The Companies and Intellectual Property Commission (“CIPC”) has introduced its new system with changes for the filing of annual returns as of 11 December 2023. These new changes will join the filing of the Beneficial Ownership Declaration on the CIPC’s portal and the validation of the turnover of a close corporation or company. It is important to note that you will not be able to file the annual returns for a company or close corporation without having filed the beneficial ownership information of the beneficial owners of that specific company or close corporation.
As of 1 April 2024, it will therefore be mandatory to file the beneficial ownership information before you will be able to submit the annual returns of a company or close corporation. Although the process of beneficial ownership information and annual return submissions are two separate processes, both of these submissions have to be done on the CIPC’s portal to avoid the possible deregistration of a company or close corporation. These new changes to the system are mandatory and each filer will have to comply with these changes to avoid possible consequences.
To understand what the new system entails you must first consider and understand the difference between the beneficial ownership of a company or close corporation and the annual returns entail. In order to submit the beneficial ownership information of a company or close corporation you need to identify who the beneficial owners are of this company or close corporation. The beneficial owners refer to the natural person, in other words, the warm body, who indirectly or directly influences, owns or directs the affairs of a specific company or close corporation.
The annual return filing process refers to the annual submission of the latest information of a company or close corporation to the CIPC. This information includes updated information about the current directors or auditors of a company or close corporation, the names and addresses of a company or close corporation, the financial year of a company or close corporation as well as the financial information and records of a company and close corporation.
It appears that this new system of the CIPC will be the new way forward for South Africa when filing annual returns to ensure that all entities adhere to the strict compliance requirements which came into effect on 1 April 2023 in terms of the General Laws Amendment Act 22 of 2022. Directors and shareholders should accordingly take note of these changes and align their CIPC reporting accordingly.
Our Trust Office at PH Attorneys assists our corporate clients with beneficial ownership and annual return submissions. Feel free to contact our Trust Office for more information and assistance.
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