An Overview

Commercial law is the legal practice area of South African law that applies to the rights, relations and conduct of individuals and or entities engaged in commerce, merchandising, trade and sales. It covers how businesses are set up, what they do, how they operate and how their rights are protected.

Commercial law is also known as mercantile law. It is sometimes loosely equated with corporate or company law, but the two are not the same thing. Company law deals with the creation, governance and dissolution of juristic entities and is one branch of commercial law. Commercial law is the wider field, taking in the law of contract, sale, agency, credit, insolvency, competition, consumer protection and much else besides, and it applies to sole proprietors and partnerships just as it does to companies.

Commercial Law in South African Businesses

South Africa has an advanced and strong commercial law environment governing the conduct of business in South Africa. The world of business can leave you exposed to unforeseen losses. The drafting of the necessary contracts and legal documents and acquiring legal advice can prevent the occurrence of unforeseeable risks or losses and forms part and parcel of the primary function of commercial law.

Key Legislation Governing Commercial Law in South Africa

Several pieces of legislation form the backbone of South African commercial law:

  • The Companies Act 71 of 2008: This is the principal statute governing the formation, operation, and dissolution of companies in South Africa. The Companies Amendment Acts of 2024 came only partially into effect on 27 December 2024, introducing changes including revised rules for financial assistance to subsidiaries, new share buy-back requirements, streamlined memorandum of incorporation amendments, and enhanced social and ethics committee reporting obligations. For more on company structures, see our article on understanding the corporate veil in South Africa’s Companies Act 71.
  • The Consumer Protection Act 68 of 2008: This Act protects consumers in their dealings with businesses, covering matters such as fair and honest dealing, product safety, and the right to fair value. Read more in our overview of the Consumer Protection Act in South Africa.
  • The Protection of Personal Information Act 4 of 2013 (POPIA): Businesses that process personal information must comply with POPIA’s conditions for lawful processing. See our article on the POPI Act in South Africa.
  • The Competition Act 89 of 1998: This Act prohibits anti-competitive practices, regulates mergers, and protects the interests of consumers and small businesses.

Recent Developments Businesses Should Be Aware Of

Remuneration transparency under the Companies Act

The most significant recent change is the commencement, on 22 May 2026, of sections 30A and 30B of the Companies Act, inserted by the Companies Amendment Act 16 of 2024. These sections apply to public and state-owned companies and introduce a statutory remuneration framework.

An in-scope company must prepare a forward-looking remuneration policy and put it to shareholders for approval by ordinary resolution at the annual general meeting, and must table it again every three years or sooner if there is a material change. It must also present an annual remuneration report at the AGM for shareholder approval. The remuneration report must disclose the ratio between the total remuneration of the top five per cent and the bottom five per cent of the company’s earners. Where a policy or report is not approved, prescribed consequences follow for the non-executive directors serving on the remuneration committee, who may be required to stand down from the committee and stand for re-election to the board.

The Companies and Intellectual Property Commission has published guidance on sections 30A and 30B. Affected companies should be treating this as a governance and disclosure exercise well before their next AGM, not as a year-end reporting item.

The POPIA Regulations

It is worth being precise about what changed here, because the position is often overstated. POPIA itself has not been amended. What changed is the POPIA Regulations, which were amended with effect from 17 April 2025.

Those amendments widened the channels through which a data subject may object to processing or request correction or deletion, so that a request may be made by means such as email, SMS, WhatsApp, telephone or in person, and free of charge. They also broadened who may lodge a complaint with the Information Regulator, streamlined the complaints process, tightened the consent requirements for direct marketing, and dealt with rules of procedure and administrative fines.

Data breach notification was not among the changes. That obligation sits in section 22 of POPIA itself and has been in force since 1 July 2021. Where there are reasonable grounds to believe that personal information has been accessed or acquired by an unauthorised person, the responsible party must notify the Information Regulator and the affected data subject, and the duty applies regardless of the size of the breach.

Starting and Operating a Business

Commercial law plays a central role from the moment a business is conceived. From choosing the correct legal structure to drafting contracts, protecting intellectual property, and ensuring regulatory compliance, legal guidance is essential at every stage. For entrepreneurs, our article on the legal requirements for starting a business in South Africa provides a practical starting point.

If you require assistance with any commercial law matter, contact us today for expert legal advice tailored to your business needs.

Updated 8 September 2026 — Corrected the statement that “the 2025 amendments” to POPIA strengthened data breach reporting and expanded data subject rights. POPIA itself was not amended; the POPIA Regulations were, with effect from 17 April 2025, and breach notification is unchanged and remains governed by section 22 of the Act, in force since 1 July 2021. What the amended Regulations actually changed is now set out. Added the commencement on 22 May 2026 of sections 30A and 30B of the Companies Act, which require public and state-owned companies to obtain shareholder approval of a remuneration policy and annual remuneration report and to disclose the pay ratio between their top and bottom five per cent of earners. Clarified that company law is a branch of commercial law rather than a synonym for it.