Forms of Business

Enterprise
Enter Forms of Business Enterprise – Introduction
Welcome to the Forms of Business Enterprise e-learning course.

This course will serve to acquaint you with the different forms
of business enterprise and will focus on the functioning of
companies.

Please be sure to pay careful attention as you will be assessed on this

content at the end of this course.

We hope you enjoy your training!

Click on each of the people above to get acquainted.
 Hi. My name is Jeff. I’ve recently been
retrenched due to my company downsizing and
because it’s so difficult to find work, I’ve
decided to start my own business. I want to buy
and sell stationary.

But… I’m rather clueless as to how to get

started…

Jeff
Hallo there. My name is Sylvia. I’m an attorney
specialising in Commercial Law. I’ll be with
you throughout your training to guide and assist
you where needed.

Hope you enjoy the course!

Sylvia
 Good day. My name is Cecile. I’m an attorney also specialising

VERY IMPORTANT: X
in Commercial Law. Sylvia has asked me to talk to be available
to answer any questions you might have and to provide
additional information
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it means that there is a sound
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I look forward to working with you!
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click on this icon to see the written transcript on the
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Cecile
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Good day. My name is Cecile. I’m an attorney also specialising
in Commercial Law. Sylvia has asked me to talk to be available
to answer any questions you might have and to provide
additional information where needed.

I look forward to working with you!

Cecile
 Good day. My name is Cecile. I’m an attorney also specialising

Sound File 1 X
in Commercial Law. Sylvia has asked me to talk to be available
to answer any questions you might have and to provide
additional
Good day. My name is Cecile.information where needed.

I am an attorney specializing in Commercial Law.

I look forward to working with you!
I have also been involved as instructor to candidate attorneys for the
past 18 years.

I will be available to answer your questions and to provide additional

Cecile
information, where needed.

I look forward to working with you!

So what exactly is the first step
when you are starting up a new
business?
The first thing you need to do is
to decide what legal form your
enterprise should take on.
This decision will be based on
considerations concerning the
attributes of each entrepreneurial
form as well as its advantages and
drawbacks as determined by statute
and common law.
Important concepts such as:
• legal personality,
• maintenance of capital,
• the rights and duties of the partners, the
directors,
• the shareholders and the members of a
close corporation, and
• the doctrine of disclosure and other
common law rules
all have legal implications of which the
prospective entrepreneur and his or her advisers
must take due notice.
Persons who are already in business and
find that their business entities are no
longer appropriate are faced with a
similar decision.

There are a variety of business entities to

choose from and each one has different
legal and tax implications.
Which business entities are most
commonly used in South Africa?
The business entities which are
used most frequently in South
Africa are the sole
proprietorships (sole traders),
partnerships, companies and
close corporations.
 The different forms of business
entities are discussed in more detail
in module 2. A professional adviser
must be fully acquainted with the
characteristics, advantages and
disadvantages of each business
enterprise, as well as the tax
implications, before being in a
position to take instructions
regarding the formation thereof.
 The different forms of business
entities are discussed in more detail
in module 2. A professional adviser
NOTE: X
must be fully acquainted with the
Insofar as reference ischaracteristics, advantages
made to the Companies Act, and
this refers to the Companies Act (Act 71of
disadvantages 2008)
each(“the
business
Companies Act”), unless otherwise indicated.
enterprise, as well as the tax
implications, before being in a
position to take instructions
regarding the formation thereof.
Please return to your course page to proceed with
Module 1.