| (1) |
For the purposes of this Act a company shall in respect of each year of assessment be recognized as either a public or a private company, and the Commissioner shall upon the request of any company inform that company whether it is recognized as a public company or as a private company. |
| (2) |
The following companies shall, subject to the provisions of section 39, be recognized as public companies, namely— |
| (a) |
any company all classes of whose equity shares are publicly quoted on the specified date by a stock exchange in the list issued under its authority, provided— |
[Section 38(2)(a) substituted by section 58(a) of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
| (i) |
that the stock exchange is a recognized and bona fide stock exchange under adequate control; |
| (ii) |
that the rules and regulations of the stock exchange for granting and continuing a quotation for the purchase and sale of shares provide for full protection of the interests of the public in regard to dealings in the shares of the company; |
| (iii) |
that the memorandum of incorporation prohibits such restrictions on the right to acquire or transfer any of its shares as are likely to preclude members of the general public from becoming shareholders in any class of the company's shares; and |
[Section 38(2)(a)(iii) substituted by section 59(1)(a) of the Taxation Laws Amendment Act, 2010 (Act No. 7 of 2010) - effective 1 January 2011]
| (iv) |
that the general public was throughout the year of assessment in question interested either directly as shareholders in the company or indirectly as shareholders in any other company, in more than forty per cent. of every class of equity shares issued by the company; |
[Section 38(2)(a)(iv) substituted by section 16(a) of the Income Tax Act, 1964 (Act No. 90 of 1964)]
| (i) |
the general public was throughout the year of assessment in question interested either directly as shareholders in the company or indirectly as shareholders in any other company, in more than fifty per cent of every class of equity shares issued by the company; and |
| (ii) |
the business of the company is conducted and its profits are distributed in such a manner that no person enjoys or receives or is entitled to enjoy or receive, by reason of shareholding, participation in the management or otherwise, any advantage which would not be enjoyed or received by him if the company had been under the control of a board of directors acting in the best interests of all its shareholders and had been one which could have been recognized as a public company under paragraph (a); |
[Section 38(2)(b) substituted by section 58(b) of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
| (c) |
any company which has been approved as a public benefit organisation in terms of the provisions of section 30(3). |
[Section 38(2)(c) substituted by section 43(1) of the Second Revenue Laws Amendment Act, 2001 (Act No. 60 of 2001)]
[Section 38(2)(d) substituted by section 30(1) of the Taxation Laws Amendment Act, 2007 (Act No. 8 of 2007)]
| (e) |
any insurance society or company subject to assessment in terms of section 28, 29 or 29A; |
[Section 38(2)(e) substituted by section 32(c) of the Revenue Laws Amendment Act, 199 (Act No. 53 of 1999)]
| (f) |
any public utility company, established by or under a special Act of Parliament; |
| (g) |
any company the sole or principal business of which in the Republic is mining for gold or diamonds; |
[Section 38(2)(g) substituted by section 21 of the Income Tax Act, 1962 (Act No. 90 of 1962)]
| (h) |
any company to which the provisions of section 33 apply; and |
[Section 38(2)(h) substituted by section 21 of the Income Tax Act, 1962 (Act No. 90 of 1962]
| (i) |
[Section 38(2)(i) deleted by section 45(a) of the Taxation Laws Amendment Act, 2009 (Act No. 17 of 2009)] |
| (3) |
A company which is not recognized as a public company shall be recognized as a private company. |
[Section 38(3) substituted by section 16(c) of the Income Tax Act, 1964 (Act No. 90 of 1964)]
| (4) |
For the purposes of this section— |
| (a) |
the general public in relation to any company (in this paragraph referred to as the company) shall be deemed not to include— |
| (ii) |
any relative of any director of the company, unless such relative, if he is not the spouse or minor child of such director, has at all relevant times exercised his rights as a shareholder in the company or in any other company through which such relative is interested in the shares of the company, independently of such director; or |
[Section 38(4)(a)(ii) substituted by section 58(c) of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
| (iv) |
any person to the extent that he acts in a fiduciary capacity, or as a nominee, for the benefit of any person who is not in fact or in terms of any other provision of this subsection a member of the general public in relation to the company; or |
| (v) |
any man or his wife or any minor child of any man or his wife, if one or more of such persons are directly or indirectly interested (otherwise than by virtue of any shareholding in any public company or any private company which is interested in the shares of the company through a direct or indirect interest in the equity shares in a public company) in altogether more than 15 per cent of any class of equity shares issued by the company; |
[Section 38(4)(a)(iv) substituted by section 59(1)(c) of the Taxation Laws Amendment Act, 2010 (Act No. 7 of 2010) - effective 1 January 2011]
| (b) |
the general public in relation to any company (in this paragraph referred to as the company) shall be deemed to include— |
[Section 38(4)(b)(i) substituted by section 58(d) of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
| (ii) |
any person to the extent that he acts in a fiduciary capacity, or as a nominee, for the benefit of any person who is in fact or in terms of any other provision of this subsection a member of the general public in relation to the company; |
(c) where any person—
| (i) |
being a public company, is indirectly interested in any shares of any other company; or |
| (ii) |
being a member of the general public in relation to any company. is indirectly interested in any shares of that company, |
by virtue of the said person being a shareholder in any private company and such interest is not attributable to a direct or indirect interest of such private company in the equity shares in a public company, the said person shall be deemed to be interested in only that portion of such shares as such person would be entitled to receive if every company through which that person is interested in those shares were to be wound up or liquidated and the assets of each such company were, without regard to its liabilities, to be distributed among its shareholders;
[Section 38(4)(c) substituted by section 58(e) of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
| (d) |
where persons are jointly interested, whether directly or indirectly, but otherwise than through a direct or indirect interest in the equity shares of a public company, in the shares of any company, each such person shall be deemed to be interested in only such proportion of those shares as he would be entitled to receive if the joint interest of all such persons in such shares were to be divided between such persons. |
[Section 38(4)(d) substituted by section 58(f) of the Taxation Laws Amendment Act, 2015 (Act No. 25 of 2015)]
[Section 38(4) inserted by section 16(d) of the Income Tax Act, 1964 (Act No. 90 of 1964)]
Gas Regulator Levies Act, 2002
