BUSINESS INSIGHTS: Companies cannot own members’ interest in close corporations

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Discover the process and benefits of converting a Close Corporation (CC) to a (Pty) Ltd company, from legal to financial advantages.

Discover the process and benefits of converting a Close Corporation to a Ltd company, from legal to financial advantages.

Because the costs and ease of operating a CC are now the same as for a company , there is no material benefit to continuing to use a CC. ii. the potential personal liability of directors versus shareholders. If there is more than one member in a close corporation, I would recommend considering converting to a company.In either case, we can assist with amending a CC’s association agreement, a company’s memorandum of incorporation and a shareholders agreement to record the required balance of powers between the members in the CC, or the shareholders and the directors in the company.

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