SA Information

Wesgro Cape Town

Investors Handbook
Entry and residence of foreign investors and expatriate labour
Entry requirements

Visas

Permits

Guidelines to evaluate Business Plan

Foreign exchange control

Business entities and registration

Sources of finance for the foreign investor

Intellectual property and specialised licenses

Prospecting and Mining rights

Land - acquisition, rezoning, subdivision and transfer

Site development

Importing and exporting

Tax and reporting

Other relevant laws for business

Recommendation for investors

Investment promotion agencies

 


Entry and Residence of Foreign Investors and Expatriate Labour

The entry and sojourn of aliens (persons who are not South African citizens) are governed by the Aliens Control Act, (Act 96 of 1991). The Department of Home Affairs is the issuing authority for all visas and temporary residence permits.

1. Entry requirements:

  1. Passport requirements

    Any person who wishes to enter the Republic of South Africa must be in possession of a valid passport or emergency travel document. The passport/travel document must contain at least two blank pages and must be valid for a period sufficient to cover the holder's stay in the Republic of South Africa.

    Passports must be submitted with all applications, but it may not be retained by the Department of Home Affairs.

  2. Health requirements

    A person visibly suffering from or who admits to suffering from infectious, contagious or any other diseases may also be required to produce a medical certificate. Immunisation for yellow fever is a requirement if the journey starts or entails passing through the yellow fever belt of Africa or South America.

    Persons with HIV or Aids are not considered to be prohibited persons.

    Being severely ill, from whatever cause, is still a legal reason for prohibition.

  3. Top of Page

  4. Financial requirements

    Funds:

    The visitor must be able to prove that he/she has sufficient means to maintain himself/herself and his/her dependants for the duration of the intended visit. The amount of funds required depends on the duration and nature of the visit.

    Return or onward air ticket:

    Persons visiting or studying/working in the Republic of South Africa for periods shorter than 12 months should hold a valid non-refundable air ticket.

    Cash deposits/bank guarantees:

    A cash deposit/bank guarantee is requested in order to ensure that an applicant complies with the period of validity, purpose and conditions of his/her temporary residence permit. If a person violates any of these, the deposit/bank guarantee is forfeited to the Government to be used to cover deportation costs.

    In the following cases, deposits/bank guarantees need not be requested at all:

    • Foreign personnel employed by established companies/industries/conglomerates in the Republic;
    • Religious workers/students associated with religious institutions;
    • Scholars;
    • Students attending courses at tertiary educational institutions for periods not exceeding 12 months, (They must, however, hold a valid return/onward air ticket where applicable);
    • Foreigners employed by government departments/universities/technikons and technical colleges;
    • Foreigners employed by non-governmental organisations or government-funded organisations;
    • Foreign personnel recruited in terms of Government agreements.

    Refunding of the cash deposit/bank guarantee will only be considered:
    a) Once the applicant finally has left the Republic of South Africa.
    b) Acquired an immigration permit, provided the conditions of the temporary residence permit have not been contravened.

  5. Top of Page

    Visas:

    In terms of Section II of the Act, in order to gain admission to South Africa, any person (other than a South African citizen), must be in possession of a valid visa unless provisionally exempted from the visa requirement. All applications for visas must be submitted to the nearest/most convenient South African diplomatic or consular representative abroad along with visa fees. Visa applications and passports may be forwarded by courier services or mail. Please note that ten (10) days are required to process visas.

    Schedule

    This schedule is subject to change without notice

    SOUTH AFRICAN VISAS: NATIONALS OF COUNTRIES EXEMPT

    Visas are not required by citizens of the following countries for the periods and subject to the conditions indicated. The exemptions pertain to ordinary, diplomatic and official passport holders. Official visits (on invitation of the SA Government) and accreditation for holders of diplomatic and official passport holders are not dealt with in this schedule.

    • Holders of South African passports, travel documents and documents for travel purposes.
    • Holders of passports of:
      The United Kingdom of Great Britain and Northern Ireland, including the British Islands Ballwick of Guernsy, Isle of Mann and the Virgin Islands and The Republic of Ireland are totally exempt from SA visa control and thus do not require visas for any purposes regulated by visas.

      Please note: Nationals of the British Dependent Territories are subject to visa control. The Territories are Anguilla, Bermuda, British Antarctic Territory, British Indian Territory, Cayman Islands, Falkland Islands, Gibralter, Montserrat, Pitcairn, Henderson, Cucie and Oeno Islands, the Sovereign Base Area of Akrotiri and Dhekelia, Turks and Caisos Islands.

    1. Holders of passports of the following countries in respect of bona fide holiday and business visits only (period unspecified) and transits:

      Australia Japan
      Austria Liechenstein
      Belgium Luxembourg
      Canada Netherlands (Kingdom of the)
      Denmark New Zealand
      Finland Norway
      France Portugal
      Germany Spain
      Greece Sweden
      Iceland Switzerland
      Italy United States of America

      NOTE

      An unspecified exemption implies that in practice a temporary residence permit exceeding a period of 90 days may be issued on arrival as long as the visit is of a bona fide nature.

    2. Holders of passports of the following countries in respect of bona fide holiday and business visits not exceeding 90 days and transits:

      Argentina Malta
      Brazil Paraguay
      Chile San Marino
      Ecuador St Helena
      Israel St Vincent & the Grenadines
      Jamaica Swaziland
      Uruguay
      Venezuela
    3. Holders of passports of the following countries in respect of bona fide holiday and business visits not exceeding 30 days and transits:

      Antigua and Barbuda Malaysia
      Barbados Maldives
      Belize Mauritius
      Benin Mexico
      Bolivia Namibia
      Botswana Peru
      Cape Verde Seychelles
      Costa Rica Singapore
      Cyprus** Slovak Republic
      Gabon South Korea
      Guyana Thailand
      Hong Kong* Turkey
      Hungary*** Zambia
      Jordan Zimbabwe (Government Officials, including police
      Lesotho on cross border investigation)
      Macau****  
      Malawi  

      * This exemption is only with regard to holders of Hong Kong British National - Overseas (BNO) passports, Hong Kong Special Administrative Region (HKDSAR) passports and Hong Kong Certificates of Identity.

      ** Diplomatic and official passport holders visiting the RSA for holiday purposes are exempt for 90 days in terms of the visa agreement.

      *** Diplomatic and official passport holders visiting the RSA for holiday purposes are exempt for 120 days in terms of the visa agreement.

      **** This exemption is only with regard to holders of Macau Special Administrative Region passports (MSAR)

    4. Agreements have also been concluded with the following countries for holders of diplomatic and official passports and will enjoy visa exemption for holiday and transits only, for the period indicated below:

      Czech Republic : 90 days
      Egypt : 30 days
      Malta : 90 days
      Moroco : 30 days
      Poland : 90 days
      Romania : 90 days
      Slovenia : 120 days
      Tunis : 30 days
    5. These arrangements are not applicable to individuals whose visa exemptions have been withdrawn. In all cases the normal entry requirement still have to be complied with before admission is gained.

    6. Visas are not issued at South African ports of entry and airline officials are obliged to insist on visas, if required, before allowing passengers to board.

    Top of Page

    Visa applications:

    • The outcome of the applications should be awaited and no travel arrangements must be made prior to the approval of the application.
    • The processing period is a maximum of ten days.
    • A non-refundable processing fee of R425.00 will be charged.

    The application should be made for the appropriate period of time, for the duration of the visit, as extensions are only granted in exceptional well-motivated instances.

    Top of Page

    Types of visas:

    1. Visitors Visa
      This is a multiple purpose visa. The condition for which the visa is applied for prescribes the purpose. For example: A technician that will visit the Republic of South Africa for a limited period of time to install machinery would be able to apply for a visa for this specific purpose.

    2. Business Visa
      A business visa may be granted to any person who intends proceeding to the Republic for the following purposes (a few examples):

      • To promote commerce, trade or industry between South African institutions and institutions abroad;
      • To explore investment opportunities;
      • To hold business discussions or attend business meetings;
      • To visit a business enterprise as shareholder or director;
      • To conduct business studies for surveys with a view to promoting business or business interest in South Africa.

      The following documentation must be submitted:

      • Application form B1-84E;
      • Valid passport;
      • Proof of sufficient financial means to support the applicant for the duration of the visit;
      • A letter of invitation from the company;
      • A non-negotiable return ticket. A cash deposit or bank guarantee for repatriation purposes may be required (This requirement must only be met once the visa has been approved, but before the actual visa is issued.).
    3. Medical Visa
    4. Re-entry Visa:
      • Only asylum seekers require re-entry visas to enable them to return to the RSA.
    5. Diplomatic, official and courtesy Visas

    Top of Page

    PERMITS

    Study Permits:

    Tertiary students

    The procedure to be followed by a foreign student wishing to study in the Republic is to formally apply for a study permit at the mission in his/her country of residence/origin and await the outcome of the application there, before finalising travel arrangements to the Republic. The prescribed application form BI-159 [Section A (general) and Section F for study permits], duly completed, must be accompanied by the following:

    • An official letter of provisional admission from the educational institution concerned as well as details regarding arranged accommodation;
    • Proof that the applicant has sufficient funds to cover tuition fees, maintenance and/or incidental costs;
    • A cash deposit/bank guarantee in an amount equivalent to the cost of an air ticket to the applicant's country of origin/residence for repatriation purposes, should this become necessary or forfeiture to the State, if study permit conditions are not complied with. (Except in the case of students attending religious institutions or students attending courses for periods not exceeding 12 months whom must, however, be in possession of a valid return/onward ticket, if applicable.)
    • A written undertaking (as provided for on the application form) by the applicant that he/she will return to his/her country of residence/origin on completion of the specific course indicated;
    • A medical certificate and particulars of arrangements made regarding medical cover;
    • Non refundable processing fee of R1 520 or $132.

    For the extension of a study permit, the following documents must accompany the duly completed application form BI-159, Section G:

    • Proof of having paid a repatriation guarantee, in the form of a receipt covering the initial cash deposit or a non-negotiable bank guarantee lodged prior to admission to the Republic;
    • A letter of registration from the educational institution; and,
    • Non-refundable processing fee of R1 140 or $99.

    Scholars/pupils

    Application for a study permit BI-159: A (general) and Section F. The declaration should also contain the following information:

    • Confirmation that the candidate complies with the language requirements;
    • Confirmation that the governing body is satisfied that the candidate can pay the relevant fees (as set by the Department of Education in respect of Government, State-aided and private schools);
    • Proof that the candidate has provided a written undertaking to leave the country on completion of his/her studies;
    • The grade in which the scholar will be placed; and,
    • Non-refundable processing fee of R1 140 or $99.

    Additional documentation to be submitted:

    An own passport, as the study permit must be affixed in the applicant's (minor's) own passport. (Except where countries do not issue separate passports to children.)

    A medical certificate. This report may be submitted to the school or directly to the mission with the application for a study permit. Should it be submitted to the school, then the school shall confirm receipt thereof in its declaration referred to in the paragraph above. The Department of Home Affairs' medical certificate form BI-811 may be used or a certificate by a medical practitioner, as provided for in item 6 of the study permit application form, stating that the relevant scholar is not mentally disturbed or physically disabled, does not suffer from any contagious or infectious diseases and is generally in a good state of health.

    Written permission by both parents since only minors are considered for pre-tertiary study in the Republic. In the event of the parents being divorced, a copy of the court order must be submitted, accompanied by a suitable letter of consent.

    In respect of scholars not accompanying their parents and applying in their own right, confirmation that satisfactory accommodation arrangements for the scholars have been made. Such accommodation may only be an educational institution's boarding school/hostel or with a close relative of the applicant, e.g. grandparents, who are South African citizens/permanent residents. It is imperative that prospective foreign pupils and their parents be informed that they have no claim to medical or legal services in the Republic and that the parents should make the necessary provision for this.

    A repatriation guarantee in the form of a cash deposit/bank guarantee, equivalent to the cost of an air ticket to the country of origin or residence. Confirmation from the Department of Education that the exchange programme is recognised:

    • A letter of registration/acceptance from the relevant educational institution;
    • A letter of endorsement by the sponsor;
    • A letter of confirmation of the guardian in the Republic (where applicable); and,
    • A return/onward ticket.

    Study permits are issued for the period that the scholar is registered for study, but shall not exceed a year.

    Dependent children under the age of 21, who are admitted to the Republic with their parents as approved immigrants, do not require any permits to study in the Republic.
    (They will be in possession of immigration permits.)

    Foreign scholars do not qualify for any state subsidies (except those from SADC countries and children of accredited diplomatic personnel), with the result that these scholars are liable for the full study fees, as prescribed by the educational authority in consultation with the governing body of the school and in accordance with prevailing circumstances. In effect, they have to pay the prescribed school fees plus an amount equal to the Government subsidy paid for each South African child.

    Requirements for extension of study permits

    • Application Form BI-159: G;
    • Gr. 1 to 12: school to complete items 6 (if applicable, e.g. private schools) and 6.2 on the application form and affix the school stamp. If no stamp is available, a letter confirming attendance must be submitted on a letterhead of the school;
    • In the case of study at a university or technikon, proof of registration must be furnished; and,
    • Proof of financial means to cover both tuition and subsistence costs.

