THE COMPANIES AND OTHER BUSINESS ENTITIES ACT (CHAPTER 24:31) Key Provisions 2020
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THE COMPANIES AND OTHER BUSINESS ENTITIES ACT (CHAPTER 24:31)
Key Provisions
2020
W. Mushayi Deputy Controller ZIPO
Background
World Bank sponsored draft Bill 2016 Fell short of the acceptable threshold
Stakeholders demanded a fresh attempt
Attorney General’s first draft 2017
Stakeholder meetings
Peer review
First publication 2018
Public hearings
COBE 2019 Regulations 2020
W. Mushayi Deputy Controller ZIPO
Big Enough
W. Mushayi Deputy Controller ZIPO
COBE
To provide for the constitution, incorporation, registration, management and general internal administration of companies and private business corporations.
Voluntary registration of business entities
Voluntary winding up and removal of defunct companies and PBCs from the register
Confirmation of registration
Repeal of the Companies Act (Chapter 24:03) and the Private Business Corporations Act (Chapter 24:11)
What’s New
The Companies Office
Assumed Names
Replacement of lost, defaced or destroyed document
Inspections and Investigations
Disclosure of Beneficial ownership of shares
Mergers and Takeovers
Civil Penalties
Electronic Registry
Reregistration
W. Mushayi Deputy Controller ZIPO
The Companies Office
The Registrar of Companies and the Patents Office was set up in 1894 by the colonial regime under the British South Africa Company (BSAC) through a Cape Colony ordinance and administered together with the Deeds registry.
The bundling together of the three offices, deeds, companies and intellectual property was a matter of administrative convenience and a vestige of colonial legacy
Provisions relating to electronic communication
licensed business entity incorporation agent or licensed business entity service provider may apply, using form CR 1 to use an electronic email address, website, portal or other interactive electronic link for effecting notices, filings or other transactions with the Companies Office.
Structure of the Regulations Part I Preliminary
Part II General matters
Part III Private Companies
Part IV Public Companies
Part V Cooperative company
Part VI Company limited by guarantee
Part VII Foreign Company
Part VIII Private Business Corporation
Part IX Voluntary Registrations
Part X Transitional provisions
and portfolio of forms
Making COBE usable
Name Search application
Application on Form CR 3
Same form to cover all entities including PBCs and Assumed Names
Regulations will provide for dispute settlement in the event of conflict of names and against use of certain names
Objections to a name
If any person objects to the registered name of a registered business entity or to a name reserved pending registration of a registrable entity on the grounds that it is in conflict with section 25 of the Act, he or she may give notice, in writing , to the Chief Registrar of his or her objection to the name specifying the grounds of the objection is based
Elaborate due process for a hearing
Assumed Name
A person seeking to register an assumed name of a registered entity under section 29 of the Act which is additional to the name under which the registered business entity is registered an application to ascertain availability must be done.
Before using an assumed name an entity must notify the Registrar of its intention to use such name
Replacement of lost documents
Where a document required to be filed by a registered business entity has been lost, defaced or destroyed or where the Registrar cannot locate the file copy of a document, the registered business entity may apply to the Registrar for leave to file a copy of the document in accordance with section 16 of the Act.
Private Limited Company 76, 77
A person seeking to form a private company shall ascertain whether a name is available for registration
Stating objects of a company is optional for Private Limited company.
However it is still mandatory for company limited by guarantee
Submit together with list of directors and office address including email.
Public Limited companies
A person seeking to form a public company shall ascertain whether a name is available for registration
The applicant must within 30 days of receiving CV4 submit duplicate copies of registered office address, list of directors and secretary, consent to be a director, affidavit by directors, a copy of prospectus or a statement in lieu of a prospectus and duplicate copies of the Memorandum and Articles of Association of the public company
Company Limited by guarantee
A person seeking to form a company limited by guarantee applies through the Chief Registrar of Companies (CRC)
Chief Registrar recommends to the Minister for a license to dispense with “Limited” in its title.
Where the Minister so agrees, he or she issues an approval letter,
The Chief Registrar shall notify the applicant to advertise at his or her own expense such approval in the gazette not later than the second week of being so notified by the Registrar.
Company Limited by guarantee
Any person may object to the Licensing within 14 days
Such objections if they are valid will be considered at a hearing
If there are no objections, CRC will recommend to the Minister for a License to be issued
Following which CRC incorporates the company limited by guarantee
What’s new
Application for a license by the Minister has been streamlined
Streamlined advertisement in the gazette from three to one and reduced objection period
Annual declaration of existence and consistence of original objects.
Withdrawal of license by Minister
Public Companies
Functions and qualification of company secretary (198)
Declaration as to holding of the Annual general meeting
Shell and Shelf Companies
Can be discounted if registered in batches and applicant declares as such in a prescribed form.
Otherwise they attracts premium fees
Have a lifespan of 12 months unless annual return is submitted.
May be removed from the register without any further notifications.
Beneficial Ownership of shares 72
Accurate and up to date register of beneficial ownership of shares kept by the company itself.
To file with the Registrar accurate and up to date beneficial ownership information.
Threshold for disclosure 20% issued shares
Declaration form filed by the company secretary
Business entity incorporation agents and business entity service
providers 292
Legal practitioner, Chartered accountant, Public Accountants and Auditors and Chartered secretary.
Any other prescribed qualifications
Re-registration 303
A company or private business corporation must re-register under its existing name, without prejudice to its right after re-registration to change its name under section 26.
