Wednesday, 12 June 2024
22.7 C
Durban

CIPC changes deadline for SA businesses to comply with beneficial ownership

Home Manufacturing & Processing Quality Assurance CIPC changes deadline for SA businesses to comply with beneficial ownership

ALL South African companies and entities are required to submit beneficial ownership information to the CIPC (Companies and Intellectual Property Commission) within 30 days of their CIPC annual return being due or within ten days of incorporation from May this year. Companies are advised to meet this deadline to avoid falling foul of the new rules and risk penalties.

This is according to local startup InfoDocs, which has developed a simple way to file beneficial ownership. The specific deadline for a business’ beneficial ownership submission is available on InfoDocs.

Joshua Alexandre, InfoDocs founder and CEO, says, “Over 10,000 beneficial ownership declarations have already been submitted via InfoDocs this year. Most of these were submitted by professionals who help privately held businesses manage their CIPC compliance. However, InfoDocs has simplified the process to make it possible for anyone to submit their registers of beneficial owners, shareholders and disclosure forms, which are also known as beneficial ownership diagrams or organograms. All of these documents are automatically generated.”

New transparency rules could prevent another state capture

The beneficial owners are those individuals who ultimately own or control a company, directly or indirectly and are also referred to as those with beneficial interest. Although the Companies Act requires a share register of those who own or control 5% or more of legal entities,  the new laws provide greater transparency about ownership and control structures, which the CIPC will maintain in a central database. The intention is to avoid money laundering and combat terrorism financing.

Says Alexandre, “The consequences of not knowing who owns and controls companies in South Africa have been dire. Linking beneficial ownership for all companies and close corporations is an important step in preventing abuse, and avoiding further state capture in South Africa.”

Private companies (PTY), close corporations (CC), non-profits (NPC), and state-owned companies (SOC) all need to file beneficial ownership. Any individual or entity holding more than 5% beneficial ownership of a company or close corporation must submit a register of beneficial owners to CIPC. The beneficial interest in relation to a company’s securities is entitlement through ownership, agreement, relationship or otherwise.

Companies can access the online system directly on CIPC’s website, but can be put off by the complexity of the inefficient process and prefer to outsource the job to professionals. This can be a costly exercise and consequently over 72% of businesses are not compliant.

Professionals and SMEs use the InfoDocs system to add their company directly from CIPC, produce professional templates and store company records securely online.

“Cost is always important, but non-compliant companies run the risk of attracting penalties, legal fees and director liability. InfoDocs simplifies company secretarial services for directors and shareholders for less than R395 per company per year including a beneficial compliance submission.”

InfoDocs works closely with the CIPC, as the software aids the CIPC in meeting its mandate. To date, over 50,000 companies use InfoDocs to submit annual returns, maintain statutory registers and submit documents using high-quality document templates. The software sends alerts and notifications of submission deadlines. From the dashboard, companies can file returns and make secure payments directly to the CIPC.

Most Popular

WEG Africa pioneers local manufacture of MV softstarters

WEG Africa has become the first OEM to produce medium voltage (MV) softstarters in South Africa, reducing lead times for customers and supporting the...

Disruptions drive changes in global container port performance ranking

THE World Bank published the newest global Container Port Performance Index (CPPI) last week, noting that it reveals that east and southeast Asian ports...

SPONSORED NEWS: WEG Africa pioneers local manufacture of MV softstarters

WEG Africa has become the first OEM to produce medium voltage (MV) softstarters in South Africa, reducing lead times for customers and supporting the...

Workshop assists local clothing and textile SMEs

MORE than 40 small to medium-sized enterprises (SMEs) in the clothing, textile, footwear, and leather (CTFL) sector gathered for the KwaZulu-Natal Clothing & Textile...