Companies now have 10 business days to file changes to their corporate information
On 24 May 2023, the Minister of Trade, Industry and Competition published the Companies Amendment Regulations, 2023 (Amendment Regulations). The Amendment Regulations were drafted in consultation with the Companies and Intellectual Property Commission (CIPC) to align the Companies Regulations with the General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act, 2022 (General Laws Amendment Act). The General Laws Amendment Act amended four pieces of legislation, including the Companies Act, 2008 (Companies Act), in an effort to avoid or help overcome grey-listing.
The amendments to the Companies Act and the Companies Regulations aim to ensure that the South African authorities have access to complete and accurate information in relation to South African companies.
Among other changes, the Amendment Regulations create new requirements for “affected companies” to disclose beneficial ownership information to the CIPC. They create additional obligations in relation to companies’ annual return filings.
Annual return filings require a company or external company to file basic information, including its turnover in the previous financial year, with the CIPC annually, along with a prescribed fee. Previously, companies and external companies were required to file changes to their corporate information (such as the company name and registered office address) with their annual return filing, if the relevant information no longer matched the CIPC’s existing records at the time the annual return was submitted. In other words, companies needed to update their information at least annually. The Amendment Regulations now create stricter requirements in relation to the timing of these filings with the CIPC.
The new Regulation 30(7A) states that companies and external companies are, at all times, required to submit a prescribed form or written notice, together with the supporting documentation prescribed by the CIPC, regarding changes to the following information:
- the name of the entity;
- the legal type and status of the entity;
- the address of the registered office of the entity;
- the memorandum of incorporation or other similar constitutional or founding documents of the entity;
- the full names of the directors (including the foreign directors of an external company), on or within 10 business days of the change being effected.
It has always been good practice to file any amendments to an entity’s information as soon as possible after the change is made. However, the new Regulation 30(7B) confirms that any failure to file updated information within the 10 business day period constitutes non-compliance by the company or external company with the Companies Act and the Companies Regulations. It is not yet clear how active the CIPC will be in enforcing the new timelines. In cases of non-compliance, the CIPC is entitled to issue compliance notices and, if these are not complied with, pursue administrative or criminal penalties.
Some filings with the CIPC, like director changes, can involve collating a significant number of recent certified copies for example, certified copies of directors’ identity documents and/or passports. Directors, prescribed officers and company secretaries should be aware of the new timing requirements, and ensure that changes to the company’s governing documents, status, registered office and directors are submitted within the 10 business day period.