Do you have a Company or Close Corporation? Is it still registered or has it been deregistered? Thousands of Companies and Close Corporations will be automatically deregistered at the end of March 2013.
If your company or close corporation has been deregistered this has fairly disastrous consequences for you if your home or the building from which you work is an asset in that legal entity. It now belongs to the State!
There is an obligation on Companies and Close Corporations to render annual returns to the Companies and Intellectual Property Commission (CIPC). Failure to do so may render that legal entity subject to deregistration with the consequences outlined above. It could mean that:
- You lose the property which you call your home
- You lose the property from which you conduct your business
- Contracts entered into by your company may be null and void. You would not be able to enforce contracts as the company would have no legal status.
If you want to check whether your company or close corporation is still "in business" then follow this link and enter the legal entities name in the block at the bottom of the left hand column of the page http://www.cipro.gov.za/2/home/
All is not lost as the new Companies Act (section 82(4) read with Schedule 3, Part 8) provides that application can be made to reinstate the registration of both a company and close corporation if it was deregistered as a result of non-filing of annual returns. Such a reinstatement will have the effect of reviving the company or close corporation's rights and obligations.
However, when such an entity is the owner of immovable property, additional requirements are laid down: the written consent of both the Departments of Treasury and Public Works are to be obtained prior to lodging the application.
Since the process of transfer of any property owned or purchased by such entities are effectively stayed until such entity is reregistered, significant delays are to be expected when a deregistered entity is involved.
You would therefore be well advised to verify the status of your Company or Close Corporation with CIPC, as well as that of any entity you intend to transact with prior to entering into a contract for the sale of immovable property.
Thank you Mike Forsyth of MGF Attorneys in Hilton for sharing this important alert.