By Koketso Mamabolo & Jessie Taylor
South Africa’s greylisting by the Financial Action Task Force (FATF) in 2022 sparked a wave of ongoing reforms aimed at strengthening the country’s anti-money laundering and counter-terrorist financing policies and mechanisms. One of these is an amendment of the Companies Act 71 of 2008, which came into effect in April last year with far-reaching implications.
In effort to bring more transparency and accountability, organisations - whether they be profit-making, NPOs or even non-exempt SOEs - are now obliged to file beneficial ownership information with the Companies and Intellectual Property Commission (CIPC) as part of their annual returns to avoid de-registration.
“Companies and close corporations are required to file Beneficial Ownership Information within 10 business days of its registration, and thereafter as and when such changes occur, but at least once a year with its Annual Return filing,” reads the CIPC’s Notice 67 of 2023.
In an effort to reduce the likelihood of people holding hidden interests, and to assist law enforcement agencies in their investigations, the CIPC is keeping a record of all people with control over legal entities. “The new regulations empowers [sic] government bodies such as SARS to go through your ownership structures with a fine tooth comb and take you to task,” explains Company Partners, which offers organisations assistance with company registration.
“Before these new regulations, companies were not required to disclose their Beneficial Ownership or shareholding information to entities like the CIPC. These issues were treated as confidential matters and were managed internally by the company through its share register, shareholder agreements and the like.”