    Requirements for change of institution

    Where a student/scholar applies to change to another educational institution, e.g. from a secondary to a tertiary institution, the following must be submitted:

    • Application BI-159: H;
    • A letter from the previous institution, stating whether or not the course was completed;
    • A letter of registration from the new institution;
    • Motivation why the change is necessary;
    • An undertaking to leave the Republic on completion of studies;
    • Proof of financial means to cover both tuition and subsistence costs;
    • Proof of medical cover (not applicable to scholars);
    • Proof of cash deposit/bank guarantee previously submitted; and,
    • Non-refundable processing fee of R1140 or $99.

    Top of Page

    Work-Seeker's Permit

    The difference between a work permit and a work-seeker's application is that, in the former case, the applicant already has a firm job offer and employment contract, while in the latter case the applicant's appointment is still subject to negotiations and the signing of the relevant contract(s).

    The following documentation needs to be submitted:
    • Application form BI-159 A and BI-159 B;
    • A non-refundable processing fee of R750 or $65
    • Certified copies of the applicant's educational qualifications, testimonials, certificates of employment;
    • The region in which the applicant intends to take up employment must be indicated;
    • Information with regards to the prospective employer;
    • Offer of employment and/or invitation to an interview (the applicant must at least have one or more job offers); and,
    • Processing period six(6) to eight(8) weeks.

    NOTE: when approved, a work-seekers permit is only valid for three moths. Extensions will only be considered in exceptional cases. Should the employment offer be finalised, the applicant may apply for a work permit at the Department's Regional or District Office. The documentation as indicated under the heading work permit/worker category will have to be submitted.

    Work Permits

    In terms of Section 26(1)(b) of the Act, a work permit may be issued to an alien who applies for permission to be temporarily employed in the Republic, with or without reward or to temporarily manage or conduct a business (enterprise) in the Republic, whether for his/her own account or not. Section 26(3)(b) furthermore, stipulates that a work permit shall only be issued to an alien if he/she is:

    • Of good character; and,
    • Does not and is not likely to pursue an occupation in which a sufficient number of persons are available in the Republic to meet the requirements of the inhabitants of the Republic.

    NOTE: A work permit is considered if the applicant is absorbed on the employer's establishment in a vacant position.

    Requirements for the extension of work permits

    It is advisable that applications for the extension of work permits be submitted at least eight weeks prior to the expiry of the permit. Since an expired permit cannot be extended in the RSA, the applicant will have to leave the country and apply for a permit from his/her country of residence. The application will be considered as a first application.

    Applicants wishing to extend their work permits must submit the following documentation:

    • Application form B1-159G;
    • A non-refundable processing fee of R1 520 or $132.00;
    • Employers must complete items 6 and 6.1 of the application form, sign the declaration and affix the company stamp. In the absence of a stamp, the appointment must be confirmed in a separate letter on the company's letterhead;
    • A copy of the official employment contract;
    • If applicable, proof of registration with the appropriate professional body;
    • Advertisements of the post, if the period of the original employment contract is to be extended;
    • An indication of the applicant's future plans and/or status of his/her immigration application (if the employment offer is of a permanent nature);
    • A police clearance certificate (if this was not submitted when lodging the initial application); and
    • A progress report confirming whether South African citizens or Permanent Residents have been or are being trained to fill the post.

    Source: http://home-affairs.pwv.gov.za

  1. Main Considerations:

    • Worker category: a South African Citizen or Permanent Resident can not perform the employment or task.
    • Own Business category: Foreign investment/Job creation.

    Section 26(2)(a) of the Aliens Control Act, 1991 (Act 96 of 1991) provides that an application for a work permit, may only be made while the applicant is outside the Republic and such applicant shall not be allowed to enter the Republic until a valid permit has been issued to him or her. Applications must be submitted to the South African foreign office in or the nearest such office to the country of which the applicant is a valid passport holder or the country in which he or she normally resides and the outcome must be awaited prior to making arrangements for departure to South Africa. To be considered in this category, the applicant must be at least a 25% shareholder in the company.

    Documentation to be submitted:

    • Application form B1-159 A and D;
    • A non refundable processing fee of R1 520;
    • Applicable documentation as mentioned above;
    • Own business questionnaire;
    • Proof of availability of funds to be transferred from abroad (no set amount is determined, but the amount must be consistent with the type of business, as well as to meet daily running expenses and for own subsistence);
    • Proven track record and audit trail (the applicant must be able to demonstrate a successful entrepreneurial history);
    • Viability of the venture;
    • Job creation for South African citizens (immediate job creation for at least two South African citizens.);
    • Number of foreign employees to be employed, capacity, duration of employment and motivation;
    • A clear, detailed business plan; PLEASE NOTE this is a key document and should include the following:
      • Executive summary
      • Business description
      • Market analysis (market and competition)
      • Marketing and sales activities
      • Product research and development
      • Manufacturing/delivery operations
      • Management and ownership
      • Organisation and personnel
      • Funds required
      • Financial data
      • If the need to buy equipment or furniture exists, a detailed list of items needed, together with quotes or estimated costs, must be inserted,
      • If an existing business is purchased audited past performance figures are required.
    • Processing period is at least eight weeks.

    NOTE: should an applicant wish to change from a temporary work permit in the worker category to a temporary work permit in the own business category, such an application may be lodged in the RSA at the nearest domestic office of the Department of Home Affairs. The applicant must be in possession of a valid work permit when such an application is lodged.

  2. Documentation to be submitted:

    Worker category:

    • Application form B1-159A and C;
    • A non-refundable processing fee of R1 520,00;
    • Age group 18 to 51 (this requirement does not apply to senior employees in management positions, employed for a limited period of time.);
    • Decree of divorce / court order, where applicable, as well as proof of maintenance paid to family members (also in the case of separations);
    • Marriage certificate, where applicable;
    • Full birth certificate(s) of children, where applicable;
    • Date on which the position became vacant,
    • An employment contract specifying the occupation and capacity in which employed, maximum duration of employment and remuneration;
    • A firm offer of employment commensurate with the applicant's training, qualifications and experience;
    • Qualifications (evaluated by the South African Qualification Authorities);
    • Service certificates from previous employers;
    • Curriculum vitae;
    • Whether the vacancies were advertised and, if so, in which national papers (e.g. Sunday Times etc.) or other suitable media/professional gazettes (copies of advertisements must be provided and Internet is not acceptable, as all South African citizens do not have access to the Internet.);
    • The employer must indicate whether the Department of Labour, private employment agencies, etc., have been contacted with the view of filling the post with a local incumbent;
    • Details regarding a training programme in which the skills and knowledge of the foreign worker will be transferred to a South African citizen who will be able to fill the position in the long run;
    • Police clearance certificates;
    • Medical certificate and proof of medical cover;
    • English translation of all documents/certificates, if submitted in a foreign language;
    • Proof of registration with a professional body, if applicable;
    • Cash deposit/bank guarantee; and,
    • Processing period is at least eight weeks.

    Please note that work permits are issued for a period of twelve (12) months only. The permits are extendable, but not for an indefinite period of time. The company must train a local incumbent to take over the work/task as soon as possible. The Department will request details of this training programme and the progress made.

Key Personnel/Transfers

International concerns with branches in the Republic may, from time to time, apply to transfer or second key employees from the foreign branch to the Republic. Should they wish to transfer applicants to fill existing positions or positions created by the company and at the same time form part of the South African company, whether they will be remunerated or not, work permits for the key personnel such as the directors, or the technicians could be applied for.

Each application will nevertheless be considered on merit, depending on the conditions and circumstances that may be applicable at that point in time. In this category, the documentation as set out above would be required as well as a letter from the company abroad confirming that the applicant has been in their employ and will be transferred to the branch/affiliated company in South Africa. Proof of the position being advertised is, however, not required. The company must, however, indicate how many South African citizens/permanent residents and foreigners are employed.

Secondments

Seconded employees are considered to remain in the employ of the company abroad and will, therefore, be remunerated by the said company. The applicant will only enter South Africa for a specific period and purpose and will return to resume his/her duties abroad after completing the assignment.

These applicants, therefore, do not become employed by the South African company and do not qualify for/require work permits. Visitor's permits with the appropriate endorsement will be issued to them on arrival in South Africa, provided the applicant does not require authorisation (in the form of a Visitor's visa) prior to departing for the Republic. These applicants cannot change their initial purpose of entry or submit applications for permanent residence whilst in South Africa

Persons wishing to be employed in the arts and entertainment industry:

NOTE: The Consultative Committee re: The Arts and Entertainment Industry is no longer operational. Applications do not need to be referred to them any longer.

The requirement to hold a work permit is only applicable to persons wishing to establish an own business in the entertainment industry or if the foreign artists, models and entertainers have a fixed work offer to be employed in the vacant position on the establishment of a company. The same documentation will have to be provided as mentioned, with the exception that application form BI-159 E will also have to be submitted.

Own business category: Persons in this category will also need to submit the following documentation:

  • Audited financial statements so that the viability of the business can be assessed;
  • Documentary evidence that, since the establishment of the business, at least two South African citizens or permanent residents, excluding family members, have been appointed and are still in service (names, identity document numbers, tax numbers and positions held).

Source: http://home-affairs.pwv.gov.za

INVESTMENT SOUTH AFRICA GUIDELINE DOCUMENT TO EVALUATE AN OWN BUSINESS PLAN

1. Main Criteria

1.1 The main criteria applied when determining applications in this category are the following:

Proven track record audit trail

The applicant must be able to demonstrate a successful entrepreneurial history in the venture he/she wishes to manage or conduct. This track record must consist of an audit trial and the following documentation to this effect should be available on request:

  • Audited financial reports indicating cash flow statements, income and expenditure statements and balance sheets;
  • Tax assessments;
  • Bank statements; and,
  • Any other relevant accounting records to indicate that the enterprise is or was solvent, liquid and profitable, including proof of turnover, deeds, writings, registration certificates, etc.

If the enterprise no longer does business, the reasons for this must be furnished as well as the winding up orders if the business was wound-up by a court, or any other documentation showing how the business was disposed of.

1.1.2 Availability of funds for transfer from abroad

The applicant must demonstrate that he/she has sufficient foreign capital abroad to transfer to South Africa to finance the venture, especially during the start-up phase. In determining the amount required, it is important to also take into account the applicant's subsistence costs until such time as the venture generates an income. The applicant must submit proof of funds available in the form of bank statements and/or foreign exchange transactions. An indication of how the funds originated must also be given so as to prevent South Africa being used for money laundering purposes. The amount to be transferred will be determined by the Department of Home Affairs or the Immigration Selection Board.

1.1.3 Viability of the venture and creation of employment for South Africans

One of the main purposes of allowing a foreigner to startup a venture in South Africa in competition with South Africans is to attract foreign investment and create employment for South Africans. For this reason, the venture must be viable and create employment for at least two South Africans. To determine the viability of the venture, the following must be submitted.

  • A business plan (This should cover a number of topics in detail. The business plan should not only be a dream story but also should contain factual research and contain specific reference of previous experience and work contacts. A full CV should also be attached to the business plan.);
  • Relevant work history;
  • Relevant job experience (It is very unlikely that a person would be successful in a new venture in a new company, if he has no previous experience of the specific sector in his country of origin.);
  • A draft memorandum of association describing the purpose and nature of business if the applicant intends establishing a company in terms of the Companies Act, 1973 (Act No 61 of 1973);
  • A draft founding statement if the applicant intends establishing a close corporation in terms of the Close Corporations Act, 1984 (Act No 69 of 1984);
  • The minimum number of South Africa to be employed; and,
  • If relevant, the maximum number of foreigners to be employed.

Note: An applicant who intends to engage in the day-to-day running of business may not register a company or close corporation in the Republic, whether for his/her own account or not, unless he/she is in possession of the necessary work permit. In terms of section 32(7)(b) of the Act, any license or other authority to conduct a business or carry on a profession or occupation obtained without being in possession of a work permit shall be null and void.

2. The business plan

A business plan is a critical assessment of the interdependent factors that are critical to the success of a new business venture.

2.1 Why do we need a business plan?

There is an old saying: "If you don't know where you are going, any road will get you there." In crafting sensible entrepreneurial strategies you better know where you may end up and have a good map for getting there. A business plan is the place where such a map is drawn, for as every traveller knows, a journey is a lot less risky when you have direction.

2.2 When do we need a business plan?

We need a business plan to convince providers of capital to invest their money in our enterprise.

2.3 When do we compile a business plan?

Every time we consider investing in a new venture or project, expanding into a new market or product or wanting to approach an investor or institution for finance, we should compile a fresh business plan.

2.4 Who has to compile the business plan?

We should do it ourselves. For the financial part (balance sheet, income statement and cash flow forecasts) you could use the services of an accountant, but the entrepreneur should create the essence of the plan.

2.5 How do we compile a business plan?

A good business plan should cover four key areas:

The People

The men and women starting and running the venture as well as the outside parties providing key services or resources for it.

The Opportunity

A profile of the business itself - what it will sell and to whom, whether it can grow and how fast. What its economics are, who and what stands in the way of success. What is the market sector and conditions that will facilitate success of this business.

The Context

The big picture - the regulatory environment, interest rates, demographic trends, inflation and the like - basically factors that inevitably change but cannot be controlled by the entrepreneur.

Risk And Reward

An assessment of everything that can go wrong and right and a discussion of how the entrepreneur team can respond.

Questions that must be answered about the people:

  • Where are they from?
  • Where have they been educated?
  • Where have they worked and for whom?
  • What have they accomplished in the past - personally and professionally?
  • What is their reputation in the industry?
  • What experience do they have that is directly relevant to the opportunity?
  • What skills, knowledge and abilities do they have?
  • How realistic are they about the venture's chances of success and the tribulations they will face?
  • Who else needs to be on the team?
  • How will they respond to adversity?
  • Do they have the mettle to make the inevitable hard choices that have to be made?
  • How committed are they to this venture?
  • What are their motivations?

Questions that must be answered about the opportunity:

Describe the structure and attraction of the industry in which you want to participate.

  • Does the market actually allow you to make money?
  • What are the competitive factors?

Describe specifically how the business will make enough of a profit for the owners, investors, financiers, suppliers and employees to be willing to participate.

  • When does the business have to buy resources?
  • How does the business have to pay for them?
  • How long does it take to acquire a customer?
  • How long before the customer sends his cheque?
  • How much capital equipment is required to support R1,00 of sales?

Describe in detail how you will build or launch your product or service in the marketplace.

  • Who is the new venture's customer?
  • How does the customer make decisions about buying this product or service?
  • To what degree is the product or service a compelling purchase for the customer?
  • How will the product or service be priced?
  • How will the venture reach all the identified customer segments?
  • How much does it cost (in time and resources) to acquire a customer?
  • How much does it cost to produce and deliver the product or service?
  • How much does it cost to support a customer?
  • How easy is it to retain a customer?
  • Does the customer pay cash or credit?

Describe in detail the competition, your comprtitors.

  • Who are the current competitors?
  • What resources do they control?
  • How will they respond to the new venture's decision to enter the market?
  • How can the new venture respond to the competitor's response?
  • Who else might be able to observe and exploit the same opportunity?
  • Are there ways to co-opt potential or actual competitors by forming alliances?

Questions that must be answered about the context:

Describe the macroeconomic scene and the legal and regulatory environment

  • How does it hinder or promote the venture?
  • Describe how changes in the context could impact on the venture.
  • What can (and cannot) the entrepreneurs do if the context turns unfavourable?
  • Explain the ways (if any) in which the entrepreneurs can affect the context in a positive way.

Questions that must be answered about the risk and reward:

  • Discuss the risk and how it will be managed.
  • What are the risks of the people, the opportunity and the context?
  • What rewards will the business deliver and to whom, when and how much?

Financial forecasts

Convert your operational activities into money and compile an estimated balance sheet, income statement and cash flow statement. These figures should reflect the key drivers of the venture's success or failure. It should also reflect the break-even issue and the point at which cash flow turns positive.

Funds required

The applicant must show the immediate and future funding that is required; how those funds will be used; and how and from where the funds will be acquired. This section complements the next one on financial data, and should summarise the amount of money needed to finance the operation. The applicant must demonstrate that he/she has enough working capital to sustain him/her and his/her dependents during the start-up period.

What should be kept in mind is that a person should have sufficient start-up capital to sustain a manufacturing company for twelve (12) to eighteen (18) months (R1 million) and a franchise for at least six (6) months (R400 000). This excludes funds to sustain the individual and his family.

The capital invested in the venture should be 50/50, meaning that for every R1 he/she borrows, he/she should invest R1.

Financial data

This should contain the financial representations of all the information presented in the other sections of the business plan. For instance, if under the Marketing and Sales Activities section the applicant referred to the need for pamphlets to be printed, the applicant must have included an estimate of the cost thereof. The financial forecast should include a month-by-month forecast of what the applicant expects his/her income to be, and related expenses. If possible, three different scenarios should be submitted - best case, worst case and likely scenario. Items such as repayment of loans, rent, electricity and telephone deposits should be included. Provision for unexpected expenses should also be made.

If the need to buy equipment or furniture exists, a detailed list of items needed, together with quotes or estimates of costs, must be inserted.

If the applicant is purchasing an existing business, he/she must show audited past performance figures.

3. Evaluation of the business plan

In the evaluation of the business plan, officials must inter alia determine the following:

3.1 Is there a need for the product or service in South Africa, i.e. will the business be in the best interest of South Africa and its citizens? E.g. will the setting up of a bottlestore be in the interest of South Africans in the light of the many South Africans willing and able to open one, if the necessary liquor licenses were not limited? Determine whether the venture will:

  • Introduce new or improved technology;
  • Export South African goods or services;
  • Produce goods or provide services that would otherwise be imported into South Africa;
  • Develop business links with international markets;
  • Increase market competitiveness; and,
  • Increase employment.

3.2 What is the entrepreneurial ability of the applicant, considering the applicant's qualifications, training and experience? Of particular importance is the success rate of the applicant's previous venture(s).

3.3 What is the likelihood that the business will succeed, considering the nature of the venture, the market research done by the applicant and the proposed location of the business?

3.4 What is the long-term nature of the venture? It is preferable that the venture should be of a permanent nature so as to prevent short-term profit taking and leaving the country with unpaid debts and destitute employees.

3.5 What is the number of jobs that will be created for South Africans? At least two South Africans must be employed immediately once the venture starts up. If more foreigners than South Africans will be employed, the application does not stand a fair chance of being approved. Check that reasonable salaries will be paid and whether exploitation of workers may take place.

3.6 Does the applicant have the necessary management skills? He/she may previously have had a one-man business and now wishes to employ 20 persons or he/she may never have been in a management position.

3.7 Are the funds to be transferred sufficient to start-up the venture, to cover the living costs of the applicant and his/her family, and to remunerate at least two South African employees? The applicant should not be likely to have to obtain a loan to float the venture. The applicant should be able to demonstrate that the funds to be transferred have been accumulated legally in his/her own account over a convincing period of time. Sudden large amounts deposited should be questioned and the origin investigated. An audit trail should exist. This is important as many applicants borrow the money or use rollover funds that leave the Republic once a work/immigration permit has been obtained. Care must be taken to ensure that the venture is not used to launder money obtained by illegal means.

3.8 Audited statements must be cross-checked and compared with tax returns, VAT payments and other substantiating documents. The profitability, solvency and liquidity of the venture must be determined.

To determine the solvency of a venture and total assets: total liabilities should not exceed a ration of 2:1.

To determine liquidity and current assets: current liabilities should not exceed a ratio of 2:1.

An acid test or quick ratio may be determined by current assets - stock: current liabilities, in which case the ratio should be 1:1.

FOREIGN EXCHANGE CONTROL

Exchange control in South Africa is administered by the South African Reserve Bank's (SARB) Exchange Control Department and through commercial banks that have been designated as "authorised dealers" in foreign exchange. Significant progress has been made in the liberalisation of exchange controls since 1994. The financial rand mechanism was abolished in 1995, removing most controls on non-residents. In June 1997, controls on South African residents were considerably relaxed, and virtually all controls on current account transactions were removed. There are no restrictions on foreign firms wishing to invest in share capital. Investors are advised to ensure that the share certificates are endorsed "non-resident" by an authorised dealer in order to return disposal proceeds and dividends to their country of origin. A record of funds introduced into South Africa should be kept. For every purchase of exchange, irrespective of the amount involved, authorised dealers are required to report to the South African Reserve Bank details of payments received from foreign partners by South African residence.

Generally speaking, there are no controls over the removal by non-residents of investment income or capital gains. However, repayment of foreign loans by South African residents requires prior approval. Dividends may be paid to a non-residents without the approval of the South African Reserve Bank. Dividends paid pursuant to a deregistration or liquidation due to non-resident are transferable against documentation confirming this fact. All loans from outside the Common Monetary Area to South African residents require prior Exchange Control approval. Approval is normally granted provided the minimum tenor of the loan is for a period of at least one month and a market - related interest rate is charged, i.e. up to prime plus 3% for South African denominated loans and up to prime plus 2% for foreign denominated loans which are not shareholder-related funds, with shareholder's funds restricted to prime.

A South African company that is 75% or more foreign owned is restricted in the amount that it may borrow or access from South African lenders, and is known as an "affected company". The borrowing or facility limit, known as local financial assistance, is based on a pre-set formula. For companies that are 100% foreign owned, the local financial assistance limit is 100% of the effective capital of the South African company. Effective capital includes paid-up equity capital, preferences shares, undistributed earned profits, shareholders' loans from abroad and, in certain instances, the hard core shareholders' trade credit.

The percentage of effective capital that may be borrowed is:

100% + (% South African interest)   100%
------------------------------- X -------
(% Non-resident interest)   1

The Reserve Bank will not permit the remittance of profits or repayment of loans where, as a result of the remittance, the local financial assistance limit will be exceeded, and will require local financial assistance to be reduced before remittance.

For every sale of exchange, irrespective of the amount involved, authorised dealers are required to report to the South African Reserve Bank details of payments made to foreign parties by South African residents.

Royalties, license and patent fees to non-residents, where no local manufacturing is involved, require the approval of the SARB. Manufacturing royalties (as opposed to sales/marketing royalties) are subject to approval by the Department of Trade and Industry, which will communicate its decision to the licensee or the Exchange Control Department where applicable, which will enable an approach to a bank directly to transfer the royalty payments. Current account payments, e.g. management fees and other fees for services provided, may be paid by authorised dealers on production of an invoice, provided that such payments are not calculated as a percentage of sales, profits, purchases or income.

Top of Page

BUSINESS ENTITIES AND REGISTRATION

The most common business entities in South Africa follow:

  • Companies;
  • Close corporations;
  • Partnerships and sole traders;
  • Joint ventures; and,
  • Local branch of a foreign company.

Companies (private and public)

These may be public (Limited) or private ((Proprietary) Limited) and are the most common investment vehicles for foreign investors operating in South Africa. They exist as separate legal entities from their shareholders and/or members. No distinction is made in the Companies Act between companies that are locally owned and those that are foreign owned and, once formed, a company has an unlimited lifespan. Both public and private companies must be incorporated and registered with the Registrar of Companies. Companies incorporated in South Africa must have a registered office and maintain certain statutory and accounting records in South Africa. If the accounting records are maintained outside of the Republic, the company must receive such financial information and returns as will enable the statutory financial statements to be prepared. Approval of the name of the company must be obtained from the Registrar of Companies before incorporation. (The choice of name is restricted by certain criteria, such as it cannot already exist as a company name.)

Public companies may offer their shares for sale to the public, although they need not be listed on the stock exchange or the public to hold an interest in their shares. Their characteristics are that the number of shareholders is unlimited, there are no restrictions on the transfer of their shares and they must file a copy of their annual financial statements with the Registrar of Companies, which are available for public inspection. Private companies, on the other hand, may not offer their shares for sale to the public. The right of transfer of their shares is restricted and the number of members is limited to 50. Private companies are not required to file their annual financial statements with the Registrar of Companies; thus, they are not available to the general public. They must include the word "Proprietary" or (Pty) at the end of the registered name immediately before the word "Limited" or "Ltd".

For both types of companies, an audit by a registered accountant and auditor is obligatory.

The Companies Amendment Act, 1999 (Act 37 of 1999) was published on 30 April 1999 and made provision for:

  • A company to acquire its own shares under certain circumstances, thereby providing a mechanism to restructure the company's capital and unlock shareholder value;
  • Disclosure of beneficial interest in securities to enable companies to ascertain who its shareholders are; and
  • The mandatory appointment of a company secretary for all public companies, excluding a share block company.

In order for the company to buy back its own shares, the following conditions must be met:

  • The company's articles of association must permit share buy-backs;
  • Shareholders must be circularised regarding the proposed buy-back and a special resolution must be passed by the shareholders authorising the buy-back;
  • The company should be solvent and liquid (otherwise the directors will be jointly and severally responsible); and,
  • Following the buyback, the company's share capital should not consist wholly of redeemable shares.

The amendments came into effect on 30 June 1999.

Registration requirements
All required registration forms may be purchased from a stationer dealing in statutory forms for approximately R100.

To reserve a name, a CM5 application form (duplicate copy no longer required), stamped with R50 in revenue stamps, must be submitted to the Registrar's office. In order to save time and costs, it is recommended that three to four alternative names be furnished in order of preference. A preliminary search can be done on the website. Following approval, the name will be reserved for a period of two months. Within this period, the documents for incorporation should be submitted. An extension of one month may be granted with the submission of the CM6 form, stamped R20 in revenue stamps. The application for extension must be received by the Registrar before the end of the first two-month period.

Legal and other professional fees relating to the registration of a company depend on the complexity of the individual application. For ordinary applications, without complications, legal costs start at about R4 500.

