How To Do Business In South Africa

South Africa: open for business

South Africa is one of the most sophisticated, diverse and promising emerging markets globally.

Strategically located at the tip of the African continent, South Africa is a key investment location, both for the market opportunities that lie within its borders and for the opportunity that exists to use the country as a gateway to the rest of the continent, a market of nearly 1-billion people.

South Africa has enormous potential as an investment destination, offering a unique combination of  highly developed first-world economic infrastructure with a vibrant emerging    market economy.

It is also one of the most advanced, broad-based industrial and productive economies in Africa.

Here are just some of the reasons for doing business in South Africa:

(Source: website & Department of Trade & Industry:

Ease of doing business in SA

South Africa is among the top 30 countries in the world for ease of doing business, according to a 2010 World Bank report. The finding suggests that South Africa is making progress in creating an environment conducive to investment, which the government has identified as key to achieving a 6% growth rate.

The survey ranked 155 countries according to the number of procedures, time and costs involved in: starting a business; dealing with licenses; hiring and firing workers; registering property; getting credit; protection for investors; paying taxes; trading across borders; enforcing contracts; and closing a business.

South Africa ranked 28th, ahead of Spain (ranked at 30), Austria (32), France (44), Russia (79),    China (91) and Brazil (119). Overall, SA had the highest ease-of-business ranking on the African continent.

Starting a business

Foreign companies wishing to establish a local branch in South Africa must register the branch as an external company with the Registrar of Companies within 21 days of establishing an office. The most common business entities in South Africa are: Private companies Pty (Ltd); Public companies (Ltd); Close corporations. Private companies are commonly used by foreign investors owing to the minimal annual formalities required.

The directors need not be SA residents or nationals. Public companies are formed to raise funds by offering shares to the public and there is no limit to the number of shareholders. At least seven (7) shareholders are required to form a public company.