Chartered Accountants

The New Companies Bill

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The highly anticipated Companies Bill was tabled in the National Assembly on 30 June 2008 after Cabinet approved the Bill for introduction to Parliament only a month prior to that. Copies of the Bill have become available to the public as it differs substantially from all the previous drafts released to the public.

The new Companies Bill will make way for a completely different categorization of companies, namely profit companies or non-profit companies. Profit companies will be further categorized into the following classifications:

- State-owned companies

- Private Companies

- Public Companies

- Personal Liability Companies

The Companies Bill provides for new requirements in respect of financial standards, financial reporting and auditors. It further promotes the role of the Company Secretaries and Audit Committees. However, the above is only a requirement for State-owned and Public Companies but does give other companies the option to have company secretaries and audit committees. It will thus institute new provisions that promote transparency, high standards of corporate governance and accountability.

Sadly, when the new Companies Bill is enacted by Parliament it will replace the Companies Act, 1973, Corporate Laws Amendment Act, 2006 and Close Corporations Act, 1984 which will result in the final scrapping of the Close Corporations Act, 1984. This entails that one will no longer be able to register a Close Corporation.

 

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