Setting Up a Business in South Africa

Many international brand names have branches or subsidiaries in South Africa. If your company is looking to do to same, you should be aware of all the considerations to take into account when it comes to setting up a business in South Africa. Starting off with the wrong or incomplete information could spell difficulties down the road.

Setting up the business

The first step in setting up a business in South Africa as a foreign company is to decide on a company structure. Factors that could influence the decision-making process are:

  • The ownership structure.setting up a business south africa
  • The legal structure.
  • Setup requirements.
  • Taxation.
  • Ongoing legal requirements, like audits.
  • Foreign exchange.

Taking all of this into consideration, a business can be set up as a branch of an offshore company, also known as an external company, or a foreign-owned South African company, also known as a full subsidiary.

If the choice falls on an external company, the branch is registered within the jurisdiction of South Africa. This will lead to a South African registration number, but the shareholding and directors are still situated in the country of origin.

Should the choice fall on a full subsidiary structure for the business instead, then the company will operate in the form of a South African private company. Shares will be issued by the company and taken up by the international company.

Intergate Immigration can help you decide which of these structures are most appropriate for your company. Further to that, we can also assist in the following ways to make setting up a business in South Africa a more pleasant experience:

  • Act as local representatives in the interim.
  • Set up the branch or local private company.
  • Source an auditor.
  • Set up a postal address.
  • Set up an administration network.

Setting up a staff complement

It is common for foreign companies setting up in South Africa to have a need for relocating some of their staff to the South African branch or subsidiary. In order to do so, foreign employees will require a work visa. The intra-company transfer work visa is the most logical choice and thus used most often. Our corporate team can tell you more about this and all other work visas for South Africa, should you wish to employ more foreign workers.

Unique considerations when setting up a business in South Africa

There are two issues which need to be considered when setting up your business. The first of the two relates directly to the type of business structure you choose – profit. You have to ask yourself what you are going to do with the profit that the business operations will produce.

Secondly is the matter of BBEEE or Broad-Based Black Economic Empowerment. All businesses in South Africa must adhere to the regulations of this code of practices. In a nutshell, BBEEE is in place to advice economic transformation and to enhance the economic participation of black people in the South African economy.

Let us help your business get off the ground in South Africa

Call Intergate today to speak to the only immigration company in South Africa with ISO 9001 certification. You can call our Cape Town office on +27 (0) 21 424 2460, while our Johannesburg team can be reached at +27 (0)11 234 4275. Our client managers have helped hundreds of foreigners with setting up a business in South Africa, so we are in the perfect position to help.

The alternative is to get us to contact you by requesting a free call back. The minute we receive your request, one of our corporate client managers will endeavour to call you within 24 hours to discuss the needs of you and your business.