As of 1 July 2024, the Companies and Intellectual Property Commission (CIPC) has strictly enforced the filing of Beneficial Ownership declarations with annual returns for all companies and close corporations. This requirement was imposed by the General Laws (Anti-Money Laundering and Combatting Terrorism Financing) Amendment Act, which modified the Companies Act 71 of 2008, on the 31 December 2022.
In accordance with the revised Act, companies and close corporations cannot file Annual Returns using CIPC electronic platforms without submitting or updating the Beneficial Ownership Declaration, along with their Annual Financial Statements and Financial Accountability Supplements.
The filing of Beneficial Ownership Declarations is critical as they provide a register of natural persons who own or have effective control over legal entities, provide law enforcement with relevant information to help them in investigations. Beneficial Ownership information is aimed at reducing the risks that were identified in the national risk assessment where legal persons were found to be vulnerable to abuse for the purposes of financing terrorism and money laundering.
It is mandatory for all companies and close corporations to submit their Annual Returns to the CIPC within 30 business days of their anniversary date each year along with the Beneficial Ownership Declaration and security or beneficial interest register (if applicable). Penalties, investigations and possible deregistration may follow non-compliance.
The CIPC advises its clients to view the requirement for Beneficial Ownership filing as a cooperative effort to increase openness and reduce the likelihood of financial crimes in South Africa, rather than as a punitive measure. Sound corporate governance and business continuity depends on all companies and close corporations, adhering to the Beneficial Ownership filing requirements.