What will happen to your existing Close Corporation when the new Companies Act is signed by the State President during the course of 2010?

Close Corporations can be registered until the new Companies Bill is enacted. Thereafter no new Close Corporations will be able to be registered.

Current Close Corporations will continue to exist in their present format. Current Close Corporations can choose to either convert to a Company or continue to exist until deregistration or dissolution in terms of the Close Corporations Act.

There will be no automatic conversion or dissolution. Close Corporations that continue to exist will have to provide financial statements and be subject to an audit on the same terms and conditions as the Minister regulates in the case of companies from time to time.

This article should not be used or relied upon as professional advice and is for information and marketing purposes. Please consult with one of our attorneys should you need legal assistance relating to this area of law.