Object of Re-registration
to establish a new and updated register of companies and private business corporations;
to expunge apparently defunct business entities from the register
Re-registration is not Re-registration
It does Not;
Create a new legal entity
Affect or prejudice the identity of the body corporate
Affect the property, rights and obligations of the entity
Affect legal or other proceedings by or against the entity
Bona Vacantia 53
Where a company or private business corporation is dissolved, whether as a result of being wound up or as a result of being struck off the register as defunct, any undistributed property of the company or corporation shall, subject to this section, become bona vacantia and shall vest in the State.
Operation of section 53
Application for a bona vacantia order Publication of notice Process can only be challenged through
a court application to restore entity to the register in terms of section 52 (3) ©
Bona vacantia order has the same effect as a writ of execution
Civil penalties 294
Where default is made in complying with any provision of this Act or of regulations made under this Act for which a civil penalty is specified to be leviable, the Registrar may, in addition to, and without derogating from, any criminal or non-criminal penalty that may be imposed by this Act, or any other law for the conduct constituting the default, serve upon the defaulter a civil penalty order of the appropriate category
Inspections by Registrar
To ensure compliance with the Act
To promote good corporate governance
To inspire confidence to investors, in the said entity
Types of Investigations
Where the Registrar has reasonable cause to believe that compliance with the Act is lacking
On request of minority stakeholders
To determine ownership and control
Registrar’s Report
Copy to the Minister
Concerned entity
Shareholders
Registrar of the High Court
Publication
Electronic Registry
The Registrar may establish an electronic registry,
To digitize all records,
Establish and maintain an ICT system
The Registrar shall, for the purpose of regulating the use of the electronic registry by registered users, enter into a user agreement with each registered user.
Assumed Names CR3
No. of Entity………
REGISTRATION OF ASSUMED BUSINESS NAMES
True Name of Entity……………………………………..
Assumed Name of Entity………………………………..
To the Registrar of Companies ………………………………
The above-named entity hereby gives you notice in accordance with section 29(2) of the Companies and other business entities Act [Chapter 24:31], that the entity intends to conduct business in Zimbabwe under the assumed name:
Signed………………
Director/ Secretary This………day of ………………..20……
Presented by……………………………….
APPLICATION FOR REPLACEMENT OF LOST, DEFACED OR DESTROYED DOCUMENTS
The Secretary makes an oath that
The original documents has or have been lost, defaced or destroyed
That the copy of the document(s) attached is a correct copy
That an advertisement advising the public of the application for replacement of document(s) has been published in the government gazette or local circulating paper
BENEFICIAL OWNERSHIP DECLARATION FORM
Disclose particulars of nominee shareholders
Declaration as to the threshold of shares
Commitment to update whenever changes take place.
Shell and Shelf companies
Declaration by agent that documents presented relate to the listed shell companies or shelf companies
that the registration of the said companies shall expire on the anniversary of the incorporation
that the Registrar may remove them from the Register without further formalities.
DECLARATION OF CONTINUANCE OF INCORPORATION OF COMPANY
LIMITED BY GUARANTEE
Declaration that the company continues to exist for the lawful purpose
That it exists in the interest of the public or a section of the public
That it applies its profits, if any, or other income to promoting its objects, and prohibits the payment of any dividend to its members.
Declaration That Annual Meeting Of A PBC
Where PBC has more that one members.
Declaration that the mentioned corporation continues to exist for the lawful purposes
That an Annual Meeting has been held in terms of section 268 of the Act.
Application for Voluntary Registration
Full name of Partnership/ Joint Venture/ Association/ Syndicate/Consortium
Details of authorized representative
Accompanied by original constitutive documents
Power of attorney authorizing the representative
DECLARATION THAT AN ENTITY IS STILL IN EXISTENCE
Details of Partnership/ Joint Venture/ Association/ Syndicate/Consortium
Declaration that entity continues to exist for the lawful purposes stated in its constitutive documents.
FormsFORM TITLE
CR1 Applications for authority to use an electronic mail address, website, portal or other interactive electronic link.
CR2 Application for search as to availability of name
CR3 Notice of Registration of Assumed Names
CR4 Application for Replacement of lost, defaced and destroyed documents
CR5 Notice of situation and postal address of a company’s registered office registered principal place of business and of any change thereto.
CR6 List of Directors and Secretaries
CR7 Notice of change of entity name
CR8 Special resolution
CR9 Notice of conversion, consolidation and split of Share Capital
CR10 Notice of increase of share capital
FormsCR11 Return of Allotments
CR12 Notice of place where register of mortgages and debentures is kept or any change thereof
CR13 Notice of the situation of the office where branch register of members /debenture holders is kept or of discontinuance thereof.
CR14 Statement by directors for strike off or voluntary winding up
CR15 Conversion of a Private Limited Company to a PBC
CR16 Beneficial Ownership declaration Form
CR17 Declaration that the Annual General Meeting was held
CR18 Declaration of Shell and Shelf Companies
CR19 Affidavit in terms of section 158 of the Act
CR20 Consent to act as Director of a Public Company
FormsCR21 List of persons to act as directors
CR22 Statement by Company of the amount or rate paid agreed to paid by way of commission in respect of shares
CR23 Statutory Report
CR24 Declaration for continuance of incorporation of a company limited by guarantee
CR25 List of documents delivered for registration by a foreign company
CR26 Annual Return of a Foreign Company
CR27 Return of Alteration in the Charter, Constitution e.tc of a foreign Company
CR28 Incorporation Statement of a Private Business Corporation
CR29 Declaration that Annual Meeting was held
CR30 Amended Incorporation statement
CR31 Application for Conversion of a Private Business Corporation to a Company
CR32 Voluntary Registration of Partnerships and Agreements
CR33 Declaration that an entity is still in existence
CR34 Amendments or changes to constitutive documents
CR35 Application to inspect entity documents and Registers
Thank You
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