Davies reassures on CCs
Johannesburg - It is not necessary to rush to register close corporations before the new Companies Act comes into effect on May 1, Trade and Industry Minister Rob Davies said on Monday.
"I am told there are huge queues outside the Cipro office because people are concerned about registering close corporations... there is no need to do that," Davies said at the launch of the Companies and Intellectual Property Commission (CIPC) in Midrand.
The CIPC is a merger of the Companies and Intellectual Property Registration Office (Cipro) and the Office of the Company and Intellectual Property Enforcement, and would come into effect with the new act on May 1.
The new Companies Act provides for the indefinite continued existence of the Close Corporations Act, but the act will no longer be available to register new close corporations.
Davies reassured business owners that the new act's provisions would be better than that of close corporations.
"... the processes after 1 May will give them everything of a CC but it will be simplified... it should allow... them to be more competitive than they are now."
He later told media that "all the benefits will be there and more".
Opening a close corporation was "your right but it's not necessary".
Close corporations would not be forced to convert to companies.
Davies was expecting the new act to be implemented on May 1, after some delays. However, President Jacob Zuma still had to sign it and the final draft had to be published.
The minister said both of these processes were imminent.
"It's not a given, but there is no indication otherwise," he added.
The Companies Act 71 of 2008 replaces the 1973 act, and has been widely debated and criticised for inconsistencies, unintended consequences and drafting errors.
"I am told there are huge queues outside the Cipro office because people are concerned about registering close corporations... there is no need to do that," Davies said at the launch of the Companies and Intellectual Property Commission (CIPC) in Midrand.
The CIPC is a merger of the Companies and Intellectual Property Registration Office (Cipro) and the Office of the Company and Intellectual Property Enforcement, and would come into effect with the new act on May 1.
The new Companies Act provides for the indefinite continued existence of the Close Corporations Act, but the act will no longer be available to register new close corporations.
Davies reassured business owners that the new act's provisions would be better than that of close corporations.
"... the processes after 1 May will give them everything of a CC but it will be simplified... it should allow... them to be more competitive than they are now."
He later told media that "all the benefits will be there and more".
Opening a close corporation was "your right but it's not necessary".
Close corporations would not be forced to convert to companies.
Davies was expecting the new act to be implemented on May 1, after some delays. However, President Jacob Zuma still had to sign it and the final draft had to be published.
The minister said both of these processes were imminent.
"It's not a given, but there is no indication otherwise," he added.
The Companies Act 71 of 2008 replaces the 1973 act, and has been widely debated and criticised for inconsistencies, unintended consequences and drafting errors.
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