Selling your business to a foreign buyer: price, payment and paperwork

Who counts as a foreign buyer

For exchange control, a non-resident is a person or company whose normal place of residence, domicile or registration is outside the Common Monetary Area (CMA): South Africa, Lesotho, Namibia and eSwatini. A buyer who lives permanently in London or Dubai, or a company registered there, is a non-resident; one who lives in Namibia is not. A South African working abroad for a while may still count as a resident, so confirm the buyer's status with your bank.

Some buyers that look foreign are South Africans investing back through an offshore company, which the SARB calls a loop structure and which carries its own reporting duties, so ask early who ultimately owns the buyer. Every buyer abroad also works at a distance, so they lean harder on documents and on your handover.

A few sectors limit foreign ownership or need a regulator's consent to a change of control. A foreigner may not control a commercial broadcasting licensee or hold more than 20% of it (Electronic Communications Act, section 64), and a controlling interest in a company holding a prospecting or mining right may not change hands without the Minister's written consent, unless the company is listed (Mineral and Petroleum Resources Development Act, section 11). Your attorney checks this before you sign.

What a buyer abroad will ask for

Everything a local buyer asks for, in more detail and earlier. Have it ready before marketing starts:

Expect questions about a handover period, a restraint of trade and who will run the business. If the buyer means to move here and run it, ask how their business visa affects the timetable, and give any condition that depends on it a long-stop date.

Share sale or business sale: what changes for you

The buyer can buy your shares, or your company can sell the business itself as a going concern:

A buyer's South African company that is not yet a VAT vendor must apply before the agreement is concluded, and then be registered. Foreign directors without a South African ID are verified by CIPC against a certified passport copy before they can be appointed. The detail is in selling a business as a going concern.

How the money reaches you

Exchange control is run by the SARB's Financial Surveillance Department (FinSurv) through banks it appoints as Authorised Dealers, including the large South African banks. Its manual says non-residents "may freely invest in South Africa" if the deal is at arm's length, at a fair, market-related price, and financed in an approved manner: foreign currency brought in, or rand (ZAR) from the buyer's non-resident rand account or a foreign bank's rand account with a South African bank.

Secure the price first

Transfer nothing until the money is secure: the price paid into the trust account of the attorney handling the deal and released when the conditions are met, or the balance secured by a South African bank guarantee payable on a set event. A South African bank's guarantee for a buyer abroad counts as financial assistance to a non-resident, so the manual requires it to be backed by rand cash or assets in South Africa of at least the same value.

The fair-price test is yours

Because exchange controls on non-residents have been abolished, the manual says "the onus is on the South African buyer or seller of securities to prove that the transaction was concluded on an arm's length basis and at a fair and market related price". Banks look for evidence, such as an auditor's certificate for unlisted shares, and refer doubtful cases to FinSurv. A documented valuation answers the question early: see how to value a business in South Africa.

In a share sale, make sure the bank records the money coming in and the share certificate is endorsed "non-resident". That is the buyer's paper trail for taking the proceeds of a later sale out of South Africa, which the manual treats as freely transferable, so a careful buyer will ask for it at closing.

Ask your bank first

• Payment abroad. The manual takes a serious view of residents keeping foreign currency abroad without authority. If a buyer offers to pay part of the price offshore, stop and ask.
• Payment later. Regulation 3(1)(e) and (f) restrict credit, guarantees and other financial assistance to non-residents, and to South African companies 75% or more owned or controlled by them, unless an exemption applies; the manual gives those exemptions to banks. If part of the price is deferred, depends on future profits or is lent to the buyer or its South African company, ask whether approval is needed (SARB manual).
• Your loan account. If the buyer takes over your loan to the company, the company will owe a non-resident. The manual requires FinSurv's prior written approval to create a loan account between a resident and a non-resident, though banks can approve some loans from abroad themselves, so ask which applies.

Expect your bank and attorney to check where the money comes from: the manual's permissions do not displace anti-money-laundering law. Draft Capital Flow Management Regulations, published on 17 April 2026, are intended to replace the 1961 regulations; on 5 October 2026 they were still a draft, so the current rules apply until they are final. The buyer's side is in exchange control for foreign investors.

Your tax: a foreign buyer does not change it

South African residents pay capital gains tax (CGT) on disposals anywhere in the world, worked out the same way whoever buys. SARS’s 2026 guide gives the effective rate as up to 18% of the gain for an individual, 21.6% for a company and 36% for a trust. Under the Eighth Schedule to the Income Tax Act as it stands, an individual aged 55 or over who sells a small business (assets worth no more than R10 million) may exclude up to R1.8 million of gain over a lifetime. A draft Bill published with the February 2026 Budget would raise these to R2.7 million and R15 million from 1 March 2026, and SARS’s web page already shows the higher figures, but Parliament was still holding hearings on the Bill on 30 September 2026. Check which figures apply with your tax adviser when you sell; the other tests are in selling a business as a going concern.

