Tinashe Makichi Business Reporter
Foreign-owned companies operating in reserved sectors of the economy are at risk of losing their licences if they fail to comply with the Indiginisation and Economic Empowerment Act.
Youth, Indigenisation and Economic Empowerment Minister Patrick Zhuwao yesterday told journalists after officially opening the Line Ministries Seminar that Government will not hesitate to turn down licence renewal applications for companies that are not compliant with the Indigenisation laws of the country.
Licences within the reserved sectors are renewed annually.
“The Indigenisation and Economic Empowerment Act requires all businesses to comply with minimum threshold of 51 percent but for the time being, we will allow them to operate only if they recognise the indigenisation law. We will not allow any new businesses to invest in the reserved sector.
“President Robert Mugabe as he closed the 15th National Annual Conference indicated that Government would not accept any company that ignores the Indigenisation and Economic Empowerment Act,” said Minister Zhuwao.
“Whenever a licence is due for renewal, we expect licensing authorities within that particular reserved sector to first ensure that the entity is compliant with Indigenisation and Economic Empowerment laws,” said Minister Zhuwao.
In bid to provide clarity to Indigenisation, Government pronounced a new framework, and guidelines for the law.
The frameworks and guidelines were developed to give added impetus towards compliance with the Indiginisation and Economic Empowerment legislation.
The guidelines, frameworks and procedures were developed in a manner designed to contribute to the achievement of the Zimbabwe Agenda for Sustainable Socio-Economic Transformation and the 10-Point Plan.
The new framework clarifies Government position on resources sectors, non-resources sectors and reserved sectors. Clarification of the law has been an important aspect in promoting investment, both domestic and foreign.