Business Administration in South Africa

Overview by Globlatrade.net:

Setting Up a Company

Legal Business Entities

Types of Companies and Capital (Max/Min) Number of Partners/Shareholders and Liability Registration Fees
Private Limited Company
 
 
No legal limit
Minimum number is 1; while as the maximum number is 50.
 
 
Liability limited to the amount contributed.
Registration fee of ZAR 350 plus ZAR 5 per ZAR 1,200 of nominal share capital (or part thereof).
Public Limited Company .
 
 
No legal limit
Minimum number is 7; while as there is no limit on the maximum number of members/shareholders.
 
 
The liability of a member is limited to the face value of the shares he owns
Registration fee of ZAR 350 plus ZAR 5 per ZAR 1,200 of nominal share capital (or part thereof).
Close Corporation
 
 
No minimum capital.
1 partner
 
 
Liability is limited to the amount contributed.
Registration fee of ZAR 350
Partnership
 
 
No minimum capital.
Minimum 2; Maximum 20 partners.
 
 
Liabiltity of the active partners is unlimited. Liability of the sleeping partner is limited to the amount contributed.
Registration fee of ZAR 350 plus ZAR 5 per ZAR 1,200 of nominal share capital (or part thereof).
 
Business Setup Procedures
Registration of an external company is effected by lodging the following documents with the Registrar of Companies within 21days after the establishment of a place of business:

 

1. a certified copy of the memorandum of association of the company,

2. a notice of the registered office and postal address of the company;

3. the consent of, and the name and address of, the auditor of the company in South Africa;

4. a notice of the name and address of the person resident in South Africa who is authorised by the company to accept, on the company's behalf, all service of processes and notices.

Thereafter, the Registrar will register the company, allocate a registration number to the company concerned and issue a certificate of registration to the company. Private companies do not have to lodge their annual financial statements with the Registrar. For details, refer to ‘Register a company

The Competent Organization
Companies and Intellectual Property Registration Office
Search a Company or a Financial Report
CIPRO, Companies and Intellectual Property Registration office

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Working Conditions

Legal Weekly Duration
45 hours in a week or 9 hours in a day. For employees who work a 6-day week, it is 8 hours per day.
Retirement Age
The retirement age is 65 for men and 60 for women.
Working Contracts
Employment is mainly regulated by the law of contract and by Labour Relations Act (LRA),1995. The contract should clearly mention : maximum hours of work, overtime rates, minimum periods of annual leave, notice of termination, organizational rights in respect of trade unions, strike law, rights and responsibilities of employers and workers in the event of retrenchments, insolvency and transfers of businesses, protection from unfair dismissal and the prohibition of unfair discrimination.

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Cost of Labor

Minimum Wage
South Africa does not have a national minimum wage, but the Minister of Labour can make sectoral determinations, which may include a basic remuneration level. Legislation differentiates between urban and rural areas.
Average Wage
Average monthly gross earnings in South Africa is ZAR 8,500 (USD 1,100).
Social contributions
Social Security Contributions Paid By Employers: 1 %.
Social Security Contributions Paid By Employees: 1 %.

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Social Partners

Social Dialogue and Involvement of Social Partners
For effective bargaining, South Africa has Bargaining Council system. Bargaining takes place between the employers and trade unions under the auspices of the Bargaining Council. The collective agreements concluded in the Bargaining Council bind only the parties to the Bargaining Council.

The Congress of South African Trade Unions (COSATU) is the largest and most effective trade union in South Africa. It is affiliated with the African National Congress (ANC) and the South African Communist Party. COSATU represents 21 national industrial affiliates.

Unions
COSATU (Congress of South African Trade Unions)
FEDUSA (Federation of Unions of South Africa)
Unionization Rate
30% (approximately)
Labor Regulation Bodies
Department of Labour, Government of South Africa

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