The President of the Ghana Association of Restructuring and Insolvency Advisers, GARIA, Felix Addo, is urging young entrepreneurs to seek understanding of the new Companies Act to avert lawsuits that may distract their operations.
President Akufo-Addo assented to the New Companies Act, on August 2nd 2019.
The Companies Act, 2019 has been in the works since 2018 and replaces the Companies Act, 1963 (Act 179). At a very high level, the new Act seeks to introduce improved corporate governance standards for companies operating in Ghana.
The Act draws on the experience of more developed Jurisdiction and specifically incudes international best practices from jurisdictions such as the United Kingdom, New Zealand, South Africa and Mauritius.
The impact of the legislation will be felt most in corporate administration with the creation of the Office of Registrar of Companies, an autonomous governmental body similar to the United Kingdom’s Companies House.
The Registrar of Companies would operate separately from the Registrar Generals Department and will be solely responsible for the registration, regulation and winding up of corporate bodies in the country.
The new Act introduces reforms to company registration and regulation with the overall aim of simplifying the regulatory framework surrounding the incorporation and operation of companies while improving existing corporate governance standards that exist in the country.
Speaking to Citi Business News after GARIA organized a Master class; Mr. Addo warned that neglecting the new Act could be detrimental to businesses.
“We are going to be electronic in the new act, its going to allow for electronic filing of returns, communication , in all incorporating companies will be done electronically. There are still some implementation challenges we haven’t gotten there yet, so the new Companies Act previously before a company is announced, it has to be gazetted; but under the new law, the Register of Companies can just inform the world that a new company has been incorporated by what we call a companies bulletin and that is an excellent facilitation” he noted.