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Thread: How Do I Get A Bank Account With New Pty Ltd?

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    Email problem derekjay's Avatar
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    Question How Do I Get A Bank Account With New Pty Ltd?

    I've just registered a new Pty Ltd (since CCs are now done with). I have received the CoR 14.3 (notice of registration), so the company is now formed. Upon taking this to the bank, they requested in addition to this, the "Memorandum of Incorporation 15.1A & B.

    I've got the forms from CIPC's website - do I just fill them in and sign them? Is there any sort of certification required by a "higher power" (magistrate, comm of oaths,etc).

    Feeling confused

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    Site Caretaker Dave A's Avatar
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    *bump*

    Anyone?
    The trouble with opportunity is it normally comes dressed up as work.

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    Silver Member geraldenek's Avatar
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    Did you only submit one copy of the company documents? You should always submit two as one gets stamped and sent back to you. If you haven't received/done so, please contact them in order to send a copy to you.

    As for the bank just ask them nicely and say the MOI takes forever to send if they can't open the bank account without this - worked for me .
    Geraldene Kapp
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    www.mytaxhelp.co.za

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    Yes, you just fill them in again and give that to the bank.

    Lately, both Standard and FNB also want the 14.1 (Notice Of Incorporation). The fact that the notice is actually the incorporators instruction to CIPC and has nothing to do with the bank, does not faze them a bit. Same story, just fill in and sign another one.

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    Email problem BusNavig8's Avatar
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    Another issue we have come accross with the banks is that of Share certificates. Obviously if you register yourself you will not be in possession of these either. I've noticed that the online companies issue certificates from publisher templates.

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    There is a steep learning curve if you register a new company (for the first time and all on you own). If you don't have the patience or the experience, I would recommend you use the services of a reputable registration company to smooth the process. One of the pit falls is the fact that CIPC does not record the shareholders information, crazy I know but this causes much frustration as the banks request copies of the share certificates in order to open a new bank account with credit facilities.

    The following is the checklist required by the banks for a Private Company
    CoR 14.3 Company Registration Certificate
    CoR 14.1 Notice of Incorporation
    CoR 15.1A Memorandum of Incorporation
    Shareholders Certificates

    I hope this helps

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    Quote Originally Posted by SwiftReg View Post
    One of the pit falls is the fact that CIPC does not record the shareholders information, crazy I know but this causes much frustration as the banks request copies of the share certificates in order to open a new bank account with credit facilities.

    I hope this helps
    It's actually not CIPC's fault. You cannot record shareholders in a company still to be formed, and anyway the shareholders are investors and are not charged with any management functions and it is one of life's mysteries why on earth banks want copies of the certificates.

    Secondly, if there are, lets say five shareholders, and you only present two share certificates, how would they know? Or one shareholder lives in Cape Town and the company is based in Johannesburg; how would you present his share certificate?

    When a public company opens a bank account, they wouldn't dream of requiring the share certificates. There is nothing in the act affecting the bank that makes a private company any different.

    As usual, the banks have lost the plot.

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    Email problem BusNavig8's Avatar
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    Quote Originally Posted by CLIVE-TRIANGLE View Post
    It's actually not CIPC's fault. You cannot record shareholders in a company still to be formed, and anyway the shareholders are investors and are not charged with any management functions and it is one of life's mysteries why on earth banks want copies of the certificates.

    Secondly, if there are, lets say five shareholders, and you only present two share certificates, how would they know? Or one shareholder lives in Cape Town and the company is based in Johannesburg; how would you present his share certificate?

    When a public company opens a bank account, they wouldn't dream of requiring the share certificates. There is nothing in the act affecting the bank that makes a private company any different.

