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CIPC: General Beneficial Ownership Notice
- 03 March 2023
- Accounting
- South African Accounting Academy
CIPC has been participating in the mutual and evaluation process conducted by the Financial Action Task Force (FATF). The purpose of the evaluation was to assess the countries law’s and the putting in place measures to combat money-laundering and the financing of terrorism.
The country as a jurisdiction was expected to take certain measures to address the deficiencies which were highlighted in the Mutual Evaluation report.
In one of the recommended actions contained in the mutual evaluation report, the CIPC was required to have a law which permits it to collect beneficial ownership of legal persons within its register. It was for this purpose that the the General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act 22 of 2022 was passed. The Act amends the Companies Act and gives the mandate to the Commission to collect beneficial ownership information. The Commission has been working with the National Treasury and the Financial Intelligence Centre (FIC) and other competent authorities in ensuring that the above Act caters for Beneficial Ownership requirement in terms of the Companies Act amendment. The Commission has been putting measures in place in ensuring that it will have systems in place to enable it to collect such information and address the deficiencies that were highlighted in the FATF mutual evaluation report of South Africa.
The Commission will therefore be implementing the collection of Beneficial Ownership information upon promulgation of the Regulations. The purpose of such is to ensure that ultimate beneficial owners of entities on our register is known and that abuse of corporate vehicles as means to facilitate money-laundering and the financing of terrorism is reduced and mitigated.
More information on this will be further communicated as soon the process of amending the regulations in terms of the Companies Act to give effect to the General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act 22 of 2022 are passed.
Click here to download the Notice:
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) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
- As an auditor, independent reviewer and accountant, you also need to monitor your client’s compliance with the Companies Act and all relevant notices/enforcements/practice notes/customer letters issued by CIPC as the regulator.
- Where you perform these compliance tasks on behalf of your client, you need to ensure that you comply with all relevant notices/enforcements/practice notes/customer letters issued by CIPC as the regulator.
- Your clients will also have to comply with the resultant General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act regarding anti-money laundering measures to be taken.
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.
- Your clients will also have to comply with the resultant General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act regarding anti-money laundering measures to be taken.
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