A foreign or external company is a company incorporated outside of South Africa, irrespective of whether it is a profit or non-profit company or carrying on business in South Africa. A foreign company is prohibited from offering securities to the South African public unless it follows the specific provisions of the Companies Act, 2008, relating to offers to the public.

A foreign company is required to register as an “external company” with the CIPC if it conducts or intends to conduct business in South Africa. Section 23 of the Companies Act, 2008, lists a series of activities which will be regarded as conducting business.

This list includes:

  • Holding a meeting or meetings of shareholders or board of the foreign company, or otherwise conducting the internal affairs of the company;
  • Establishing or maintaining any bank or other financial account;
  • Establishing or maintaining offices or agencies for the transfer, exchange or registration of the foreign company’s own securities;
  • Creating or acquiring any debts, mortgages, or security interests in any property;
  • Acquiring any interest in intellectual property; and
  • Entering into contracts of employment.

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