If you establish a South African subsidiary on your own, you must be prepared for some considerations that may impact your decision. The nationality of your headquarters, as well as any existing trade agreements you have, may have an influence on your firm. Some firms require particular approvals, licences, or other regulations, such as those exporting and importing food or employing heavy infrastructure in South Africa.
The country has 11 official languages, with English and Afrikaans being the most widely spoken. English is the official business language, and it is also used in commerce and in public. In a corporate setting, most employers use English, however multiple languages may be used in different places.
Foreign nationals wishing to establish a South African subsidiary must deposit 2.5 million ZAR in the firm. Those monies must first be moved to South Africa from your current foreign bank account. After six months to a year of operation, you must provide documentation that your company employs South African nationals.
Although there are many other types of subsidiaries, the most frequent is a private business. Its setup instructions are as follows:
To register the firm, file Articles of Incorporation.
Fill out a Memorandum of Incorporation
Fill out a Notice of Incorporation
Create a bank account
Sign up for VAT and other taxes.
Register with the Department of Labor for Unemployment Insurance and Occupational Injuries and Diseases Compensation.
Submit an application to the District Council.
Reserving your company name is an optional step. A business can register with or without a name under the Companies Act of 2008. If you register without a reserved name, your registration number becomes the name of your business. Although this method is speedier, it is still advised that you get a proposed name reviewed, authorised, and reserved.
In South Africa, may I operate many enterprises under a single company?
Yes, you can conduct two or more different enterprises through a single limited company. This entails using trading names to divide the main firm into several sections, each of which may be managed as an independent corporation.
Is it necessary to register a subsidiary company?
Every business you want to run as a Subsidiary Company to your Holding Company must be registered. Also, if your Holding Company’s Subsidiary Companies have different owners, it might be difficult to liquidate a Holding Company since there are several owners to discuss.
How many shares are required to become a subsidiary?
If the parent company owns 100% of the shares, the subsidiary is known as a ‘wholly-owned’ subsidiary. The firm is a subsidiary if the parent just has a controlling stake in it (50% or more).