Standard versions of a memorandum and articles of association are included in the Companies Act. A company may choose to submit its own version. However, this may slow down the approval process, as they would require close examination by the Registrar's office.

All companies must have an independent auditor to produce annual financial statements. At the time of incorporation, the auditor is required to sign an acceptance of the office.

Registration applications must be submitted by hand to the Office of the Registrar in Pretoria. If no errors or omissions are made, the application will be processed in three (3) to five (5) business days. A complete application includes:

  • Copy of approved CM5;
  • Power of attorney (if attorney is used or if more than one subscriber exists);
  • CM22 (notice of postal address and registered office address), in duplicate;
  • Memorandum and articles of association, in duplicate (one copy bound in book form and certified by a notary public);
  • CM1 certificate of incorporation;
  • CM2 (first page of memorandum of association), stamped with a minimum registration fee of R350, plus R5 per R1 000 of share capital or part thereof and/or R5 per 1 000 shares if no-par-value shares;
  • CM44c (signature page for subscribers);
  • CM46 (certificate to commence business), stamped R60;
  • CM47 for each director;
  • CM29 (return of Register of Directors);
  • CM27 (notice of Company Secretary), if a public company; and,
  • CM31 (notice of Appointment of Auditor) in duplicate.

Top of Page

Close corporations

A close corporation is a common form of business entity for smaller businesses and is created under the Close Corporations Act, 1984. A close corporation does not have directors, its business being conducted by the members, who must be natural persons (i.e. individuals). A close corporation cannot, therefore, be owned by a company, another close corporation or a trust. In a close corporation, the members have the rights and obligations of both shareholders and directors, and consequently, ownership and management of the corporation are not separated. Close corporations may have up to 10 members. In general, few formal requirements are imposed on close corporations.

The capital of close corporations is called a "contribution". A close corporation is not subject to the stringent capital maintenance rules applicable to share capital in companies. The interest of a member of a close corporation is represented by a percentage, which is established on registration of the founding statement, and which may be changed by the registration of an amended founding statement.

Members of a close corporation enjoy limited liability, which may be lost if they violate certain provisions of the Close Corporations Act.

The Companies Act and the Close Corporations Act both allow the conversion of a company to a close corporation and the reverse. They also provide that the legal entity continues after the conversion.

Reporting requirements for close corporations are not as onerous as those for companies. A statutory audit is not required; however, the close corporation must have an accounting officer who must report that the annual financial statements are in agreement with the accounting records.

Registration requirements
Close corporations are required to register with the Registrar of Close Corporations. The reservation of a name is similar to that of a company. No auditors are required for the registration of Close Corporations and lawyers are not necessary. The corporation will need to appoint an accounting officer.

Due to the great number of applications received by the Registrar's office - up to 650 daily - approval takes five (5) business days. Applications may be submitted either by mail or by hand and should include the founding statement application, the CK1 form in duplicate and an approved CK7 form, and an original letter of consent from the accounting officer.

Top of Page

Partnerships and sole traders

Partnerships and sole traders are subject to few statutory requirements, but the partners and the traders generally do not have the protection of limited liability. However, in an en commandite partnership (in which not all the names of the partners are disclosed), the undisclosed partners may limit their liability to third parties to the amount of their contribution to the partnership.

Under the Companies Act, any unincorporated company, association or partnership may not consist of more than 20 persons, except in the case of certain professional partnerships, where there is no limitation on the number of partners. Registration is not required and there are no statutory reporting requirements, except that for tax purposes financial statements must be produced in sufficient detail to enable tax assessments to be made by the Receiver of Revenue.

Joint ventures

A joint venture is a contractual relationship between two or more enterprises engaged in a trade or business that does not qualify as a partnership.

Top of Page

Local branch of a foreign company

With the exception of banking and insurance companies, any foreign company may establish a place of business and carry on its activities in South Africa without forming a separate locally incorporated company. The establishment of a branch requires registration with the Registrar as an "external company" under Section 32 of the Companies Act within twenty-one (21) days after the establishment of a place of business in the Republic.

Registration requirements
The application requirements to establish a branch include:

  • A completed application form;
  • A certified copy of the memorandum and articles of association of the company and a certified translation in one of the official languages of the Republic;
  • A notice specifying the registered office and postal address of the company;
  • The consent and name and address of the auditor in South Africa;
  • A notice of the financial year-end of the company;
  • Details of the local manager and secretary of the company as well as details of the directors and their consent to act in that capacity; and,
  • A notice of the name and address of the person authorised to accept service on behalf of the company.

The legal costs should be less expensive than for incorporating a South African company.

A registered office must be established in South Africa and the company must appoint a South African resident to act as its legal representative. A local auditor must be appointed and audited financial statements in respect of the South African branch, together with a certified copy of the most recent financial statements prepared under the requirements of its country of incorporation, must be filed with the Registrar of Companies. In certain circumstances, an exemption may be granted in respect of these filing requirements.

Local equity participation
There are no local equity requirements, except for major banking institutions where local control is required by government policy. However, in the case of business entities with non-resident ownership equal to or greater than 75%, restrictions exist in relation to local borrowings and debt: equity ratios.

Contact information:
Office of the Registrar of Companies and Close Corporations
Department of Trade and Industry
PO Box 429
Pretoria 0001
Telephone: 0861 843 384
Website: http://www.cipro.gov.za/

Top of Page

SOURCES OF FINANCE FOR THE FOREIGN INVESTOR

The main sources of short-, medium- and long-term financing for companies are the commercial banks. Funding an investment by way of a loan is tax efficient, because if the funds are used for the purposes of a trade and in the production of income, the interest paid on the loan should be tax deductible subject to the transfer pricing and thin capitalisation provisions.

A South African company in respect of which 75% or more of its capital, assets or earnings may be paid to the benefit of a non-resident of South Africa, or of which 75% or more of its voting power, power of control, capital assets or earnings are vested in or controlled by or on behalf of a non-resident of South Africa, is restricted in the amount that it may borrow from South African lenders, and is known as an "affected company". Local borrowing for these purposes is widely defined and includes virtually all forms of borrowing and financing facilities, e.g. bank loans, overdrafts, facilities and finance leases, but does not include normal trade credit extended by suppliers of goods or services. The borrowing limit is based on a pre-set formula. For companies 100% foreign owned, the local borrowing limit is 100% of the effective capital of the South African company. Effective capital includes share capital, share premium, retained earnings, shareholders' loans to the extent that these are in proportion to shareholding, deferred tax and the minimum trade credit granted to the local company by its overseas affiliates, to the extent it can be viewed as a permanent intra-group facility.

The percentage of effective capital that may be borrowed is (100% + (% local participation divided by % foreign participation x 100)). Affected companies applying for local finance must complete the MP79(a) form, which discloses the assets and liabilities of the applicant company prior to the granting of the financial assistance. On application, the assets and liabilities of a number of South African companies under common control can be aggregated for the purposes of establishing the maximum level of local borrowings that may be granted to the group, such that an individual company may be "over borrowed", provided that the group as a whole is in aggregate within the borrowing limit for the group.

The Reserve Bank will not permit the remittance of profits or repayment of loans where, as a result of the remittance, the local borrowing limit will be exceeded and will require local borrowings to be reduced before remittance.

Mortgage loans
Each commercial bank applies its own policy in the granting of a mortgage over a commercial property. The factors that it takes into account include the value of the buildings, based on a professional valuation undertaken by the bank, and where they are situated. Normally, South African banks lend about 70 per cent of the value of a commercial property, but this can vary from one bank to another.

Unsecured loans
The most common way for a business to finance its working capital is through an overdraft facility. A commercial bank might be prepared to grant this on an unsecured basis depending on the financial standing of the company, taking into account, for example, whether the business has sufficient assets and cash generation ability to service the overdraft. Alternatively, the bank might require security for the loan in the form of, for example, personal guarantees by the directors, physical security such as a bond over an unbonded property, or a cession of the book debts of the company.

Discounting and factoring
South African banks will also, in some cases, be prepared to discount, for example, foreign bills, trade bills, bankers' acceptances or promissory notes. There are also a number of institutions, many associated with the banks, that undertake factoring, where the institution will advance money against the client's debtors' book. Normally, factoring gives a better rate than a normal bank cession over a debtors' book, but that also depends on the quality of the book.

Corporate finance
The commercial divisions of the major banks offer standard lending products to medium-sized companies. There are also corporate finance divisions in the major banks, or specialised corporate finance institutions, which offer tailor-made solutions for larger or more complex needs, such as the financing requirements of multinationals or listed companies.

Export finance and guarantees
Commercial banks will assist with export credits, guarantees and letters of credit. The Credit Guarantee Insurance Corporation of South Africa administers an export credit insurance scheme on behalf of the Department of Trade and Industry.

Top of Page

The state-owned Industrial Development Corporation provides financing to the private sector to facilitate commercially sustainable industrial development and innovation to the benefit of South Africa and Southern Africa. Finance is in the form of equity, quasi equity and medium-term loan finance. Interest rates are competitive and risk related and are based on the prime bank overdraft rate.

The IDC offers specific financing products:

  • Bridging Finance: for entrepreneurs who have secured firm contracts - except for construction contracts - with government and/or the private sector and which have short-term financing needs;
  • Financing for empowerment: for emerging industrialists/entrepreneurs who wish to acquire a stake in formal business by way of management buy-ins or buy-outs, leveraged buy-outs or strategic equity partnerships;
  • Financing for small-and medium-sized mining and beneficiation: is aimed at small-and medium-sized mining and beneficiation activities and jewellery manufacturing activities;
  • Financing for the development of the techno-industry: is aimed at entrepreneurs in the IT, telecommunication, electronic and electrical industries wanting to develop or expand their business;
  • Financing for the development of agro-industries: for entrepreneurs in the agricultural, food, beverage and marine sectors wanting to expand and develop their businesses;
  • Financing for the development of the tourism industry: is aimed at commercial projects in the medium to large sectors of the tourism industry;
  • Financing for the expansion of the manufacturing sector: is aimed at entrepreneurs wishing to develop or expand their manufacturing business and create new or additional capacity;
  • Wholesale finance: for intermediaries looking for wholesale funding to lend to individual entrepreneurs;
  • Financing for the export of capital goods: for manufacturers and providers of exported capital goods or services. The aim is to provide competitive US dollar and rand financing to prospective foreign buyers of equipment;
  • Import credit facilities: for local importers of capital or services requiring medium- to long- term import credit facilities;
  • Short-term trade finance facilites: for exporters looking for short-term working capital facilities to help them facilitate export orders; and,
  • Project finance: is aimed at large projects in the Metals, Petro and Chemical, Manufacturing, Agriculture, Minerals and Mining, and Energy market segments.

Top of Page

INTELLECTUAL PROPERTY AND SPECIALISED LICENSES

Intellectual property

South Africa has a developed system of intellectual property law covering patents, industrial designs, copyright and trademarks. It is also a signatory to most of the international conventions in this field.

Patents:
Patents are granted for inventions that have not been previously known and that differ adequately from what was previously done along the same lines and are protected and registered in terms of the Patents Act, No. 57 of 1978. An application for a temporary patent, with a duration of one year, can be made by an individual, the cost of which is R60.00. Before the expiry of a temporary patent, a patent attorney/agent must file a complete patent application, which costs R266.00.

It takes twelve (12) to eighteen (18) months to obtain a patent in South Africa. Patents last for twenty (20) years from the date of application. Subject to payment of prescribed renewal fees.

Patent Cooperation Treaty (PCT):

PCT is an international patent filing system. This treaty allows an individual of a member state to lodge an application by filing one international patent application and simultaneously seeking protection for an invention in each of a large number of countries. Any national or resident of a PCT contracting state (e.g. South African national or resident) can file an international application at the Receiving Office: South African Patents Office and seek protection in all other countries that are members of the treaty.

Benefits of the PCT System:

  • No representation required (attorney/agent is optional);
  • There is no multiple search;
  • One month to pay filing fees;
  • Protection will be granted in 109 member states;
  • Filing one single application in triplicate; and,
  • Nationals and residents of South Africa are entitled to a reduction of 75% of the international fee.

For more information on filing fees, please contact the South African Patents Office.

Designs:
Designs incorporating the visual or aesthetic appearance of an article are protected and registered in terms of the Designs Act, No. 195 of 1993, provided that it is new in comparison to that previously known on articles of a similar nature. Designs are divided into aesthetic and functional designs. Any individual may file for a design; an attorney is not required. The cost of a design application is R110.00. The duration of registration is fifteen (15) years for aesthetic designs and ten (10) years for functional designs, both renewable at a prescribed renewal fee.

Copyright:
Artistic works and other works containing intellectual content such as literary works, music, cinematographic films, sound recordings, drawings (including engineering drawings), plans, computer programmes, pictures of all forms and numerous other two-dimensional and three-dimensional articles having intellectual content are protected by copyright under the Copy Right Act, No. 98 of 1978. Copyright is different from other forms of intellectual property in that it exists automatically and no steps need to be taken, in South Africa, to register it, although in the exclusive case of video recordings and cinematographic films, the copyright can be registered. Copyright endures for fifty (50) years. Cost for cinematographic films is R231.00.

