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Zvamaida Murwira Senior Reporter
Government will soon be empowered to strike off defunct companies from the register before their names are published in newspapers or Government Gazette if the current law before Parliament sails through. The Companies and Other Entities Bill, which is in its Second Reading, empowers the Registrar of Companies to remove defunct firms from the register if the companies fail to submit returns.

Presenting its report, the Parliamentary Portfolio Committee on Justice, Legal and Parliamentary Affairs led by Mutasa South legislator Cde Misheck Mataranyika (Zanu-PF) commended the provision.

Clause 52 of the Bill empowers the Registrar of Companies to strike off from the register defunct companies where it is apparent that they have ceased to operate by reason of not rendering returns.

“In terms of these provisions and any other similarly worded provisions, it is prudent for the notice for verification of incorporation and registration status and vesting of defunct business to also be published in the local newspaper in which the property is situated as this also ensures that the notice is properly circulated,” said Cde Mataranyika.

“Possibly to include an electronic means in circulating that notice in the interest of the owners as some might not always have access to the Government Gazette.”

Cde Mataranyika said the Committee had noted that the Bill was driven by a modernisation agenda, which seeks to maintain order in the corporate sector and ride on corporate governance principles that have developed in the last 40 years.
The Bill also provides that any member of the company that would have been struck off the register could apply to the magistrates’ court within whose area of jurisdiction the entity had its principal place of business for an order that the entity’s name be restored to the register.

The Companies and Other Business Entities Bill seeks to replace and update the law relating to companies and private business corporations. The present Companies Act was passed in 1951 and required updating.

Clause 228 of the Bill stipulates that every foreign company wanting to establish a place of business in Zimbabwe must lodge with the Minister of Justice a copy of its constitutive documents, a list of directors resident or to be resident in Zimbabwe and, if it is a subsidiary, the name of its holding company.

The Minister is involved because of the concerns over security in connection with money-laundering and terrorism within the framework of the country’s obligations to the Financial Action Taskforce.