Beneficial Ownership Register Explained

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Here’s a date for your diary - 24th of May, 2024

Now, that’s a rather important date if you hold a 5% or greater stake in a company in South Africa as it’s the last date to register under the newly introduced Beneficial Ownership Register.

Failure to register if you should will be seen as a breach of the Companies Act and could result in fines being levied.

So what’s this all about, and what is Beneficial Ownership?

Beneficial Ownership Transparency (BOT)

BOT is all about making it clear who actually owns, controls and benefits from a company’s (or legal entity’s) activities. This is a continent-wide strategy to ensure that those who benefit from owning or controlling a company are not doing so to further activities such as money laundering or terrorism.

If you fancy a longer read on this subject, you can see what TaxJustice.net have written on the subject here.

The functionality provides for corporate vehicles (companies and close corporations) to submit with the Companies and Intellectual Property Commission (CIPC) details regarding its beneficial ownership status (5% and above) in terms of mentioned corporate vehicles.

CIPC has an explanation on their website to help you better understand what is required and legal basis for doing so.

Some terms explained

We’ll try and clarify exactly what is needed and what is meant by some of the terms used and answer some basic questions.

What is Beneficial Ownership?

In respect of a company, means an individual who, directly or indirectly, ultimately owns that company or exercises effective control of that company.

Who is a Beneficial Owner?

An individual/ natural person who, directly or indirectly, ultimately owns 5% and more of a company or exercises effective control of a company.

Can a company/Trust be a Beneficial Owner?

No, only a natural person can be considered a beneficial owner.

What is the minimum Threshold before a person can be considered a Beneficial Owner?

5% (five percent)

Which entities are required to submit?

  • Incorporated –Inc. (21)

  • Proprietary Limited –(Pty) Ltd (07)

  • Limited –Ltd (06)

  • State owned company –SOC (30)

  • Non-Profit Company –NPC (08)

  • Close Corporation

Documentary requirements under BOTS

The following documents are now mandatory for the Beneficial Ownership submission:

Non-affected company with beneficial ownership to declare.

  • Mandate

  • Certified ID

  • Securities register / members register and the information of the natural persons that are considered beneficial owners of the entity.

Affected companies (with or without BO-information).

  • Mandate

  • Certified ID

  • Beneficial interest register (section 56 of the Companies Act).

Non-affected companies with no beneficial ownership to declare.

  • Mandate,

  • Certified ID

  • Securities register (section 50 of the Companies Act) – no BO information (natural person) will be provided, because there is none.

If this new requirement affects you, or if you’re unsure exactly how it affects you, please get in touch and we’ll do our best to explain what’s required and how Anlo can help you ensure your compliance with these new requirements.