Trademarks:
Trademarks may be registered under the Trademarks Act, No. 194 of 1993. After an initial term of ten (10) years, a trademark may be renewed for a further 10-year period. Being registered as a trademark protects the name or logo in association with which an article is marketed, or a service is rendered, and even the shape of a special container.

An attorney is not required to file for a trademark. A thorough preliminary trademark search, conducted by an experienced individual, can ensure against possible conflicts, thereby preventing the prolonging of an already lengthy process. The office of the registrar will, on request, do an in-depth search as to possible conflicts for a fee of R85.00.

The application fee is R266.00. On average, approval requires at least two (2) years, but a business may trade during that period.

All applications may be lodged by hand or by post with the registrar and fees are payable in revenue stamps, excluding the PCT patent applications.

Contact information:
Office of the Registrar
Patents, Trademarks, Designs and Copyright
Department of Trade and Industry
Private Bag X400
Pretoria 0001
Telephone: 0861 843 384

Top of Page

Cellular licenses

All wireless transmission, ranging from cellular to VHF two-way radio to datapacket, is regulated by a newly formed regulatory body, the Independent Communications Authority of South Africa (ICASA), which was formed through the merging of the Telecommunications and Broadcasting regulators. ICASA's Telecommunications functions were previously administered by the South African Telecommunications Regulatory Authority of South Africa (SATRA) since 1997, and prior to that by the Ministry of Posts and Telecommunications, which also managed Telkom, the nation's Public Switched Telecommunications Network (PSTN) operator.

The Telecommunications Act 103 of 1996 determines the procedures for the application of specialised licenses, e.g. cellular licenses, but application for these types of licenses can only be made on invitation from the Minister for Communications.

The procedures for licensing PABX systems and VHF radios remain the same as in the past. In almost all cases, the equipment supplier handles licenses for small-scale communications tools.

Contact information
ICASA - Independent Communications Authority of South Africa
Physical address:
Blocks A, B, C&D, Pinmill Farm, 164 Katherine Street, Sandton
Postal address:
Private Bag X10002,Sandton, 2146
Telephone: +27 (11) 321-8200
Fax Number: +27 (11) 444-1919
Communications Tel: +27 (11) 321-8434
E-mail address: info@icasa.org.za
Website: http://www.icasa.org.za

Banking licenses

A company wishing to conduct banking operations in South Africa has three alternatives. All of these require the approval of the Registrar of Banks, who heads up the Banking Supervision Department of the Reserve Bank.

The three options are:

  • A separate banking company;
  • A branch of an international bank or banking group; and,
  • A representative office of an international bank.

To establish a separate banking company, the investor must begin by incorporating a public company with the Registrar of Companies. The greater of R250 million or 8% of risk-weighted assets is required as capital to establish a bank (this percentage could be amended in line with international practice). The investor must then supply the information required by the Banks Act with the application form DI 002 for a banking licence. The following information must be included:

  • Details of the applicant and the proposed bank, including notice of registered office and postal address of company;
  • Memorandum and articles of association;
  • Certificate of incorporation;
  • Business plan (including predominant business activities planned, schematic representation of group structure, dividend policy, auditors, risk management policy and names of directors and executive directors);
  • A number of Banks Act Returns, referred to as "DI Returns", to forecast the position for the ensuing year are required. The forecast DI Returns required are those dealing with the balance sheet, off-balance sheet activities, income statement, liquidity risk, capital adequacy, trading risk, and restriction on investments, loans and advances;
  • Curriculum vitae of proposed directors and executive officers;
  • Application for approval of appointment of auditors;
  • A report from a public accountant on funds received from anticipated shareholders and held in trust;
  • Planned internal audit activities; and,
  • Application for permission to acquire share in a bank.

Should a foreign bank seek to establish a subsidiary or a branch in South Africa, the procedures are similar to those for other investors set out above. However, foreign banks are also required to include the following with their application:

  • Foreign bank holding company resolution approving proposed formation of a bank;
  • Letter of comfort and understanding from foreign bank holding company;
  • Letter from the foreign bank's home regulatory authority to the effect that it has no objections to the application and that it will comply with certain minimum standards of supervision; and,
  • Board minutes from the holding company empowering an official to sign all documents relating to the application.

Approval time for a banking company, a foreign subsidiary or a branch depends on the quality of the application. Banking licenses are not transferable.

The requirements for establishing a representative office are less onerous and it takes considerably less time to obtain approval for a representative office. Representative offices cannot take deposits, but can merely act as information conduits to the parent company.

Contact information:
The Registrar of Banks
Bank Supervision Department
South African Reserve Bank
P O Box 8432
Pretoria, 0001
Telephone: +27 (12) 313-3770
Facsimile: +27 (12) 313-3758

Top of Page

PROSPECTING AND MINING RIGHTS

The mineral industry in South Africa is mainly regulated by three acts. The Minerals Act, 1991, regulates prospecting for and optimal exploitation of minerals and the rehabilitation of the surface of land during and after prospecting and mining operations. The Diamonds Act, 1986, controls the possession, purchase, sale, processing and export of diamonds. The Mine Health and Safety Act, 1996, provides for the protection of the health and safety of employees and other persons at mines. The Minerals Act and the Mine Health and Safety Act are administered by the Department of Minerals and Energy, while the Diamonds Act is administered by the South African Diamond Board.

The concept of mineral rights, as is known in South Africa, can be regarded as an indigenous development as a result of the mineral wealth of the country and the need which arose to exploit minerals and to grant rights in respect of minerals.

It is defined as a limited real right in property which entitles the holder thereof or the person who has acquired the consent of such holder to go upon the land and search for minerals, remove and dispose of them.

Top of Page

Mineral Rights
Registration particulars in respect of mineral rights can only be obtained from the relevant deeds offices.

Under Section 5 of the Minerals Act, the holder of minerals rights, or any person who has acquired the consent of such holder, has the right to conduct prospecting or mining operations subject to being granted the necessary prospecting permit or mining authorisation from the Department of Minerals and Energy. If the State is the holder of the mineral rights, the prospective applicant is required to obtain the requisite consent from the Minister of Minerals and Energy by concluding a contract (prospecting contract or mineral lease agreement) with the State.

Procedures
The Department of Minerals and Energy has regional offices in each province, headed by a Director of Mineral Development.

Once the permission of the mineral rights holder has been obtained, an application for a prospecting permit or mining authorisation may be lodged with the Director of Mineral Development at the Department of Minerals and Energy. The director evaluates the application, giving special attention to the manner in and scale on which it is intended to prospect or mine the mineral concerned, and to the manner in which the applicant intends to rehabilitate the land involved.

The Minerals Act requires that the holder of a prospecting permit or mining authorisation shall submit an environmental management programme (EMP) to the aforementioned director for approval, and no operations may be commenced until such approval is obtained. In order to speed up the approval process, the EMP is usually submitted at the same time as the application for a prospecting permit or mining authorisation.

To ensure that all aspects of the environment are considered, the Act stipulates that before the director approves the EMP, he is required to consult with each department charged with the administration of any law relating to the environment. Approval of an EMP may therefore take a considerable period of time. However, the legislation does provide for the granting of temporary permission to proceed with prospecting mining operations, but such permission will only be granted after consultation with other departments and under stringent conditions.

Top of Page

Export of Minerals
The export of minerals is not prohibited by the Minerals Act. However, the export of diamonds is controlled in terms of the Diamonds Act. The export of tiger's eye and sugelite (also known as lavulite or lazulite) is controlled by export control regulations promulgated under the Import and Export Control Act, 1963. In terms of the said regulations, as amended in 1992, only properly processed tiger's eye articles, as defined in the regulations, may be exported without an export permit being obtained. An export permit in respect of tiger's eye or sugelite is issued on the recommendation of the Department of Minerals and Energy. Although the Department of Trade and Industry issues such export permits, the permission of the Department of Minerals and Energy, as controlling authority, must be obtained beforehand. Any queries regarding the export of a particular mineral may be directed to the Department of Trade and Industry.

Contact Information

Department of Trade and Industry
Tel: 0861 843 384

Directorate: Mining Rights
Department of Minerals and Energy
Private Bag X59
Pretoria 0001
Telephone: +27 (12) 317-9029
Facsimile: +27 (12) 322-8955

Top of Page

LAND - ACQUISITION, REZONING, SUBDIVISION AND TRANSFER

Investors face a wide array of possibilities when choosing land for development in South Africa. Private, state, provincial, municipal, and parastatal landholdings are all potentially available for commercial development - each with their own application process. In practice, the specific details of this process are determined and administered by the relevant municipality concerned.

Acquiring and disposing of land

Commercial real estate is well developed in South Africa, with private landholdings in both urban and outlying areas. The availability of industrially zoned and serviced land varies by location. Property owners, brokers, managers and developers who are members of the Property Council of South Africa are available to assist investors in locating, leasing, buying and selling private property. Any of these bodies can be contacted through the Property Council of South Africa.

Should any service providers be required, please contact the address given below. Alternatively, peruse the website for further information.

Contact information

Property Council of South Africa
Managed by Avian Management Services (Pty) Ltd
P O Box 78544
Sandton, 2146
Telephone: +27 (11) 883-0679
Facsimile: +27 (11) 883-0684
E-mail: ceo@procsanet.org.za
Website: http:\\www.procsanet.org.za

Top of Page

Acquiring publicly held land

The process of acquiring publicly held land tends to be significantly slower than with private landholdings. Efforts are under way throughout much of South Africa to make more public land available for private purchase.

State Land
All purchases or leases of State land are subject to tender. Two scenarios exist for the acquisition of State land:

  1. The application by an investor or developer for the use of a particular plot of State land; and,
  2. A response by an investor to an invitation by government for bids to develop land.

If an investor identifies a plot of land belonging to the State, he must provide a detailed proposal as to how the land will be used. The proposal should include:

  • A description of the land (available from the deeds office);
  • Context of the land (within a municipality, town, etc.);
  • A description of the investment and how it would facilitate development in the region;
  • Time frames for development; and,
  • Participation of South African citizens in ownership, management, and/or marketing.

Upon receipt of the proposal by the Department of Public Works, the following occurs:

  • The land is evaluated to determine whether a freehold sale or long-term lease would be more appropriate;
  • The property is advertised for six weeks for competing developers to respond;
  • A valuation by an independent valuer is carried out;
  • The proposal (and any others received from the advertisement) is evaluated by the evaluation committee; and,
  • The sale is then signed by the Minister of Public Works.

The process will usually take from three to six months to complete.
"Legal requirement" i.s.o. accepted practice.

Investors should note that land belonging to many agencies and institutions is subject to a fallback clause. Should any land that is owned by an institution, such as a university, be used for any purpose other than intended, title reverts back to the State. This can cause delays for an investor to acquire land from government organisations.

The Department of Public Works has begun identifying land for development. This land is advertised and responses are invited from the development community. The tender will have a specific form in addition to the information listed above. The process will take three (3) to six (6) months to complete.

Contact information:

Department of Land Affairs
Room 138, Old Building
Cnr Jacob Mare & Bosman Street
Pretoria
Telephone: +27 (12) 312-8911
Facsimile: +27 (12) 312-8066

Provincial Land
In most cases, any sale of provincial land requires a tendering procedure. An investor may identify a site and apply for the use of the site. The application should be made by letter, and the investor must identify the use of the land; the background of the company; the shareholding of the company; and, the company's financial projections. The land is then advertised for tender, and a provincial committee evaluates the responses. Responses are usually judged on project viability, social impact, environmental impact, and best use of the land, although there are no set criteria. The process can take between six (6) and eighteen (18) months, depending upon the province.

Municipal Land
Local authorities are major holders of public land. Land development falls under the jurisdiction of the relevant municipal council. Municipalities vary greatly in their approach to development - in terms of governing legislation, attitudes and processing systems.

In terms of legislation, some municipalities permit the direct negotiation of land sales, while others require tendering in some or all cases. Tendering typically requires a period of twelve (12) to eighteen (18) months, although the process can be completed in as little as six (6) months. Direct negotiation tends to be significantly quicker, though such agreements may also be subjected to a period open for community objections and appeals.

Top of Page

Rezoning and subdivision of land

Any requests for the rezoning or subdivision of land, regardless of land ownership, must be submitted to the local authorities. Specific application processes vary from jurisdiction to jurisdiction, though typically the applicant must submit a rezoning application, statement of motivation, and a processing fee. The rezone request is advertised for three (3) weeks, after which objections are sought from parties affected by the rezoning. In some cases, the investor is invited to respond to the objections.

The application is then reviewed, by either a committee or an engineer, depending on the municipality. Re-zoning applications can take from as little as three (3) weeks to as long as six (6) months in larger cities.

Transfer of land

Whether land is purchased from private or public sources, the process of transfer of ownership is the same. All land in South Africa, public and private, has been surveyed, beaconed, and assigned plot numbers by the Surveyor General's Office. The role of the Deeds Office in the transfer process is two-fold: (1) to guarantee the title deed, and, (2) to maintain a registry of deed holdings. There are nine regional Deeds Offices throughout South Africa.