    As usual, the banks have lost the plot.
    Im not so sure that I agree with you on this one. First of all, one of the reasons the Act was introduced was to make the process simple and accessible. The DTI has a duty to the man in the street to be able to register the company and be able to open a bank account, register with SARS and he has 40 business days to appoint an Accounting officer/Auditor. It is nothing as part of the incorporation documentation to produce a further document, a share certificate of the shareholders. They are Incorporating the company, they have assumed the responsibility of the would be attorneys/auditors etc in this regard. Further if you own shares, you are issued with a share certificate. I agree the banks have lost the plot in insisting on them, but CIPC can issue them as part of the Incorporating documentation. It will solve the whole problem and they have taken on this responsibility, they cannot stop halfway.

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    Not really so.
    You need to understand the Act in it's entirety.
    CIPC is a regulatory body. Share matters are not regulated. Share transactions are private matters between shareholders and between shareholders and the company. The directors must maintain a register of shareholders to which only shareholders have access. Further;
    1.) The incorporators are just that, the incorporators. Once the initial director(s) are appointed they have no further role in the company. I incorporate companies all the time and once the company is sold I have no further role in it.
    2.) Directors are charged with ALL fiduciary matters, including issuing of unissued shares. Neither the incorporators nor shareholders are empowered to do that. If the company did not appoint an initial director when it was incorporated, it has 40 business days in which to do so.
    3.) Shareholders are investors and have two significant rights; the right to a dividend and the right to vote in accordance with the rights afforded by the particular share class they have invested in. They have no right to manage.

    Not only is it a simple matter for the directors to issue the share certificates, the Act allows only them to do so. The issuing of shares is not a regulated transaction and requires no notification to CIPC. They are issued in terms of it's MOI. The internet abounds with templates to enable anybody to do just this. The only proviso is that the shares issued must be reflected in the register and so too any transfers made.

    There is no difference between inherent rights and obligations of the officers of private and public companies. Clearly it would be absurd for banks to want to inspect the share certificates of shareholders of a public company. They are asking to see the share certificates of private companies simply because they can. It serves no practical reason; what possible use or comfort could they derive from it?

    Actually they are "seeing" nothing. If I issues share certificates 1 to 20, and show them only 1, or 1 to 4, how would they be any the wiser? Inspecting the share register might make some sense, but only for today, because tomorrow John sells his two shares to Joe, so what was the point.

    Banks are trying to turn private companies into cc's.

    The new act is very different from the old act. The old act had the "original subscribers to the memorandum", who were not only the incorporators and the initial shareholders, but also the default directors.

    If when opening the account, the company is applying simultaneously for credit facilities, and the bank wants shareholders to provide sureties, then it makes sense. That is the only circumstance I can think of.

    To my mind, where CIPC (and banks for that matter) are messing up is that CIPC do not return a registered version of the MOI adopted. You simply print another one and sign it. You may well be printing one that is entirely different to the one registered. Fine, in the event of a dispute, the one registered is the one that holds sway. Custom MOI's may well have elaborate payment authorisation procedures built in, and signing mandates arranged at the bank may conflict with it, and nobody will be any the wiser. Similarly, there may be restrictions on borrowing powers.

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    Quote Originally Posted by CLIVE-TRIANGLE View Post
    Not really so.
    You need to understand the Act in it's entirety.
    CIPC is a regulatory body. Share matters are not regulated. Share transactions are private matters between shareholders and between shareholders and the company. The directors must maintain a register of shareholders to which only shareholders have access.
    That was not my point. My point was that the DTI has a duty towards the SME who does not have sufficient business acumen, knowledge or training to assist them in the furtherance of their business. The move whereby the ordinary citizen could incorporate a company did just that. The DTI has not extended this duty past this point to the explanation of what the duties of a director is and in this case the issue of share certificates. It is a small thing for them to issue the certificates initially as part of the incorporation in an effort to assist the SME with these matters and since it would be logical for the CIPC to be involved in this step. There are petitions and lobbies and organizations formed that are aimed solely at enforcing the duties of Govt towards SME's. If you took to a sample and asked the very same questions to people who ran small businesses on the role and duties of being a director I guarantee you you will not get the response that you have put forward - why because people don't know what they are in for.

    For me it's not about understanding the Act it's about understanding the problem

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