GOVERNMENT is expected to rake in millions of dollars following the enactment of a law that requires all registered companies in Zimbabwe to re-register by March next year.
All existing companies which were registered before February 22, 2020 are required to re-register with the Registrar of Companies in line with the new Companies and Other Business Act [Chapter 24:31].
The new Act which came into effect in the first quarter of 2020, gave companies up to March 2021 to complete the re-registration process or risk being struck off the register.
Companies will fork out US$5 for name search and a CR21 form and US$150 for Memorandum and Articles of Association. Zimbabwe has tens of thousands of registered companies whose exact number could not be established because the department is not computerised.
Finance and Economic Development, deputy minister Clemence Chiduwa confirmed the development, but referred further questions to the Justice and Legal Parliamentary Affairs, and Industry and Commerce ministries.
“Yes, I can confirm that the new Companies Act requires all companies to re-register, but I cannot comment on that because the registration of companies falls under the Ministry of Justice and Legal Parliamentary Affairs and their operations fall under the Ministry of Industry and Commerce. So those are the rightful ministries to comment on that matter,” Chiduwa said.
Both Justice minister Ziyambi Ziyambi and his Industry and Commerce counterpart Sekai Nzenza were not reachable for comment yesterday.
The new Act seeks to curb shortcomings of the manual registration process by introducing electronic registration.
The re-registration exercise is said to be an administrative process aimed at establishing a new and updated register of companies.
Although the e-government initiative is aimed at achieving quicker, simpler and more transparent turnaround in the registration process aimed primarily at improving the ease of doing business in Zimbabwe, the process has led to serious congestion as companies rush to beat the deadline and maintain a smooth flow of operations.
The chaotic situation was recently exacerbated by shortage of special paper used in printing certificates of incorporation.
One businessman who spoke on condition of anonymity said although the new Act sought to promote computerisation of the Registrar of Companies a lot needed to be done.
“I have frequented this office for more than two months now trying to register my new company, but the chaos here is pathetic. To worsen the matter I was told that they have ran out of paper to print certificates of incorporation. That shows poor planning. How is it that they start a new thing without adequate resources?” he asked.
“To be frank, the Act will require commitment for it to become effective as it is already evident that the implementing office is struggling with the new requirements just a few weeks since its inception. The companies office must, therefore, be adequately capacitated to meet the requirements of the new law and new players seeking company registration,” he said.
The new Act repeals the old Companies Act, which had been in force since April 1, 1952 and incorporates provisions of the Private Business Corporations which seek to encourage small-to-medium enterprises to register and be recognised as players in the economy.
The previous Act is said to have over the years been overtaken by constitutional, technological, economic and other developments that have taken place in Zimbabwe.
The new Act empowers the Registrar of Companies to strike off defunct business entities. It also stipulates that shelf or shell companies that do not file returns on the anniversary of their incorporation shall be removed from the register.