# summary - Link: https://dearsouthafrica.co.za/companies-amendment-bill/summary/ - Published: 2021-10-04T13:15:14+02:00 - Author: dearSA [ Have your say on the Draft Companies Amendment Bill](https://dearsouthafrica.co.za/companies-amendment-bill/) ### DOWNLOAD DOCUMENTS BACKGROUND AND RATIONALE ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190547/Background_and_Rationale.pdf) [Download [64.34 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190547/Background_and_Rationale.pdf) PHILOSPHICAL PILLARS ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190546/Philosphical-pillars.pdf) [Download [56.86 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190546/Philosphical-pillars.pdf) OVERVIEW OF PROVISIONS ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190546/Provisions.pdf) [Download [66.05 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190546/Provisions.pdf) EASE OF DOING BUSINESS ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190546/EASE-OF-DOING-BUSINESS.pdf) [Download [61.48 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190546/EASE-OF-DOING-BUSINESS.pdf) REMUNERATION REPORT ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190545/REMUNERATION-REPORT.pdf) [Download [72.62 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190545/REMUNERATION-REPORT.pdf) BENEFICIAL OWNERSHIP ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190545/BENEFICIAL-OWNERSHIP.pdf) [Download [73.11 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190545/BENEFICIAL-OWNERSHIP.pdf) CLAUSE BY CLAUSE DESCRIPTION OF THE BILL ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190544/CLAUSE-BY-CLAUSE-DESCRIPTION-OF-THE-BILL.pdf) [Download [69.48 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190544/CLAUSE-BY-CLAUSE-DESCRIPTION-OF-THE-BILL.pdf) OTHER DOCUMENTS * [The full draft Companies Amendment Bill](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190544/companies-amendment-bill-2018-invitation-for-the-public-commnt-on-the-draft-companies-amendment-bill_20180921-GGN-41913-00969.pdf) * [Companies Act](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190543/090408a71-08.pdf) * [Draft Companies Amendment Bill, 2018](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2021/10/20190543/companies-amendment-bill-2018-invitation-for-the-public-commnt-on-the-draft-companies-amendment-bill_20180921-GGN-41913-00969-1.pdf) The Department of Trade, Industry and Competition (**the dtic**), held a briefing today on the Draft Companies Amendment Bill, 2021, which will be published for [public comment on Friday 01 October, 2021](http://www.thedtic.gov.za/wp-content/uploads/Revised_Companies_Amendment_Bill-1_October2021.pdf). This follows publication on 21 September 2018, of an earlier version of the Bill, which dealt with administrative bottlenecks identified during the implementation of the Act since May 2011. The 2021 version is a redrafted bill with significant amendments. The series of amendments in the 2021 Bill are aimed at achieving **three policy objectives **– improving ease of doing business in respect of certain provisions of the Companies Act; providing for greater transparency on wage ratios at firm level and; addressing true or beneficial ownership of companies, to address money laundering challenges. 1. Improving ease of doing business Company law should, among other factors, be clear, user friendly, consistent with well-established principles and not be over burdensome on the conduct of business. This is important not only for the attraction of foreign investors but also for the efficient and effective conduct of the domestic economy and for the creation of jobs.  A number of changes are proposed to the Companies Act to align he legislation with this objective. These are based on submissions received during the extensive engagement with business associations, firms, lawyers and investor groups and are designed to ease the doing of business through providing legal certainty where these do not currently apply, providing greater flexibility to companies in certain circumstances, or removing unnecessary provisions in the Act. 1. Providing for greater transparency on wage ratios The Bill seeks to clarify responsibilities between directors and senior management on the one hand, and shareholders on the other hand as well as addressing public concerns regarding high levels of inequalities in society. Excessive remuneration particularly at the highest levels of a company is a matter of great concern internationally and in SA. The amendments respond to shareholder concerns regarding excessive executive pay through two principal mechanisms: first, greater disclosure requirements in annual reports of companies; and second, improved shareholder rights in respect of remuneration policies. Amendments in the Bill require that certain categories of firms disclose information on the remuneration of directors and prescribed officers. Furthermore, it requires that companies disclose the average remuneration of all employees, and the ratio between the total remuneration of the top 5% highest paid employees and the total remuneration of the bottom 5% of the lowest paid employees of the company. Shareholder approval is required for the company’s remuneration policy. * Addressing true or beneficial ownership of companies, to address money laundering challenges Uncovering true or beneficial ownership is a critical measure in global efforts to confront and address money laundering, corruption and the financing of terrorism. The Companies Amendment Bill proposes new provisions on beneficial ownership, placing an obligation on