CIPC Notice on Deregistered Entities Continuing to Trade

Posted 01 September 2025 Written by Acts Online
Category CIPC

Brought to you by SA Accounting Academy: The CIPC has clarified the legal consequences for companies operating while deregistered and mandated the use of automated reinstatement processes.

In terms of section 82(3) of the Companies Act, No. 71 of 2008, read together with regulation 40 of the Companies Regulations, 2011, the Companies and Intellectual Property Commission (CIPC) has issued Customer Notice 36 of 2025 regarding complaints lodged against entities operating while under ‘Deregistration’ or ‘Final Annual Return (AR) Deregistration’.

Once a company is placed under deregistration status for failing to file annual returns or via a voluntary application, it loses its juristic personality and ceases to exist as a legal entity. The CIPC highlights the following legal consequences of this status:

  • The company loses the capacity to litigate or be litigated against in any court of law.
  • The directors and shareholders of the entity may be held personally liable for any liabilities or obligations incurred during the period of deregistration.
  • Any person entering into business with a deregistered entity risks financial loss as contracts may be unenforceable due to the lack of legal personality.

Section 82(4) of the Companies Act, No. 71 of 2008, and regulation 40(6) permit the reinstatement of a deregistered company if it can be proven that the entity was in business or held immovable property at the time of deregistration. Reinstatement is further conditional upon the filing of all outstanding annual returns. Additionally, affected parties may apply for a court order to reinstate a company under section 83(4) of the Act.

Automation of Reinstatement Processes

As of 11 August 2025, the CIPC has introduced the automation of the Application for Re-instatement of Deregistered Company (Form CoR40.5). Consequently, all applications to reinstate a company or close corporation must be submitted electronically via the CIPC e-Services, BizPortal, or Self-Service Terminal platforms. The previously utilized dedicated email address for reinstatement applications is no longer operational, and all such applications must now be processed through the automated system.

Click here to download Customer Notice 36 of 2025: Deregistration Complaints.

What this means for you, your business, or your clients

  • For yourself: You must verify the registration status of any corporate entity via the CIPC BizPortal before entering into professional service agreements to ensure the entity has the legal capacity to contract and to avoid personal liability risks.
  • For your business: Review internal procurement and vendor management policies to include mandatory CIPC status verification; transacting with a deregistered entity may result in non-recoverable debts and legal inability to enforce contract terms.
  • For your clients: Advise clients that failure to file annual returns results in the immediate loss of the corporate veil, and guide them to use the new automated Form CoR40.5 system for reinstatements to restore legal personality and limit director liability.

Originally published at https://accountingacademy.co.za/news/read/cipc-complaints-re-businesses-operating-at-deregistration

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