What is Beneficial Ownership?
The CIPC defines beneficial owners as: “The individuals who ultimately own or control a company, either directly or indirectly, by holding a beneficial interest of 5% or more in the company or share class. Typically, these are the shareholders or members of a company.” The exact definition varies depending on the type of company in question:
- Private Company (Pty) or Personal Liability Company (PLC): Individuals holding 5% or more of the shares, or companies with beneficial owners holding a beneficial interest of 5% or more in a subsidiary company.
- Close Corporation (CC): Members holding an interest of 5% or more in the CC.
- Non-Profit Companies (“NPC”): If a NPC has members, those members are the beneficial owners. However, where a NPC does not have members, the directors are considered to the the beneficial owners.
- State-Owned Company (SOC): The responsible Minister is the beneficial owner.
What does this mean for your business?
Within South Africa, businesses are required to file their beneficial ownership information with the CIPC on a regular basis. The original deadline for filing to CIPC was 1 October 2023, but the new deadline is within 30 days of the company’s next anniversary date (similar to annual returns), or within 10 days of incorporation if they were registered after 24 May 2023.
How does submission work?
An authorised individual from each company needs to submit the required BO details, along with supplemental documentation. This is detailed in a guideline for users published by the CIPC. Once the beneficial ownership information for an entity has been successfully submitted, the filer as well as the members/directors are provided with a BO Confirmation Certificate.
What happens if you don’t submit this information?
Filing beneficial ownership information is now a legislative requirement in South Africa. If you fail to submit the required information to CIPC, this is considered to be non-compliance with the Companies Act, which could result in administrative fines. This can also lead to possible investigations and eventual disqualification of directors.
Why use Cornerstone Corporate Services?
Submitting Beneficial Ownership (BO) information . As your trusted partner, Cornerstone Corporate Services can help you with a seamless transition to comply with the new BO register. Our expert team is ready to guide you through the process, ensuring accurate and timely submissions to CIPC.
Need assistance submitting your BO information to CIPC? Speak to us today.