The investor, though, has no direct interaction with the Deeds Office. Instead, the transfer of ownership is handled by conveyancers. It is the accepted practice in South Africa that the seller appoints the conveyancer who attends to the transfer of the legal title in the name of the purchaser and has the responsibility to protect the interests of both the seller and the purchaser.

The conveyancer draws up a deed of transfer based on the existing owner's title deed and attends to the registration of the final document with the Deeds Office.

The conveyancer must submit the following to the Deeds Office for registration:

  • Deeds of transfer;
  • Title deed (from owner);
  • Power of attorney;
  • Rates clearance certificate if applicable; and,
  • Transfer duty receipt or exemption certificate.

The purchaser pays the costs of transfer, including the conveyancer's fee. Should a mortgage bond be registered over the property as security for the advancement of the purchase price, the bank or financial institution will instruct its conveyancer to register the mortgage bond.

The bank's conveyancer will lodge the following documents to be registered simultaneously with the transfer documents:

  • Mortgage bond; and,
  • Power of attorney.

The mortgagor pays the costs of registering the bond as well as the stamp duty. Should the property being transferred be encumbered by an existing mortgage bond, the financial institution in whose favour it is registered will, after the necessary financial arrangements have been made with the seller, instruct it's attorney to cancel the mortgage bond. This is done simultaneously with registration of transfer of the property. The costs relating to the cancellation are payable by the seller.

Depending on the workload at the Deeds Office, the documents will be in the system after lodgement for a period ranging between two (2) to three (3) weeks.

Fees, Taxes and Transfer Duty

The rate of transfer duty payable depends on the nature of the purchaser. If the purchaser is a company, close corporation or trust transfer duty at a flat rate of 10% of the purchase price is payable. An individual pays transfer duty on a sliding scale from 1 to 8% of the purchase price, depending on the value of the property transferred. The conveyancer will obtain a receipt for the payment of the transfer duty from the Receiver of Revenue for lodgement with his transfer documents at the Deeds Office. Should the seller be registered for VAT, for example a developer, no transfer duty will be payable by the purchaser, as the seller would have to include the VAT amount in the purchase price.

In this case the conveyancer will obtain a transfer duty exemption certificate from the Receiver of Revenue for lodgement with his documents. The purchaser must provide the conveyancer with the transfer duty payable to the Receiver of Revenue prior to registration of the transfer.

Legal protection of property rights in land
Security of tenure in landholding is provided for in Section 25 of the Constitution of the Republic of South Africa, Act 108 of 1996.

Stamp duty
Stamp duty is payable on the registration of mortgage bonds. The rate at present is R0,20 per R100,00 or part thereof, of the capital amount being secured by the mortgage bond.

Conveyancing fees
Conveyancers charge fees for the work they do in the Deeds Office on behalf of their clients. The fees charged are in accordance with guidelines laid down by the Association of Law Societies from time to time.

Deeds Office fees
The Deed Office will charge the conveyancer a registration fee for each transaction registered. This fee is included in the conveyancer's account to the purchaser and varies from R55.00 to R500.00 depending on the nature and value of the transaction.

The average time required for the complete transfer process - including bond approval, the drafting of the deed and registration with the Deeds Office - is approximately two (2) to three (3) months.

Contact information:
Mr G. J. Cloete
PO Box 61873
Marshalltown
2107
Telephone: +27 (11) 378-2111
Facsimile: +27 (11) 378-2100

Top of Page

SITE DEVELOPMENT

Although the procedures for developing a site are generally consistent throughout the country, the specific steps an investor must take are defined by the individual municipality or local authority. In most cases, the approval of plans, the assessment of environmental impact, and the provision of utilities, including water, sewerage, and electricity, are handled exclusively by the municipality concerned. In general, in areas where land is already serviced and no upgrades are required, utility hook-ups are fairly simple and swift. Where capacity upgrades or servicing is required, the wait for connections may be longer.

Building permits

Building permits are issued by the municipal authority with jurisdiction over the particular site. Each municipality has its own application process. Most applications must meet both the building codes of the municipality, and the national codes set out in the National Development Act. The Act specifies that each structure conforms to over 20 requirements. Decisions to consult with exterior bodies, such as the Department of Health, local fire department, and Ministry of Environment and Tourism, are made by the engineer in the local authority.
The following areas are included in the approvals:

  • Fire;
  • Pollution control;
  • Health impact;
  • Frontage works;
  • Elevation control;
  • Drainage and coastal engineering;
  • Roads;
  • Sanitation;
  • Sewerage reticulation; and,
  • Structures.

Once the plans are approved, the municipality conducts a minimum of five inspections of the building site. Some municipalities conduct more, especially in the case of a multi-storey building. Other inspections may be carried out from time to time, depending upon the specifics of the building.

Top of Page

Environment assessments

Some applications for building permits will require an environmental impact assessment. The assessment must be carried out by an environmental consultant at the expense of the landowner. Some investors have recently carried out social impact assessments as well. It has been estimated that the environmental impact assessments cost up to 5 per cent of the investment.

There is no established criterion for determining when an assessment is required. Assessments are carried out at the request of the municipality, although some investors have been required to carry out assessments as a result of environmental activist pressure. Companies are advised to carry out assessments before the erection of a manufacturing or processing plant.

Electricity connection

Eskom, a State-owned enterprise, generates most of the electricity in South Africa. Eskom sells to local authorities, who act as redistributors. The local redistributors, in turn, supply the majority of electricity to end-users. There are approximately 450 local redistributors. Eskom, in certain cases, does sell directly to the end-user: (1) when the local redistributor is unable to meet the needs of heavy electricity users, or (2) when no local redistributor has jurisdiction over a particular geographic area.

Procedures
The application and installation procedures are simple and swift for a site with an existing structure and an adequate electrical supply already in place, i.e. where no equipment upgrades or added infrastructure is required. An application for the supply of electricity should be submitted to the nearest Eskom sales office at least seven (7) days prior to the requested connection date. Connection fees range from R2 000 - R4 000, depending on the category of service (standard users, off-peak users, or peak users). A cash deposit or bank guarantee may also be required to cover costs in event of non-payment.

Eskom is also able to meet the needs of investors who require capacity upgrades, such as for energy-intensive factories. For capacity upgrades, the waiting time depends on the availability of the size of transformer required. Costs are also dependent on the size of the upgrade.

The utility is also able to supply greenfield sites in serviced areas. However, investors should prepare their applications well in advance, as installation can take up to twenty-four (24) months for large projects. Investors may submit either an application for the supply of electricity or a letter of requirements to the nearest Eskom office. Eskom will provide an estimated quote of installation costs within fourteen (14) days of the initial application. The quote is subject to negotiation.

Redistributors: The application, procedures and fees in areas not covered by Eskom are defined by the individual redistributor. Connection times and tariff structures vary widely.

Smaller communities generally do not have the capacity to handle major industrial applications. Eskom provides the additional infrastructure to the municipalities in the event of an increased requirement.

Top of Page

Water connection

Water connections are generally provided by local municipalities. Connection times are usually fast, with the exception of those sites not serviced. The time required for connection times to serviced sites ranges from one (1) day to two (2) weeks. Times required for connection to unserviced sites ranges from one (1) month to one (1) year and more.

Telephone connection

Telkom can usually provide a line within one week if lines are in place. It has established seven call centres across South Africa and in many cases can connect a line within one day.

The connection fee is R150 for the first line and R135 for any additional lines. It will usually dispatch a sales representative for any request for more than three lines.

Any investor must provide a surety from a South African citizen. Failure to acquire a surety will require a deposit of R1 000.

If an equipment upgrade is required, Telkom can upgrade a facility within four months, depending on the need. No additional fees are required, unless the upgrade is not in Telkom's strategic plan. If the upgrade is not within its strategic plan, Telkom will base its fees on a cost recovery basis. No special forms are required.

Telkom can provide a number of means by which an investor can receive telecommunications services in an unserviced area, but it requires approximately two to four months, depending upon the type of solution. Radiophone systems are installed in a number of remote areas around South Africa.

Top of Page

IMPORTING AND EXPORTING

Customs procedures affect new business operations in many areas. Most firms rely on imports for initial capital equipment and for needed production materials and supplies. Exporting firms rely on timely clearances to expedite shipments and for documentation to secure rebates.

Import permits

Most goods may be imported into South Africa without restriction. However, the importation of certain goods specified by government notice is permitted only subject to the issuance of an import permit. All second-hand goods, including waste and scrap of whatever nature, require an import permit. For goods subject to restriction, importers must be in possession of the required permit before the date of shipment. The Directorate of Imports and Exports controls the issuance of permits, though additional and prior authorisation may be required from other departments with jurisdiction over the control of the goods in question.

The permit can be acquired within fourteen (14) days, depending to the nature of the application. For a complete list of goods currently subject to import control, an importer should approach the Directorate: Import and Export control of the Department of Trade and Industry. There is no fee applicable. Permits are valid from the date of issue until the end of the calendar year.

Importers must also register with the Commissioner for Customs and Excise. (See section on registration procedures below.)

Applications should be filed with the directorate at least two weeks prior to the date of shipment in order to ensure approval in time for shipment. A complete application should include the following:

  • Application for import/export facility; and,
  • Other information regarding the goods, depending upon the controlling body.

Top of Page

Export permits

A number of products are currently subject to export control and licensing. Exporters should apply directly to the government agency that controls the specific permit in question. Currently restrictions exist on strategic goods (exhaustible resources); agricultural products administered by control boards; and metal waste and scrap. Metal scrap must first be offered to downstream manufacturers at a discount to the price at which it can be exported (15 % discount for non-ferrous; 7,5 % for ferrous). If manufacturers turn down the offer, an export permit may be issued.

Exporters must also register with the Commissioner for Customs and Excise. (See section on registration procedures below.)

Complete export prohibitions are at present in place for ostriches and their fertilised eggs (not in terms of the Import & Export Controls Act).

The application procedure and time required for filing is the same as for import permits.

Contact information:
Directorate Import and Export Control
Department of Trade and Industry
Private Bag X192
Pretoria 0001
Telephone: 0861 843 384
International callers: +27 (11) 254-9405

Registration as importer/exporter

All importers and exporters in South Africa are required to register with the Commissioner for Customs and Excise. Form DA163 covers importers and exporters, as well as clearing agents and warehouse licensees. Forms are submitted to the Customs Commissioner's Office in Pretoria, and may be submitted by fax. Upon registration, applicants are issued with a customs code number. The registration process can take as little as one day, though traders are permitted to use a general code number issued by Customs in order to begin importing or exporting immediately if required.

Top of Page

Customs clearance procedures

Import process
The clearance of imported goods generally takes a maximum of twenty-four (24) hours for air freight and two (2) to three (3) days for sea freight, depending on the port of entry. All required documentation must be submitted to Customs and Excise before goods can be cleared through customs. Most transactions are covered by a bill of entry, Form DA500.

Other required documentation includes:

  • Commercial invoice;
  • Prescribed certificate of origin when preferential duty rates are claimed;
  • Negotiable copy of bill of lading or equivalent document;
  • Import permit, if required;
  • Rebate permit 470.03, if applicable (for raw materials to be processed and re-exported - see below); and,
  • Payment, by a bank guaranteed cheque, for all applicable duties and taxes (including VAT), if not qualified for a deferment.
Import shipments may be cleared through customs prior to the goods arriving at a South African port. In order to avoid unnecessary delays, an importer may wish to submit an application for a tariff heading. These can be acquired from the Commissioner of Customs in Pretoria.

In the case of sea freight, once customs has been cleared, the importer must pay dues to Harbour Revenue, and receive a wharfage order. The importer then pays the operator and receives a release. At this point, the importer can go to the terminal and collect his goods.

Use of a freight forwarder is strongly recommended by Customs. Freight forwarders commonly apply for all licenses and registration numbers. They can apply for tariff headings, and provide assistance in properly classifying goods. Through the use of technology, they can clear goods more quickly than an individual investor, and provide ground transport for the goods to reach the investor.

Export Process
All required documentation must be submitted to Customs and Excise before goods can be cleared through customs. Most transactions are covered by a bill of entry, Form DA550. Customs can process paperwork within twenty-four (24) hours.

All exports must reflect payment from the receiver of the goods. Exporters must complete Form F-178, available at commercial banks. Commercial banks, acting as agents of the Reserve Bank, approve the form.

Other required documentation includes:

  • Export invoice; and,
  • Export permit, if required.

Electronic processing
The larger district Customs offices accept electronic versions of required documentation to expedite the clearance process. Currently, electronic data is exchanged through floppy disks and the record format must conform to department specifications. The electronic version must still be accompanied by a paper version, as a paper document is still regarded as the legal declaration.

To facilitate clearance, Customs and Excise, in co-ordination with Portnet and Spoornet, has also introduced electronic processing for the clearance of containerised cargo through a select number of district offices. Customs electronically communicates its instructions directly to the depot or terminal operators.

