26.1 PRIVATE COMPANY STARTUPS
There is a guideline that deals with the exemption of shelf companies in certain circumstances that says the following;
The Panel hereby publishes a Guideline that:
2.1 Notwithstanding that a percentage exceeding 10% of the issued securities is being disposed of by the incorporator and is transferred to the user in an initial transaction, the Panel does not regard such initial transaction as categorizing such private company, for purposes of that initial transaction alone, as a regulated company in terms of section 118.1 of the Act, on the basis that no shares had been transferred within the period of 24 months immediately before the date of such initial transaction. Accordingly, the Panel will not insist on compliance with the Takeover Regulations in respect of the initial transactions taking into consideration the purpose and objects of the Takeover Regulations.
2.2 However, thereafter for at least 24 months following such initial transaction such private company will, in terms of section 118.1(c) (i) of the Act, be categorized as a regulated company.
2.3 The Panel recognises that in the initial start-up phase of a private company the burden of compliance with Part B, Part C and the Takeover Regulations may, in many instances be unduly harsh on a private company. Accordingly, the Executive Director may, against submission of an application setting out all relevant facts, in terms of Section 119.6, exempt parties to an affected transaction from the application of Part B, Part C and the Takeover Regulations if he considers an exemption to be 3 reasonable and justifiable in the circumstances having regard to the objects and purposes of Part B, Part C and the Takeover Regulations.