The Minister of Trade, Industry and Competition, Mr. Ebrahim Patel, published the Companies Amendment Bill, 2021 on 1 October 2021 for public comment.
The Bill, if passed, will give effect to the first substantial changes to the Companies Act, No. 71 of 2008 since it came into effect on 1 May 2011, including a requirement for certain companies to make further disclosures around the remuneration of its directors and prescribed officers, and the gap between its highest and lowest paid employees.
Among other things, Minister Patel stated that the amendments proposed under the Bill aim to i) make it easier to do business in South Africa, ii) promote transparency in relation to a company’s affairs, and ii) counter money laundering and terrorism by requiring disclosures around ultimate beneficial ownership of companies.
But what do the amendments proposed under the Bill really mean for South African companies and will the amendments address the perceived deficiencies that have manifested since the implementation of the Companies Act, such as unnecessary costs of compliance and curtailing the efficient and effective operation of companies by imposing a cumbersome regulatory framework within which to do business?
Vivien Chaplin and Darryl Jago in the Corporate & Commercial practice at Cliffe Dekker Hofmeyr, are available to speak further on this topic and can address the following, which was outlined in the amended bill:
The promise of major upheaval for business in South Africa and if this is a reality or not.
If the Bill will assist with making it easier to do business in South Africa.
What other issues of concern raised by the business community have been addressed by the Bill, and what has not been addressed (despite being raised by the industry)?
The Bill’s aim to address public concerns about the high levels of inequality in society by requiring additional disclosures in relation to director, prescribed officer and employee remuneration.