Companies that fail to comply with requirements to submit securities and beneficial ownership registers to the Companies & Intellectual Property Commission (CIPC) will face punitive penalties in the future if legislative proposals by the Treasury are enacted.
The proposals in the draft General Laws (Anti-money Laundering and Combating Terrorism Financing) Amendment Bill were released by the Treasury for public comment last week.
The bill aims to strengthen South Africa’s legislative framework to combat money laundering and the financing of terrorism ahead of a 2026/27 evaluation by the international watchdog that greylisted the country in 2023 over identified deficiencies.
Remaining deficiencies
The greylisting by the Financial Action Task Force (FATF) was lifted in October 2025, relieving the banking and business sector of onerous due diligence requirements.
The draft bill, an omnibus bill that seeks to amend several laws, tackles the remaining deficiencies identified by FATF.
Reporting to the CIPC of beneficial ownership — which identifies the ultimate individuals owning or controlling an asset or security such as a company or trust — became obligatory in May 2023 under the 2022 General Laws (Anti-Money Laundering and Combating Terrorism Financing) Act.
South Africa’s lack of a beneficial ownership reporting regime was a key deficiency identified by FATF.
Fines and deregistration
In terms of the draft bill, a company that fails to submit a securities register or register of beneficial interest for two years or more in succession could be fined as much as 10% of the company’s turnover for the period during which it failed to comply with the CIPC’s notice.
The CIPC will also be empowered to deregister a company that fails to submit a securities register within a certain period.
Another key provision of the draft bill is to empower the Financial Intelligence Centre (FIC), which monitors suspicious transactions by accountable and reporting institutions, to conduct lifestyle audits at the request of organs of state, public entities, municipalities and municipal entities.
Lifestyle audit
The aim would be to investigate possible money laundering. The FIC would be empowered to make the information derived from the lifestyle audit available to the entity concerned.
The FIC would also be empowered to request information from a public entity, municipality or municipal entity and to obtain access to their data.
Individuals providing information to the FIC will be protected under the Protection of Information Act.
Accountable institutions that are required to report to the FIC would also be required to take into account the risk of new delivery mechanisms and the use of new and developing technology that could involve or facilitate money laundering, the financing of terrorism and related activities.
Information sharing
The FIC will be authorised to share information with the Public Procurement Office and the Border Management Authority.
The draft bill tightens up the regulation of nonprofit organisations, regarded as a possible conduit for money laundering and the financing of terrorism.
Draft amendments to the Financial Sector Regulation Act seek to close gaps in customer protection, market conduct and anti-money-laundering regulation, while strengthening licensing and enforcement powers.
The deadline for public comment is the close of business on February 13.
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