Private Company ((Pty) Limited) and Close Corporation

Private Company ((Pty) Limited) and Close Corporation
Private Company ((Pty) Limited) and Close Corporation

Private Company ((Pty) Limited) Comparison To Close Corporation

Below we provide a snapshot of the differences between a Pty Ltd and a Close Corporation. Whilst Close Corporations are no longer available as new business entities it is still worth consideration in the event that:

  • A shelf close corporation is available for purchase; or
  • A business entity is being bought which is a close corporation.

Often business people still have to decide between a Private Company ((Pty) Limited) and Close Corporation. It is important to understand the differences between a Private Company ((Pty) Limited) and Close Corporation and the table below provides some information in this regard.

Please note that we strongly advise you to seek professional assistance before making your decision. Our business experts look forward to assisting you in this regard. Simply contact us using the link below.

Private Company Close Corporation
Juristic Person Juristic Person
Enjoys Perpetual Succession Enjoys Perpetual Succession
No maximum shareholding Can Have A Maximum Of 10 Members
Companies Can Be Shareholders Companies Cannot Hold A Member’s Interest
Comprised Of Directors And Shareholders Comprised Of Members
Has A Memorandum of Incorporation Has A Founding Statement
May have a shareholders agreement Articles Of Association Are Not Required
Compulsory Annual Return To Be Lodged No Annual Return To Be Lodged
Has Share Capital Has Member’s Contributions
Has An Auditor in certain circumstances Has An Accounting Officer
Convenes An Annual General Meeting Annual General Meeting Not Required
Certificate Of Incorporation Certificate Of Incorporation
Shareholders Hold Shares Members Hold Member’s Interest
Can Acquire Its Own Shares Under Certain Circumstances Can Purchase A Member’s Interest
Directors Are Responsible For The Day To Day Management Of The Company Members Are Responsible For The Day To Day Management Of The CC
Register Of Shareholders No Register Of Members
Limited Liability Limited Liability
Audited Financial Statements in certain cases No Financial Statements needed
Prohibition On A Company To Provide Financial Assistance For The Acquisition Of Its Own Shares No Prohibition On A CC To Provide Financial Assistance For The Acquisition Of A Member’s Interest

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