• No withholding, as a rule. Section 35A of the Income Tax Act makes a buyer withhold tax only when a non-resident sells South African immovable property, including shares in a company whose value comes mainly from South African land, for more than R2 million (SARS: section 35A). If you are no longer tax resident in South Africa, ask your tax adviser whether it applies to you.
• Securities transfer tax of 0.25% on shares is the buyer's liability, as transferee (SARS: securities transfer tax).

How the price is split between goodwill, equipment and stock, and whether you sell shares or the business, can leave you with very different amounts from the same price. Model both with your tax adviser.

Does the deal need Competition Commission approval?

A sale is a merger under the Competition Act when the buyer acquires control, and only intermediate and large mergers must be notified. From 1 May 2026 a merger is intermediate when two tests are both met. First, the combined figure for both sides reaches R1 billion: their turnover in, into or from South Africa, their assets in South Africa, or one side's turnover plus the other's assets. Second, your business's own turnover or assets reach R200 million. A large merger needs R9.5 billion and R280 million (GN 7458, Government Gazette 54640).

Turnover "into" South Africa includes the buyer group's sales into the country from abroad; its sales elsewhere do not count. If your business's turnover and assets are both under R200 million, the deal is a small merger. A small merger generally needs no notification, but the Commission's guidelines ask to be told in writing before implementation about some small mergers: where a party or its group is under a Commission investigation or facing a case the Commission has referred to the Competition Tribunal, and where a very large acquirer, whose own turnover or assets exceed the large-merger combined threshold, pays a price above the large-merger threshold for the business being sold. The Commission may also call for a notification up to six months after implementation (small merger guidelines) if the merger may substantially prevent or lessen competition or cannot be justified on public interest grounds; once notified, the parties may take no further steps until it is approved. Your attorney confirms where your deal falls.

Keeping the sale confidential across borders

A foreign competitor may be the most interested party of all. Choose the governing law and courts in the non-disclosure agreement, then release information in stages: anonymous marketing first; the agreement signed before the information pack (in a private sale, before the name); proof of funds, such as a letter from the buyer's bank, before the books; customer lists, pricing and margins last.

Personal information going abroad

Section 72 of POPIA lets personal information go to someone in a foreign country only on set grounds, among them that the recipient is bound by a law or binding agreement giving protection substantially similar to POPIA's, or that the people concerned consent. Share staff data by role and customers without names until late, and have your attorney put POPIA-standard terms in the data room agreement. Keep special personal information, such as staff race, health, union membership or criminal records (employment equity and B-BBEE files often show race), out of anything sent abroad unless your attorney confirms it is allowed: under section 57, sending it to a country without adequate protection needs the Information Regulator's prior authorisation. More in the confidential business sale process.

How Dynamic sells a business, to buyers wherever they are

Dynamic Business Sales is the Dynamic Auctioneers division that sells trading businesses as going concerns. The businesses we sell are South African; the buyers can be anywhere.

• A confidential first call, then an appraisal of the financials, the lease, the asset register and the staff complement, telling you what a buyer is likely to pay and why. What selling costs, and who pays it, is set out in writing before you sign.
• A signed mandate, settling who is entitled to sell before any buyer is approached.
• Qualified buyers only, here and abroad alike: the non-disclosure agreement before the information pack, proof of funds before the books.
• Auction with a reserve, or private treaty. We recommend one and explain why; the choice is yours. Our auctions take bids online, and the sign-up for our online auction room takes a passport number from buyers who are not South African citizens, with a country selector and international dialling codes, so a buyer abroad can open an account from home. Like every bidder, they then complete FICA verification (identity checks named after South Africa's Financial Intelligence Centre Act) before bidding opens.

In September 2026 we auctioned the CMVAS Group, a connectivity, ICT distribution, technical services and critical power business, as separate businesses and as a whole through a sale of all its shares, with bidding on site in Centurion, online and by live webcast. We have also presented Isandlwana Lodge in Zululand, a South African lodge business, with offers invited in pounds sterling.

See the businesses for sale, how we sell businesses and our page for international buyers, or start a confidential enquiry. This guide is general information, not advice on your deal: take that from a South African attorney, a tax adviser and your bank.