If you want to start your own company or register a new cc and are still unsure if you can still register a close corporation, the answer is unfortunately no. The New Companies Act that came into effect on the 1st May 2011 does not allow one to register a new close corporation or CC.
Close corporations that were registered before The New Companies Act will still be allowed to operate indefinitely and the Companies and Intellectual Property Commission (CIPC) will still allow existing close corporations to make necessary changes to their close corporations. Some of these changes include amendments to the CC’s founding statement, amendments and appointing of new accounting officers, deregistration or liquidation of CC’s as well as reinstatements of close corporations.
Existing close corporations will also still be allowed to change their names, therefore there are still some companies that may offer a shelf cc for sale. A shelf CC is a close corporation that was registered before The New Companies Act and one should truly think carefully before buying a Close Corporation off the “shelf” as it is.
There are numerous amendments that need to be made before one is able to operate your new shelf close corporation properly including changing the name of your CC, amending the founding statement, registering yourself and others as members of the CC and so forth. Only once these amendments have been made will you be able to open a bank account and begin trading with your close corporation. You will also have to amend your details with SARS and be certain that all the CC’s tax returns are up to date.
It is therefore advisable to rather investigate the process of registering a new company with CIPC than to purchase a shelf cc. CIPC also currently allows all closed corporations to convert to companies without having to pay the necessary fees.
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