Should shareholders be revealed?

Ingé Lamprecht

Proposed changes to the Companies Act could soon require companies to disclose the identities of their shareholders.

The Companies Amendment Bill, published for comment in September, contains a planned amendment that would require companies to file a copy of their securities register, which contains shareholder details, with the Companies and Intellectual Property Commission (CIPC).

Currently, the Companies Act only requires companies to provide the CIPC with limited information, including an annual return and directors’ information. Although companies must keep a securities register, they aren’t required to file it with the CIPC, Vivien Chaplin at Hogan Lovells, explains.

The proposed amendments will apply to all companies and, if implemented, may result in shareholder information of both private and public companies becoming readily available to the public.

Chaplin says although shareholders and third parties have always had the right to access a company’s securities register, they likely had to jump through several hoops.

Transparency versus privacy

“With international money laundering, with crime, with corruption, with international terrorism, I think the whole world has been having these debates about whether or not this kind of information should be disclosed,” she says.

Yet, it’s not entirely clear how public the information will be.

While anyone can easily gain access to the names of directors and addresses online, this isn’t the case with a deeper level of content such as a company’s memorandum of incorporation. Following a written request, it can take between six and eight weeks to obtain such a document from the CIPC, according to Chaplin.

Annual returns also don’t become publicly available knowledge, adds Darryl Jago of Hogan Lovells. “We’re also debating what the true intention is behind this.”

With widespread concerns about corruption in South Africa, it would be great to see exactly what public figures own, Chaplin adds.

The deadline for comments is November 20.

Moneyweb

Former Steinhoff chief executive Markus Jooste benefitted from undisclosed property and share deals with the company he headed for more than 20 years, according to two investigative journalists who published explosive claims last week.

The journalists further allege the Steinhoff family has similarly been benefiting through a trust set up by Bruno Steinhoff around 1997.

The report by Financial Mail journalist Warren Thompson and Craig McKune of amaBhungane, comes almost a year after Steinhoff’s share price collapsed spectacularly upon Jooste’s resignation on December 5. This followed the refusal of Steinhoff’s auditors