By Anna Vayanos
As you will be aware, there has been a spate of new reporting and disclosure requirements affecting foundations and other non-profit organisations in South Africa. As a reminder, these are all part of South Africa’s initiatives to prevent money laundering and terrorism financing and our attempts to avoid, and now be removed from, our greylisting.
Some more regulations have been published and so compliance with some of these is necessary and in some instances, possible – which sounds odd but in reading further, should make sense.
Non profit organisation registration
Not all foundations or non-profit organisations are formally registered as Non Profit Organisations with the NPO Directorate. Up until now, registration has been voluntary, but soon, this will change and certain organisations and foundations, particularly those involved in funding or activities outside of South Africa, will need to formally register.
The date for this compulsory registration has not yet been announced but the regulations setting out the further information required to be submitted by those that are voluntarily registered, as well as those who will be compelled to register, have been published and are effective as of 8 May 2023.
It is a somewhat tricky situation in that in some instances, the requirement to comply is already in place but the manner in which one must comply is not yet clear.
Apparently, the NPO Directorate will be launching an awareness campaign which will hopefully clarify dates and means soon. In the meantime, boards and management should consider whether their organisation or foundation is a likely candidate for compulsory registration as an NPO. This would apply if the foundation or organisation:
- Makes donations to individuals or organisations outside of South Africa; or
- Provides humanitarian, charitable, religious, educational or cultural services outside of South Africa.
Foundations and organisations set up as trusts
For those foundations and organisations set up as trusts, just a reminder that the beneficial ownership register is available for completion.
The online register is in a Google Forms format (hopefully as an interim measure) and so there are concerns about the safety of the information lodged but since 1 April 2023, trustees are required to comply with the submission of this information.
For some more background and detail, you are welcome to refer to the article: New reporting requirements for trustees – effective 1 April 2023.
Foundations or organisations set up as Non Profit Companies (NPCs)
As of 24 May 2023, the requirement for companies (including NPCs) to disclose their beneficial ownership information with CIPC is now fully in place. Further information issued can be found in the Guidance Note issued by CIPC.
With the urgency with which some of these provisions and requirements are being introduced, the legislation seems to be way ahead of the means with which to comply, but hopefully this will all become clearer soon. It is good to be aware of what is coming up and to keep an eye out for any deadlines.
Source: This article was originally published on www.annavayanos.co.za in June 2023
Anna Vayanos Philanthropy Consulting
Specialist advisor to donors and NPOs