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CIPC: Complaints re businesses operating at deregistration
- 01 September 2025
- CIPC
- South African Accounting Academy
Summary:
The Companies and Intellectual Property Commission (CIPC) has acknowledged that a number of complaints have been lodged against entities that have been placed under Deregistration or Final Annual Return (AR) deregistration for failing to file their annual returns as required by the Companies Act.
Article:
In terms of section 82(3) of the Companies Act, read together with regulation 40 of the Companies Regulation, the CIPC may de-register a company that failed to file its annual returns and remove such a company from the companies registers. A company may also be placed under Deregistration upon filing a voluntary deregistration application with the CIPC.
Once a company is placed under Deregistration or Final AR Deregistration, the legal consequences are that the company loses its juristic/legal personality, in that, it ceases to exist as a legal entity. The directors/shareholder of such a company may be held personally liable for any liabilities incurred during such a period.
It is important to point out that section 82(4) of the Act, read together with regulation 40(6) of the Companies Regulations does allow/permit for a company that has been deregistered for failure to file annual returns to be reinstated on condition that the company is able to provide sufficient information that at the time it was deregistered the company was in business or it has immovable property, and that all outstanding annual returns are filed. Furthermore, any affected party may apply to court for an order to reinstate a deregistered company in terms of section 83(4) of the Act and upon receipt of such an order, file same with the CIPC for implementation.
Unless a company has been reinstated, any person that enters into business with a company that has been deregistered may suffer financial losses in that such a company can no longer litigate or be litigated against. Customers are urged to check the status of the entity on the CIPC’s BizPortal system to verify if that company is still in business or not before entering into contracts/transactions with any company.
In addition to the above, the CIPC further urges all companies that are under deregistration to apply for reinstatement if they still wish to continue conducting business. Remember that the CIPC has now introduced the automation of the Application for Re-instatement of Deregistered Company (Form CoR40.5), on 11 August 2025. Therefore, applications to re-instate a company or close corporation must be submitted electronically via e-Services, BizPortal and/or Self-Service Terminal platforms. Kindly take note that the previously used dedicated email for re-instatement application is no longer operational. Reinstatement applications shall be processed through the automated system. Refer to our previous Alert dated 14 August 2025
Click here to download Notice 36 of 2025:
Relevance to Auditors, Independent Reviewers & Accountants:
- The Companies Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with. If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – As an auditor, independent reviewer and accountant, this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
- Especially where you perform these compliance tasks on behalf of your client, you need to ensure that you are aware of all relevant notices/enforcements/practice notes/customer letters issued by CIPC as the regulator.
- As an auditor, independent reviewer and accountant you need to consider the impact of the Companies Act Regulations on your service offerings, as well as on your client’s filing obligations and the resulting deregistration and re-instatement processes.
Relevance to Your clients:
- An entity (company or close corporation) has a duty to comply with the Companies Act, and all relevant notices/enforcements/practice notes/customer letters issued by CIPC as the regulator.