OVER 800 COMPANIES DEREGISTERED

MBABANE – Approximately 800 dormant companies have been deregistered from the registry of companies. 
A total 1 012 companies, whose names are known to the Business Desk but will not be revealed for ethical reasons, initially stood not only to be deregistered but dissolved as well. 

These entities, which were among the 54 000 locally registered companies, stood to face the chop for continuous failure to comply with Section 62 (2) of the Companies Act No 8 of 2009, by not submitting their annual returns to the registry of companies.

The hard line approach was adopted by the Registrar of Companies Msebe Malinga in exercise of powers conferred by the Companies’ Act.
The legislation stipulates that all companies should submit their annual returns and also pay company renewal fees which make them eligible to be issued with a trading licence.

Depending on the shares or nominal capital, the minimum amount of money that should be paid by companies as renewal fees starts from E470 (minimum) up to E1 670 (maximum).    

 
Submitted

Malinga said from the advertised over 1 000 companies which had not submitted their annual returns, only around 200 showed up to provide the necessary details.

“Only a quarter of the companies submitted their annual returns which led to the eventual deregistration of 800 companies,” said Malinga.     
Relating how they eventually uncovered that over 1 000 companies were violating the Companies Act by not submitting their annual returns, Malinga explained that between May and September 2018, they undertook an internal audit to determine the exact number of fully operational businesses in the kingdom.

He said it was during this audit that they unearthed that there were companies which had not submitted their annual returns for two or more consecutive years.
He said in line with the legislation, they invoked Section 62 which stipulates that if the registrar has reasonable cause to believe that a company was no longer doing business in the country, the registrar issues a notice for the company(s) to show cause why they should not be struck off from the registry of companies.

Wrong

All the companies which were found to be on the wrong side of the law had been expected to show cause within two months why they ought not be deregistered.
Further, Malinga mentioned that on the basis of the fact that their audit had lasted for about five months, there was a high possibility that there could be more companies which were in violation of the law.

When earlier asked how much company renewal fees were due as a result of the alleged non-compliance, Malinga disclosed that the average amount of money which should have been pumped into government coffers was over E8 million.
Malinga also stated that if a company was in default of the Companies Act in terms of renewal fees, the amount attracts 10 per cent interest on a monthly basis.

Quizzed as to what had been the feedback from businesses which do not comply with the Act, Malinga mentioned that some of the hurdles as stated by the directors were lack of awareness, shortage of sufficient business deals, lack of tax holidays and a comprehensive understanding of the country’s tax model.

Registered

It has also been recently reported that in only five months, the registry of companies registered a total of 1 377 businesses.
These figures, sourced from the registry department, reflected an overall increase of 269 businesses when compared to the same period (January to May) in 2018 where 1 108 companies managed to successfully be uploaded into the system. Independent calculations by the Business Desk based on the above figures translated to a 19.5 per cent overall increase. 

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: