Zimbabwe Company Registration.
Zimbabwe company registration
The Republic of Zimbabwe is a landlocked country in Southern Africa and is bordered by South Africa, Zambia, and Mozambique.
Zimbabwe is presently very active in promoting the investment necessary for the rebuilding of its economy. The investment rules and regulations have presently remained largely unchanged since the Zimbabwe Dollar era but there has been a significant relaxation of exchange controls.
Zimbabwe company registration. Forms of business entities
The laws governing business entities in Zimbabwe have their origin in Roman-Dutch law, borrowing from English law As a result, Zimbabwe law contains much of English mercantile, company and insolvency law. In many cases, legislation has been strengthened by the persuasive authority of English and other judicial precedent.
The Principle business entities operating in Zimbabwe fall into five broad categories; namely:
- Sole proprietorship
- Partnerships
- Co-operatives
- Companies (public or private) incorporated under the Companies Act (Chapter 24:03)
- Foreign branches/representative offices or subsidiaries
Zimbabwe company registration. Company formation
A company is registered by filing a Memorandum of Association (Articles of Incorporation) and Articles of Association with the Registrar of Companies. Registration takes between one and two weeks if all documentation is in order and the prescribed fees are settled. The registrar may request additional information in respect of entities restricted by other laws or regulations.
Zimbabwe company registration. Capital and shares
No minimum capital requirements are contained in the Companies Act (however, as in the case of Banks for example, other legislation may govern this). The authorised share capital, details of which must be given in the Memorandum of Association, generally consists of ordinary shares (common stock) and/or preference shares (preferred stock). Ordinary shares are the most usual, which may be divided into various classes with varying rights to dividends and votes. Preference shares carry preferential rights to participation in the distribution of dividends or capital, or both. They may be issued with or without voting rights and may be cumulative with regard to unpaid dividends. There are no limits on the amount of authorised capital.
Issued share capital cannot exceed the authorised capital. The minimum number of issued shares is two. The signatories to the Memorandum and Articles of Association must specify the number of shares for which they undertake to subscribe, they must each subscribe for no less than one, and the minimum number of signatories to the memorandum and articles is two. Share capital that was denominated in Zimbabwe dollars is required to be legally reconstituted to United States Dollars by way of a special resolution. The Registrar of Companies has been restricting entities from reconstituting share capital in fraction of cents.
The rights of shareholders, as embodied in the Memorandum and Articles of Association can only be altered by special resolution as prescribed in the Companies Act. An annual general meeting of shareholders must be held each year, within six months of the financial year end and within fifteen months of the previous annual general meeting.
Zimbabwe company registration. Director and the public officer
The business of the company is managed by its directors who are appointed in the first instance by the subscribers to the Memorandum and Articles of Association and, thereafter by the shareholders at the annual general meeting. The powers of the company are vested in its directors as a board and are exercised at board meetings in accordance with procedures laid down in its Articles.
Companies are required to have at least one resident director. The Income Tax Act also requires that every company which carries on trade has an office or has established a place of business in Zimbabwe, is obliged by the Zimbabwean law to appoint a public officer who is a Zimbabwean resident, within one month from the establishment of the business in Zimbabwe. The public officer is responsible for statutory requirements. Everything done by any public officer which he is required to do in his representative capacity shall be deemed to have been done by the company which he represents.
Zimbabwe company registration. Tax registration
Income tax
After a company has been incorporated, it must register with the Zimbabwe Revenue Authority (ZIMRA) within thirty days of incorporation.
The registration process takes approximately two days. Every company which carries on trade or has an office in Zimbabwe is obliged to appoint a representative who is the public officer of the company within one month of the establishment of such office or place of business. The public officer has to be approved by the commissioner General and is answerable for all company tax matters. Companies are also obliged, within one month of establishing a business, to nominate a place within Zimbabwe at which any notices or other documents under the Income Tax Act affecting the company may be served or delivered.
Value Added Tax
Every entity which carries on a taxable activity and whose annual taxable turnover exceeds or is likely to exceed US$60 000 per annum is obliged to register as an operator not later than thirty days after becoming so liable. Non-resident persons are required to appoint a representative registered operator in Zimbabwe and furnish the Commissioner with the particulars of such representative registered operator.
All registered operators are required to open a banking account with a bank, building society or other similar institution for the purposes of his trade carried on in Zimbabwe and furnish the Commissioner with the particulars of such banking account.
Zimbabwe company registration. Business licenses and permits
The Shop Licenses Act stipulates that a license should be held by any person who carries on a trade or business of selling goods or of letting goods for hire. The license is issued by a local licensing authority (City/Municipality).
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