The formation of companies is one of the most powerful mechanisms that fuels South Africa’s economy. With each new company comes the chance of a successful business. The more successful a business is, the greater impact it will have on the economy of South Africa.
People start businesses for multiple reasons these days. Some people are in the quest to make more money and other people are forming a company because it has been their life long dream to own and run a successful business. Whatever your reason may be, you are making a vital contribution to the economy of South Africa.
When new companies are formed, it provides a platform for growth and development of the economy. The government has changed the way in which they view company formation. It is no longer seen as a privilege to form a company, it is seen as a right to be able to start a company. The new Companies Act of 2008 has made this possible. It has made the process of forming a company so much easier and simpler, by removing unnecessary legal formalities.
According to the new Companies Act, only the utmost important legal formalities need to be abided by in order to formulate a company. It is also no longer needed for a company to have more than one founding member. A company, private or public, can now be formed by only one person.
Under the new Act, companies are required to complete a Notice of Incorporation. This Notice of Incorporation is a document in which the founding member(s) of the company give notice to the Companies Commission that they would like to form and register a company. The Companies Commission reserves the right to reject a Notice of Incorporation. This can be on the grounds of incomplete documents or if the company being formed does not meet the minimum standards that are set by the Companies Act.
As soon as the Notice of Incorporation has been drawn up to meet the requirements of the Act, a Memorandum of Incorporation must be drawn up. This document will be the last document that you will need to complete in order to finalise your application. Once your Memorandum of Incorporation has been approved, you will be issued with a certificate as proof of your company being registered. This certificate is then conclusive proof that you have complied with the requirements to form a company.
Company formation has also been made easier and more accessible for people all around the country. You can complete the entire application for the registration of your company online. Once you have obtained your registration certificate you can already start doing business. There is no need for a certificate to commence business or a trading certificate in order to start doing business anymore. You also no longer need a minimum share capital to start doing your business.
These are just some of the ways in which the new Companies Act has simplified the entire process of forming a company. The government has really gone out of their way to make it easier and more accessible for people all over the country to form a company. They have realized the true value of new companies being formed.
So whatever you have been dreaming about, it is time to act on that calling. The time will never be just right to do something, so why not do it now? Start to compile a few business ideas and before you know it, you can be the proud owner of a newly formed company.