Customs and Excise is upgrading its technology and information systems. Plans in the near future include a move to Electronic Data Interchange (EDI) technology to facilitate the clearance process. The greatest beneficiaries of the new technology will be the large clearing agents who are fully equipped with appropriate systems. Nevertheless, the Customs department is committed to a guaranteed 24-hour clearance of air freight.

Contact information:
South African Revenue Service
Private Bag X47
Pretoria 0001
Telephone: +27 (12) 422-4000
Facsimile: +27 (12) 422-6991

Top of Page

Deferment of payment scheme

A deferment scheme is available to qualified importers that allows the deferment of applicable import duties, surcharges, and VAT. Payment is generally deferred for thirty (30) days and seven (7) days to settle the account. To apply for deferment, importers may apply to the local Customs Controller. Required documentation includes:

  • Application for deferment;
  • Statement of income;
  • Balance sheet.

The local Controller will make its recommendation to the Commissioner of Customs and Excise. Following approval, the applicant will be required to submit additional documentation, including a signed agreement and any required surety bond.

Duty drawback scheme

A duty drawback scheme provides refunds for import duties paid on materials used in the production of an export. Manufacturers may apply for refunds upon export of the final product. Manufacturers must provide proper documentation to reconcile imported materials with exports.

Bonded warehouses

Secure bonded warehouse facilities are available at all points of entry and may be used to store imported goods without payment of duties until required for use, resale, or re-export. Goods withdrawn from a bonded warehouse are liable for the duty applicable only if cleared out of bond for home consumption.

Top of Page

Manufacturing under rebate programme

South African Customs and Excise also administers a programme for manufacturing under rebate, whereby manufacturers may claim a rebate on imported materials used in the production of exports. Imported materials must be used within twelve (12) months.

This facility is exclusively export driven, and to qualify manufacturers must have secure facilities on their premises for the storage of dutiable materials. The room is subject to inspection by Customs. It is recommended that building plans be submitted to Customs prior to construction to ensure that all requirements are met. Upon approval, manufacturers are also required to draw up a bond. The entire process can take from two (2) weeks to two (2) months, depending on the length of time required to obtain the bond. If the process needs to be expedited, Customs will accept a cash deposit until the bond is obtained.

Manufacturers are required to submit reconciliation statements to Customs within twelve (12) months of the date of importation of imported materials.

Clearing agents

Clearing agents/customs brokers are available throughout South Africa to attend to all formalities necessary for the clearance of goods through customs, including any required permits, documentation, payment of duties, port charges, forwarding, and transport costs. In addition to registering for a customs code, clearing agents are required to put up a bond.

Top of Page

TAX AND REPORTING

Tax registration for business

New enterprises must file with the South African Revenue Services (SARS) for the following taxes: provisional income tax; value-added tax (VAT); and, employees' tax (SITE and PAYE). The Regional Services Levies are payable to the Regional Services Councils.

For purposes of tax administration, South Africa is divided into 44 geographic areas. Local Receivers of Revenue in each area are responsible for the routine collection of taxes. All the Receivers of Revenue are grouped under five Regional offices and SARS Head Office is situated in Pretoria.

Registration
All business enterprises are required to register as provisional taxpayers in order to account for the income tax due on income derived from carrying on trade in South Africa.

For corporate entities, the Registrar of Companies or Close Corporations notifies SARS of the incorporation of a new business enterprise once the registration procedures with the relevant Registrar's office have been processed. The business entity is then automatically registered as a provisional taxpayer and issued a registration number. Every enterprise must appoint a public officer within one (1) month after commencing business activities in order to represent it in all dealings with the revenue authorities. The public officer is designated as representative taxpayer in respect of the income and related tax obligations of the entity. The individual appointed as public officer must reside in South Africa and the Commissioner for SARS must approve the appointment.

Reporting
Business entities are required to file annual income tax returns with SARS. Most file their returns with the Receiver of Revenue in the jurisdiction in which they operate. Some larger companies (with turnovers exceeding R100 million per annum), though registered locally, are required to file their returns with the Receiver of Revenue in Sandton, a centre better equipped to handle the financial returns of larger enterprises.

Each business entity may select its own financial year-end. Natural persons are not entitled to this privilege - their tax year runs from 1 March to 28 February. Two provisional tax payments based on an estimate of annual income are made during each financial year. The first provisional payment is made after six (6) months of the current financial year have elapsed, the second at the end of the financial year. For the first payment, the estimate of taxable income may not be less than the "basic amount" - the taxable income reflected in the most recent assessment received from the Receiver of Revenue. In the case of a new enterprise, the basic amount will be nil. If, at the time of making the second provisional payment, the estimate of taxable income is less than 90% of the actual taxable income for the year and less than the basic amount, the taxpayer will be liable for an additional penalty tax of 20% of the difference between the actual tax paid and the lesser of the tax on the basic amount and the tax on 90% of the actual taxable income. To avoid this, it is best to base the estimate for the second provisional payment on the basic amount. A third payment may be made six (6) months after the financial year-end for corporate entities and seven (7) months thereafter in the case of natural persons, to reconcile estimated income with actual income.

Interest accrues from the due date of the third payment on any underpayment of tax for the year concerned.

For corporate entities, a copy of the audited financial statements of the enterprise, signed by the auditor and the public officer of the enterprise, must accompany the return, as well as any other documentation necessary to support the information contained in the return.

The aim of SARS is to issue assessments within three (3) months after the filing of returns. New technology is being introduced to assist this process.

The investigation division of SARS assesses all income tax returns referred to them by the local tax offices. The department also conducts detailed tax audits on a random basis and in circumstances where it is suspected that a return contains material irregularities or omissions.

Taxable Income
Income tax is calculated on an enterprise's taxable income earned from South African sources. The rate of corporate income tax was recently reduced to 30% (previously 35%), with effect from the years of assessment ending during the period 1 April 1999 to 31 March 2000.

Secondary tax on companies (STC), an additional tax on the income of companies, is imposed at the rate of 12,5% on the net amount of dividends declared (dividends declared less dividend income) by a company or close corporation.Companies effectively managed outside South Africa, which carry on trade through a branch or agency within South Africa, are exempt from STC on dividends declared during any year of assessment ending after 31 March 1996 out of profits derived through the South African branch or agency. However, beginning with years of assessment ending 1 April to 31 March 2000, these companies pay normal income tax on their South African source profits at a flat rate of 35%.

The tax rates applicable to the income of natural persons for the tax year ended 28 February 2000 range from 19% on taxable income up to R33 000 to the maximum marginal rate of 45%, which applies to income in excess of R120 000. All natural persons are entitled to a primary rebate of R3 710 in respect of their annual tax liability. Persons over the age of 65 years are entitled to an additional annual rebate of R2 775.

Top of Page

Capital Gains Tax

Capital Gains Tax (CGT) Act was implemented on 1 October 2001. Income tax is a tax on income earned. CGT forms part of the income tax system and is a tax on the profits you make from selling something that you own [that is not otherwise taxed].

If you have any questions in this regard, contact the South African Revenue Services:
Website: http://www.sars.gov.za;
E-mail: cgt@sars.gov.za.

Value added tax

Business entities conducting enterprises in the course of which the total value of taxable supplies made exceeds R150 000 in any 12-month period are required to register for VAT. Voluntary registration is permissible for those with turnovers of less than R150 000.

Registration
Registration for VAT must be effected either at the end of any month in which the total value of taxable supplies made by the enterprise for the preceding 12-month period exceeds R150 000 or at the commencement of any month in which it is reasonable to conclude that the total value of supplies to be made in the coming twelve (12) months will exceed R150 000. The enterprise must have an active bank account before registering. The registration application must be accompanied by the following documentation:

  • Registration Form VAT 101;
  • Bank statements or cancelled cheque of enterprise;
  • Certified copies of ID documents of public officer of company, members of close corporation, or partners of partnership; and,
  • Certified copies of:
    • Articles of association of company
    • Founding statement (CK1) of close corporation, or
    • Partnership agreement of partnership.

Reporting
VAT returns normally cover a two-month period and account for VAT on the supply of goods or services on an invoice basis. They must be submitted to SARS together with payment of any VAT due by the 21st day of the month following the end of the return period. A VAT vendor who is a natural person or an unincorporated body of natural persons, the taxable supplies of whom do not exceed R2,5 million annually, may apply to account for VAT on the payments basis as opposed to the invoice basis. Remittances are filed using VAT Form 201. SARS conducts VAT audits on randomly selected vendors.

VAT Rates
The standard rate of VAT on the supply of goods and services is 14%. The supply of certain goods and services is exempt from VAT (e.g. the supply of financial services). Similarly, certain supplies are zero-rated (e.g. exports, sale of a business as a going concern).

Top of Page

Employee tax

All enterprises with employees must register as employers and account for employees' tax [standard income tax on employees (SITE) and pay as you earn (PAYE)]. The main exception to this is directors of private companies whose emoluments are not subject to employees' tax and who are required to register as provisional taxpayers.

SITE is a tax on net remuneration. Net remuneration represents income earned from employment less deductions for pension fund and retirement annuity fund contributions. Where an employee's net remuneration is R60 000 or less, only SITE is payable. Such an employee need not render returns and will not be subject to assessment (assuming that they earn no other income). If an employee's net remuneration for the year exceeds R60 000, employee's tax will comprise both SITE and PAYE. Such employees are required to render tax returns and are subject to assessment. The employees' tax withheld by the employer will be credited against the tax assessed. In the event of the assessed tax being less than the SITE paid, no refund of SITE will be made, although overpaid PAYE will be refunded.

Registration
Employers must register with their local SARS office (using Form IRP 101). Registration must be effected within fourteen (14) days after the liability to pay any amount by way of remuneration arises.

Reporting
Employers are required to deduct employees' tax from employees' remuneration on a monthly basis. Employers must pay the tax to SARS within seven (7) days of the end of the month in which the tax was withheld. The payment must be accompanied by Form IRP 201. The tax withheld represents an advance payment of normal income tax on behalf of the employees concerned. Employers are also required to file annual employees' tax reconciliation Forms IRP 501 with SARS and to issue employees' tax certificates IRP 5 to all employees on an annual basis.

Top of Page

Regional Service Council levies

The Regional Service Councils (RSCs) are responsible for administering Regional Service Council levies. RSCs provide utilities and other services to metropolitan and other areas. They are funded by levies on the turnover generated and salaries and wages paid by businesses operating within their jurisdiction.

Registration
All operating companies are required to register with the RSC having jurisdiction in the area where they conduct business.

Reporting
RSCs are responsible for administering the levies and distributing the funds. The regional establishment levy currently ranges from 0,10 to 0,15% of turnover. The payroll levy currently ranges from 0,25 to 0,35% of payroll. Each RSC may set its own rates within these parameters.

Accounting policies

The Companies Act requires all public and private companies to maintain accounting records in one of the official languages of the Republic. Similar provisions exist for close corporations under the Close Corporations Act. The South African Institute of Chartered Accountants issues statements of generally accepted accounting practice (GAAP). These statements are in the process of being brought into line with the International Accounting Standards Committee. Companies and close corporations are required to follow statements of generally accepted accounting practice in preparing their final statements, and to achieve fair presentation, other entities should also follow these standards.

Certain companies, including public companies and foreign companies with branches in South Africa, are required to file their financial statements with the Registrar of Companies.

Directors should take cognisance of the Code of Corporate Practices and Conduct as published in the King Report. The Code is a set of principles for good corporate governance and deals specifically with the role of the director. Directors of companies listed on the main board of the Johannesburg Stock Exchange are required to report on their company's compliance with the Code, and similar disclosure by all other entities is encouraged.

Contact Information
South African Revenue Service (SARS)
Department of Finance
Private Bag X923
Pretoria
0001
Telephone: +27 (12) 422-4000

Top of Page

OTHER RELEVANT LAWS FOR BUSINESS

Competition law

In the second half of 1998 a new Competition Law was finalised. It provides for approval of mergers if strict criteria are used, such as whether the new firm created would be dominant in its market, the effect of a merger and whether any other reasons in favour of the merger exist, such as efficiency or competition in international markets. The new law aims to strike a balance between certainty and flexibility by providing clear rules. Measures taken against anti-competitive practices are now more severe than those that prevailed under the previous Competition Law.

Environmental law

Environmental legislation is receiving increasing attention in South Africa, with severe penalties under discussion in a proposed Environmental Bill for those found guilty of damaging the environment. The penalties could extend even to those who were directors of a company at the time the environmental damage was caused.

The main longstanding legislation affecting environmental issues are the Atmospheric Pollution Prevention Act, the Health Act and the Water Act. The Bill of Rights of the South African Constitution stipulates that everyone has the right to an environment that is not harmful to health or well-being.

Top of Page

Labour Laws: Labour Relations and Skills Development

Since the 1994 democratic elections, a number of new labour laws have been introduced in South Africa. These laws seek to:

  • Regulate the relationship between employers and employees;
  • Provide basic employment standards for employees;
  • Advance historically disadvantaged employees in the workplace; and,
  • Improve the skills of employees.

