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BY Doron Joffe AND Sanjay Kassen
South Africa proposes tougher beneficial ownership rules: what companies need to know
The new General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Bill, 2026 (the “Bill”), introduced in the National Assembly on 27 May 2026, proposes significant changes to beneficial ownership compliance under the Companies Act, 2008. This alert summarises some of the key changes and what they mean for your business.
- New definitions
The Bill introduces three new or amended definitions:
- Obliged entity: A category of persons prescribed by the Minister.
- Discrepancy report: A report submitted by an obliged entity to the CIPC identifying material differences between the information that it holds on beneficial owners and the beneficial information recorded on the CIPC’s register.
- Material: The existing definition of “material” is expanded to include a new limb for beneficial ownership. In the context of beneficial ownership discrepancies, a difference is “material” if it could lead to an obliged entity to conclude that it cannot establish and verify the identity of a beneficial owner of a company.
- Discrepancy reporting obligations
Obliged entities will be required to notify the CIPC of any material discrepancy between the beneficial ownership information they hold (whether obtained under the Financial Intelligence Centre Act, 2001 or in the course of their duties) and the information on the CIPC’s register.
- New ground for deregistration
The CIPC already has the power to remove a company from the register if it fails to file an annual return for two or more consecutive years. The Bill adds a new ground for deregistration: If a company fails to submit its securities register or beneficial interest register for two or more consecutive years, the CIPC will be able to deregister that company.
- Expanded enforcement powers
Currently, if a company ignores a compliance notice from the CIPC, the CIPC must either apply to court for an administrative fine or refer the matter to the National Prosecuting Authority – but not both. The Bill changes this framework:
- Three enforcement options
The CIPC will be able to:
- apply to court for an administrative fine;
- refer the matter to the National Prosecuting Authority for criminal prosecution; or
- in certain cases, impose an administrative fine directly,
in respect of the same compliance notice.
- Direct fines for register failures: Where a company fails to comply with a compliance notice specifically relating to the submission of securities registers or registers of beneficial interest, the CIPC can impose an administrative fine directly – without court approval.
- Higher fines
Under the current law, the maximum administrative fine is the greater of 10% of the company’s turnover during the period of non-compliance and the prescribed maximum (currently not less than ZAR1 million). The Bill increases the minimum prescribed maximum for administrative fines from ZAR1 million to ZAR10 million – a tenfold increase.
- Right to review
A company that receives a direct administrative fine under the new framework will be able to apply to the Companies Tribunal for a review within 15 business days (or longer, if the Tribunal allows). The Tribunal may confirm, modify, or set aside the fine. Any confirmed or modified fine must be paid within the specified period, although further review or appeal to a court remains available.
For further information, please contact ENS’ Corporate Commercial Department.
Doron Joffe
Executive | Joint Head of Department | Corporate Commercial
Sanjay Kassen
Executive | Joint Head of Department | Corporate Commercial
