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The South African government published the Business Licensing Bill, 2025 (the "Bill") on 26 September 2025. The Bill proposes a reform of the country's business licensing regime and aims to create a uniform licensing system that promotes economic unity, equal opportunity and social inclusion. The Bill will replace the Businesses Act, 1991 (the "Businesses Act"), which has been criticised for lacking clear guidelines, failing to regulate foreign-owned businesses and not reflecting co-operative governance principles.
Key features of the Bill:
Comprehensive framework
The Bill introduces a national framework for business licensing, setting out principles, procedures and minimum requirements for applying as well as issuing and enforcing licenses. It applies to all businesses – citizen- and foreign-owned – provided that non-citizens comply with immigration and refugee laws. It also seeks to harmonise provincial legislation and municipal by-laws for consistency across all spheres of government.
Designated business undertakings and exemptions
The Bill empowers the Minister responsible for small business development to designate certain business activities that require a license. Before designation, the Minister must follow a public consultation process. The Bill also allows exemptions for specific industries or businesses, such as low-risk businesses, non-profits and start-ups.
Application process
Applications must be made by the person in control of the business or an authorised representative, in the prescribed form and in compliance with applicable laws. Licenses are generally granted unless premises fail to meet planning, health or safety standards, or the applicant is deemed unsuitable due to criminal convictions, regulatory breaches or fraudulent conduct. Licenses are valid for up to five years and can be amended or extended.
Foreign nationals
Non-citizens must hold a valid visa or permit under the Immigration Act, 2002, or an asylum seeker or refugee visa under the Refugees Act, 1998, to qualify for a business license. Licenses remain valid only for the duration of the visa or permit.
Principles of licensing
The Bill is guided by three key principles:
- Redress: Licensing policies must correct past inequities by improving access to business infrastructure and ensuring inclusion of previously excluded communities – especially informal settlements, former homelands and areas affected by poverty.
- Efficiency: Licensing processes must be streamlined and cost-effective. Authorities should optimise resources, reduce compliance burdens and ensure that license fees cover administrative costs only, not serve as a revenue source.
- Good administration: Licensing authorities must apply fair and transparent processes that allow stakeholder input and clearly communicate all rules and procedures to the public.
Preferential measures for small enterprises
Licensing authorities may adopt measures to support small businesses, such as simplified application and renewal processes, reduced or waived fees and exclusive trading zones.
Enforcement, offences and penalties
The Bill gives authorised officers wide powers to monitor and enforce compliance. These include inspecting premises, requesting documents, investigating complaints, confiscating goods from unlicensed businesses, issuing compliance notices and imposing administrative fines of up to ZAR10 000. Offences include operating without a valid license, failing to produce a license on request, breaching license conditions, obstructing enforcement, providing false or misleading information and using fraudulent licenses. Convictions may result in fines and/or imprisonment.
Provinces and municipalities
Provinces must enact their own business licensing laws and may assist municipalities that fail to meet obligations. Municipalities must adopt by-laws aligned with national and provincial laws, enforce compliance, and may restrict or prohibit street trading in certain areas – subject to public consultation. All provincial and municipal licensing laws and by-laws must align with the three key principles mentioned above.
Transitional provisions
Applications submitted under the Businesses Act will be finalised under that Act. Existing licenses and compliance notices remain valid until they expire, after which renewals must comply with the new law. Fines and penalties issued under the Businesses Act also remain enforceable until fully discharged.
Public reaction
Following strong interest from stakeholders and numerous requests for additional time to prepare and submit inputs, the deadline for public comment on the Bill has been extended to 28 November 2025. Reaction to the Bill has been mixed: while some welcome its aim to create consistency, others are concerned that it will create uncertainty, increase administrative burdens and unintentionally impede growth and development.
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