Labour Relations Act
The new Labour Relations Act (LRA) applies to all employees in South Africa, except members of the defence force and national intelligence agencies.

The LRA encourages and regulates collective bargaining between employers and trade unions.

Bargaining councils can be formed by agreement between registered trade unions and registered employers' organisations. A bargaining council's primary function is the conclusion of collective agreements between employers' organisations and trade unions.

Employees have the right to strike on matters of mutual interest, such as wages and conditions of work. They cannot strike on dismissals. The Act also sets down a process which needs to be followed before the right to strike can be exercised. These strikes are then regarded as procedural and workers who strike cannot be dismissed for striking. The LRA regulates unfair dismissal and sets up the Commission for Conciliation Mediation and Arbitration (CCMA) and the Labour Court as dispute resolution bodies. The CCMA handles the bulk of dispute resolution, as almost all disputes have to be mediated by the CCMA first. The Labour Court, on the other hand, has exclusive jurisdiction to deal with matters such as retrenchments, strike interdicts and review of CCMA decisions. Appeal against decisions of the Labour Court lies with the Labour Appeal Court.

Dismissal of employees

In South Africa an employee can be dismissed if there is a fair reason for the dismissal and a fair procedure is followed before the employee is dismissed.

Fair Reason:
A fair reason for dismissal includes:

  • Misconduct on the part of the employee;
  • The incapacity of the employee (unable to perform duties properly owing to illness, ill-health or inability.); and,
  • Operational reasons (retrenchment).

In all the above instances, the procedures contained in the LRA, as well as a company's own disciplinary procedures, must be followed before an employee is dismissed.

Retrenchment:
Before an employer can retrench employees, the employer must consult with the employees concerned or their trade unions on, amongst other things, the reasons for the dismissals, the number of employees to be affected, the proposed methods of selecting the employees to be retrenched and severance pay.

Severance Pay:
With regard to severance pay an employer must pay a retrenched employee a minimum of one week's wages for each year of completed service.

Disputes about dismissals:
Disputes over unfair dismissals must first be referred to the relevant bargaining council or the CCMA for conciliation. If conciliation fails, the dispute may be referred to arbitration or the Labour Court, depending on the type of dispute. The process of dispute resolution is speedy: disputes must be referred within thirty (30) days of them occurring and are usually also set down for conciliation within thirty (30) days.

Basic Conditions of Employment Act
The new Basic Conditions of Employment Act (BCEA), which came into operation in December 1998, extends the basic floor of rights of South African employees. These conditions are the minimum conditions and can be varied and improved upon by collective bargaining through plant or company level collective agreements or sectoral bargaining councils. They can also be varied through ministerial determination.

The BCEA places obligations on employers in respect of working hours, annual leave, leave pay, maternity leave, family responsibility leave and overtime pay for employees. The LRA also provides special protection to night workers and shift workers. It also prohibits child and forced labour.

Key Provisions of the Basic Conditions of Employment Act
Normal Time:
The maximum ordinary hours of work that an employee may work in any week or on any day are as follows:

  • 45 hours in any week;
  • Nine hours a day for employees who work on five or fewer days in a week; and,
  • Eight hours per day for employees working more than five days per week.

Any time worked in excess of these limits will be overtime. An employee's ordinary hours of work may, by agreement, be extended by up to 15 minutes a day to enable the employee to continue serving members of the public after the completion of ordinary hours of work. This is subject to a weekly limit of one hour.

Top of Page

Overtime:
An employee may not be required or permitted to work overtime unless there is an agreement between the employer and employee, either in an employment contract for compulsory overtime or an ad hoc agreement for voluntary overtime.

An employee who works overtime must be paid 1,5 times the employee's ordinary hourly wage (time and a half). An employee may, however, agree to take paid time off instead of being paid for overtime work. The paid time off must be granted to the employee within one (1) month of the employee becoming entitled to it.

Work on Sundays:
An employee may only work on a Sunday if there is an agreement to this effect. Such an agreement may be general or apply to a particular Sunday only. Employees who normally work on Sundays must be paid one-and-a-half times their normal hourly wage. If an employee does not normally work on a Sunday, the employee must be paid double his or her normal wage.

At a minimum, however, an employee who works on a Sunday must receive at least his or her ordinary daily wage. In other words, an employee who works for one or two hours on a Sunday must be paid at least his or her ordinary daily wage for that work.

An employer and employees may agree that the employee be granted paid time off rather than be paid for Sunday work.

Work on Public Holidays:
In the absence of an agreement, an employer may not require an employee to work on a public holiday. An agreement, or contract of employment, may provide that an employee will work on some or all public holidays. If there is no such agreement, the employer will have to secure the employee's agreement for work on any public holiday. Note: There are 13 South African public holidays.

Leave:
There are four categories of leave to which employees are entitled:

  • Annual leave;
  • Sick leave;
  • Maternity leave; and,
  • Family responsibility leave.

With the exception of employees who work for an employer for less than twenty-four (24) hours a month, all employees have the right to annual leave, sick leave and maternity leave. Family responsibility leave is only for employees who work for an employer on four or more days a week.

Annual Leave:
An employee is entitled to at least twenty-one (21) consecutive days' (three weeks') leave in respect of each year of employment.

As an employee is entitled to consecutive days; an employee can insist on a three-week period of unbroken leave each year.

Annual leave must be granted within six (6) months after the end of each annual leave cycle. The timing of leave should be agreed upon between the employer and employee. If no agreement can be reached, the employer is entitled to decide when leave must be taken. An employee may not take annual leave during any other period of paid leave in terms of the BCEA, such as sick leave, or during any period of notice of termination.

Top of Page

Sick Leave:
An employee's sick leave is calculated over a three-year sick leave cycle. During each cycle an employee is entitled to receive paid sick leave for the number of days that the employee normally works during a six-week period. For example, an employee who works five (5) days a week for an employer is entitled to thirty (30) days paid sick leave over the three-year cycle.

Maternity Leave:
Employees have the right to four (4) consecutive months' maternity leave. Maternity leave may be taken at any time from four (4) weeks before the expected date of birth of the child. An employee is not required to remain away from work for the full four-month period and may choose to return earlier. However, she may not work within six (6) weeks of the birth of her child unless a medical practitioner or midwife certifies that she is fit to do so.

An employee must give an employer at least four (4) weeks' notice before she starts her maternity leave of when she intends to take the maternity leave and return to work.

A pregnant or breastfeeding employee may not be required to perform work that is hazardous to the health of the employee or the child.

Family Responsibility Leave:
An employee is entitled to three (3) days' paid family responsibility leave during each annual leave cycle. Family responsibility leave may be taken:

  • When the employee's child is born;
  • When the employee's child is sick; and,
  • In the event of the death of a member of the employee's immediate family.

Family responsibility leave must be paid at the employee's ordinary wage and on the employee's usual pay day.

Age of Employment
The BCEA prohibits the employment of any child under fifteen (15) years of age.

In addition, a child between the ages of fifteen (15) and eighteen (18) may not be employed in employment:

  • That is inappropriate for the child; and,
  • That places at risk the child's well-being, education, physical or mental health or spiritual, moral or social development.

It is a criminal offence to employ a child in contravention of the BCEA.

Employment Equity Act
The Employment Equity Act prohibits discrimination at the workplace and promotes employment equity.
Employees who are discriminated against on a wide range of grounds, including race, gender and disability, are entitled to declare a dispute against their employer. Such disputes are conciliated and if not resolved can either be arbitrated or sent to the Labour Court for adjudication.

Employers who employ over 150 employees are obliged to report to the Department on an annual basis and are obliged to develop employment equity or affirmative action plans. Employers who employ between 50 and 150 employees are expected to report every second year. In the South African environment, the promotion of employment equity will enable enterprises to take maximum advantage of the opportunities offered by diversity.

Skills Development Act/Skills Development Levies Act
The Skills Development Act obliges all employers to look at the issue of training and education. All employers are obliged to contribute an amount equivalent to 1% of their payroll to assigned industry controlled Sectoral Education & Training Authority (SETA). Employers who submit a sensible training plan will be eligible to receive back a percentage of their contributions (65% in 2001, 60% in 2002).

A National Skills fund has been established and may, in some cases, be accessed to train local people to benefit from new employment opportunities linked to new investments.

In addition to the above legal requirements, foreign investors are also expected to import new technologies in order to raise the productive capacity of the South African economy. It is also suggested, although not a requirement, that investors meet with the relevant trade unions to discuss their interests and concerns during the start-up process.

Top of Page

RECOMMENDATIONS FOR INVESTORS

Though not required by law, it is strongly recommended that investors consult with the relevant industry union(s) during the start-up phase. Investors should consider that union interests reach far beyond the bread-and-butter issues of wages and benefits. Consultations should include discussion of:

  • The enterprise's human resource strategy, including plans for skills and technology transfer;
  • Plans to address affirmative action.
  • Possible stakeholding / profit-sharing agreements for employees; and,
  • The enterprise's market plans;
Furthermore, once in operation, unions also have the right to be consulted on such matters as:
  • Proposed restructuring of the workplace;
  • Planned mergers and acquisitions that would affect labour; and,
  • Proposed retrenchments.

Contact Information
Ministry of Labour
Postal address:
Private Bag X499
Pretoria 0001
Telephone: +27 (12) 309-4000
Facsimile: +27 (12) 309-4446

Labour Union Federations
Congress of South African Trade Unions (COSATU)
Telephone: +27 (11) 339-4911
Facsimile: +27 (11) 339-5080

Federation of Unions of South Africa (FEDUSA)
Telephone: +27 (11) 476-5188
Facsimile: +27 (11) 476-5131

National Council of Trade Unions (NACTU)
Telephone: +27 (11) 833-1040
Facsimile: +27 (11) 833-1032

Top of Page

National Investment Promotion Agencies
Trade and Investment South Africa
Mr Lungisa Magwentshu
Physical address:
1 Dr Lategan Road, Groenkloof, Pretoria 0027
Postal address:
PO Box 902 Pretoria, 0027
Telephone: 0861 843 384
Facsimile: +27 (12) 428-7898
Internet: http://www.thedti.gov.za
Email: isa@isa.org.za

GEDA - Gauteng Development Agency
Mr C Jonker
Physical address:
88 Fox Street, 4th Floor, Marshalltown, Jhb
Postal address:
PO Box 61840
Marshalltown
Johannesburg
2107
Telephone: +27 (11) 833-8750
Facsimile: +27 (11) 833-8777
Email: charles@geda.co.za

Mpumalanga
Mr M Skosana
Physical address:
MII house 1st Floor, No. 16 Streak Street, Nelspruit
Postal address:
PO Box 3881
Nelspruit
1200
Telephone: +27 (13) 752-5384
Facsimile: +27 (13) 752-5385
Email: musi@mii.co.za

Kwa Zulu Natal
Trade and Investment Kwa Zulu Natal
Dr IB Mkhize
Physical address:
3rd Floor The Marine, 22 Gardiner Street, Durban
Postal address:
PO Box 4245
Durban
4000
Telephone: +27 (31) 304-4303
Facsimile: +27 (31) 304-4471
Email: queen@tikzn.co.za

Eastern Cape
Eastern Cape Development Corporation
Physical address:
Ocean Terrace Park, West Street Quigney
Postal address:
PO Box 11197
Tecoma
5214
Telephone: +27 (43) 7432158
Facsimile: +27 (43) 743 2889 / +27 (43) 743 2299
Email: mjonas@ecdc.co.za

Western Cape
Wesgro
Mr R Hein
Physical address:
22nd Floor, No. 2 Long Street, Cape Town
Postal address:
PO Box 1678
Cape Town
8000
Telephone: +27 (21) 418-6464
Facsimile: +27 (21) 418-2323
Email: roland@wesgrow.org.za

Free State
Department of Trade and Industry
Ms L van Rensburg
Physical address:
60 Park Road, 1st Floor Tourist Centre, Bloemfontein
Postal address:
PO Box 6590
Bloemfontein
9300
Telephone: +27 (51) 403-3576
Facsimile: +27 (51) 403-3437
Email:vrensbl@dteea.fs.gov.za

Northern Cape
Department of Economic Affairs and Tourism
Ms R Moloi
Physical address:
13th Floor Post Office Building, Market Square, Kimberley
Postal address:
Private Bag X 6108
Kimberley
8300
Telephone: +27 (53) 839-4002
Facsimile: +27 (53) 831-3668
Email: rmoloi@met.ncape.gov.za

North West Province
Invest North West
Mr P Smith
Physical address:
171 Wolmarans Street, 1st Floor Old Mutual Building, Rustenburg
Postal address:
PO Box 6352
Rustenburg
0300
Telephone: +27 (14) 594-2570
Facsimile: +27 (14) 594-2575
Email: pietsmith@inw.org.za

Limpopo - Trade and Investment Limpopo
Mr J Mathibula
Physical address:
130 A Marshall Street, Polokwane
Postal address:
PO Box 3490
Polokwane
Telephone: +27 (15) 295-5171
Facsimile: +27 (15) 295-5197
Email:joe@npii.co.za