct and up to date before filing a director amendment.

Beyond the headlines:

These are just some of the most significant changes to company registration and compliance processes as announced by CIPC in 2023. It's important to stay informed about updates and clarifications issued by CIPC throughout the year. Remember, consulting with an expert, like Company Partner, is always recommended for navigating complex company registration and compliance processes when starting a business in South Africa.

For further assistance with company registration, compliance, or understanding the nuances of these regulatory changes, contact Company Partners (Pty) Ltd. Our team of experts is equipped to guide you through every step to register a company and stay compliant in 2024.