CIPC news summary February 2024
Welcome to our February roundup of the latest updates from Companies Intellectual Property Commission (CIPC)! This article is packed with crucial information ranging from the final deregistration of entities to groundbreaking court rulings that emphasize corporate transparency. We're also spotlighting the innovative Foreigner Assurance service and inviting you to the WIPO Summer School for an in-depth look at intellectual property. Amidst these developments, we address a recent security compromise at CIPC and assure you of measures to safeguard personal information. Plus, note the CIPC's closure during the Easter weekend. Stay tuned for these updates to keep your business ahead of the curve.
1. De-registration of companies and close corporations
As CIPC continues with the systematic final deregistration of entities that are non-compliant on their annual returns. Companies and Close Corporations which have been finally deregistered may apply for reinstatement provided they meet the process and documentation requirements. Once the entity is re-instated all required returns and documents must be filed within 30 business days.
Find further important information and applicable links on CIPC Notice 3 of 2024.
2. Enforcement of beneficial ownership filings and securities registers
CIPC issued a follow-up notice for entities to file beneficial ownership information. Starting 1 April 2024, the Commission will implement a new feature that blocks entities from filing their annual returns if they haven't submitted their beneficial ownership details. Further enforcement actions will target non-compliant entities. All registered entities must submit their beneficial ownership information by 24 May 2024, marking the anniversary of the regulation requiring such filings.
Read CIPC Notice 5 of 2024 for more information.
3. High Court Ruling on disclosing directors remuneration
In a recent court decision, the Gauteng High Court supported the CIPC in a dispute with G.U.D Holdings. The court emphasized the need for companies to be transparent, especially regarding the disclosure of directors' salaries. The case highlighted the difference between personal privacy and the confidentiality of financial information, stressing the legal requirement for openness. This ruling is a reminder for companies to adhere to transparency standards, aligning with the CIPC's goal to maintain clear corporate governance practices.
Read the court judgement for more information.
Read our publication in Accounting Weekly relating to the court judgement and how accountants can assist clients ensuring compliance through proper record keeping.
4. Processing reinstatements of companies takes 10 working days
The CIPC has announced delays in processing due to a high volume of reinstatement applications and queries following the final deregistration of companies in January 2024 for failing to comply with Annual Returns. Originally set service standards cannot be met, leading to extended processing times of up to 10 working days for reinstatement applications, deregistration, and reinstatement enquiries. The CIPC apologises for any inconvenience and is working diligently to address these matters promptly.
Read Notice 9 of 2024 for more detail.
5. Acceptable proof of physical address
Consult table in Practice Note 10 to ensure that you provide an acceptable proof of physical address for applications. The Practice Note lists different services and related requirements. Practice Note 10 of 2024, effective from 1 March 2024, requires strict adherence. Applications not meeting these standards will be rejected. Upon rejection, it's necessary to address and correct the specified deficiencies before resubmitting the entire application.
6. Beneficial ownership register
In Notice 12 of 2024, CIPC reiterates that entities are responsible for ensuring their Beneficial Ownership (BO) information submitted is accurate, complete, and verified. This accountability is crucial as incorrect or incomplete BO information not only contravenes the Companies Act but also poses risks related to compliance with anti-money laundering and counter-terrorism financing regulations. The CIPC's review system aids entities by identifying inaccuracies, allowing them to refile corrected information. Failing to provide truthful and accurate BO data can lead to enforcement actions and sanctions, underscoring the importance of diligence in these filings.
7. Foreigner assurance process integration with beneficial ownership
The CIPC has introduced a new online Foreigner Assurance service as of 1 December 2023, enhancing the verification process for foreign nationals involved with South African corporate entities. This service, integrated with beneficial ownership filings and other transactions since February 2024, ensures the accurate submission of foreign nationals' information through the e-Services platform. This step is part of the CIPC's commitment to improving customer service and aiming for precise and current information on its registers. Refer to CIPC Notice 13 of 2024 for more information.
Read the Step by Step Guide on the Foreigner Assurance service on the CIPC website.
8. Invitation to the WIPO South Africa summer school on intellectual property and transfer of technology
The WIPO Summer School offers a chance to delve into intellectual property (IP) domains, understanding WIPO's role and functions through lectures, case studies, and discussions. It's designed for those familiar with IP and requires completion of the WIPO Distance Learning Course (DL 450). The program, free for this session, accepts applications until 31 May 2024, requiring a résumé, motivation letter, and ID for registration. Successful participants receive a certificate.
Interested in joining? Find the detailed requirements and registration link here.
9. Challenges with CO-OP registration and business rescue system
CIPC apologises for the unavailability of services on the co-operatives registration and business rescue systems due to system challenges. Read Notice 16 of 2024 for more.
10. Notification of security compromise
The CIPC recently addressed a security incident involving unauthorized access to client and employee personal information. Prompt action by ICT technicians, leveraging advanced firewall and data protection measures, mitigated potential damage by temporarily shutting down affected systems. The breach was contained, and systems are operational again. Clients are advised to monitor their credit transactions closely. The CIPC is investigating the breach's extent and emphasizes its commitment to system security and information confidentiality. They apologise for any inconvenience and assure continued efforts to protect their platforms against unauthorised access.
11. CIPC closure for the Easter weekend
CIPC will be closed to the public from 12h00 on Thursday 28 March 2024 for the Easter week-end. Offices will be open at 08h00 on Tuesday, 2 April 2024.
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