companies to know and disclose the identity of their true shareholders who hold a beneficial interest amounting to 5% or more of the total shares in a company. The changes respond to concerns raised by social partners and many interested parties following a series of extensive consultations with the public, interest groups and interested persons, as well as the National Economic Development and Labour Council( Nedlac), the Specialist Committee on Company Law (SCCL), the Johannesburg Stock Exhange, the SA Institute of Chartered Accountants, the Institute of Directors in Southern Africa, the Helen Suzman Foundation and Amabhungane _inter alia_. “We are releasing this Bill for public comment prior to Cabinet considering it for approval. The amendments seek to update the Companies Act in light of developments in the field, address public concerns and improve the ease of doing business. One area covered in the Bill relates to remuneration policies and we are not the only country grappling with the challenge of high levels of inequality. Shareholder disquiet with the remuneration policies of some listed firms has featured at recent AGMs. The Bill proposes a transparency-driven approach, with clearer shareholder powers than what is currently the case. Public comments would be appreciated on this and the other provisions of the Bill,” Ebrahim Patel, Minister of Trade, Industry and Competition said today at the public release of details of the Bill. “Since the implementation of the Companies Act a number of deficiencies have manifested which has caused unnecessary costs of compliance and retards the efficient and effective conduct of business.  The Bill aims to eliminate, as far as possible, these deficiencies. In addition, certain unintended consequences of the existing legislation have also adversely impacted on the conduct of business and, so again, the Bill aims to remedy these problems.  All of these remedial measures take into account best practice which has arisen during the intervening period since the drafting of the existing Act.” Professor Michael Katz, Chairman of the Specialist Committee on Company Law( SCCL). The amendments contained in the Bill set out to improve accountability and scrutiny on remuneration practices, promote shareholder activism and corporate governance. Furthermore, they also relieve companies of onerous, impractical and burdensome provisions in previous iterations of companies legislation. Lastly, they give South Africa instruments to undertake its role in the global offensive against illicit cross-border behaviour. Enquiries: Bongani Lukhele – Director: Media Relations Tel: (012) 394 1643 Mobile: 079 5083 457 WhatsApp: 074 299 8512 E-mail: [BLukhele@thedtic.gov.za](https://dearsouthafrica.co.za/companies-amendment-bill/summary/BLukhele@thedtic.gov.za) Follow us on Twitter: @the_dti ### STATEMENTS FROM OTHER ORGANISATIONS Click on a logo to view. Want to display your organisation’s statement? [Click here. ](https://dearsouthafrica.co.za/companies-amendment-bill/summary/ referendum@dearsouthafrica.co.za?subject=org info for referendum info page) Close ### Cape Independence Advocacy Group ### Dear Speaker, I am writing to you on behalf of the Cape Independence Advocacy Group (CIAG) and the seventy thousand South Africans who actively follow our work. We wish to comment on the ‘Electoral Commissions Amendment Act, 2021’, which is proposed by the Democratic Alliance (DA) and was published in the Government Gazette on 21 June 2021. Given our mandate, our comments are made in the context of the Western Cape, although we appreciate and respect that the constitutional rights enacted through this bill will rightfully apply to all provinces. This bill is essential to restoring some degree of functional democracy to the voters of the Western Cape and we therefore unreservedly and wholeheartedly endorse it. Through their voting behaviour, Western Cape voters have made it abundantly clear that they do not endorse many of the policy and ideological positions of the South African national government, but are left utterly powerless to resist them because the voters in other South African provinces, who greatly outnumber them, hold starkly different ideological and political opinions. In terms of seeing their democratic will enacted, for the majority of Western Cape voters, the democratic era has not offered much of an improvement over the apartheid era. It is a statistical fact that, since 1994, the majority of Western Cape voters have never been governed by the political party they voted for, and they have no foreseeable prospect of ever being governed by the party they vote for. As such, they cannot be said to have functional democracy. One of the few glimmers of democratic hope Western Cape voters do have, is the provision of Clause 127(2)(f) of the national constitution, and 37(2)(f) of the Western Cape constitution, which allows them, at the discretion of the premier who they elected, to have their voices heard on matters which are important to them, without being drowned out by a national majority who fundamentally hold different views. To deny Western Cape voters this constitutional right would be a very serious infringement of their political rights and freedoms, and would be a clear indication that parliament and the national government are not interested in the constitutional rights and democratic wishes of Western Cape voters. We therefore call upon parliament to pass this bill at the earliest opportunity, and without objection. Yours Faithfully **Phil Craig (On behalf of the Cape Independence Advocacy Group) ### IN THE MEDIA