Key changes brought by the Companies Amendment Act 2022-By Mr Deo Kalikumutima Managing Partner of Kalikumutima and Co. Advocates
Are you a business owner or thinking of starting one? There is an ever-evolving business environment for directors and company members that must be tamed by a legal regime. The Companies Amendment Act 2022 objective is to amongst others close operational gaps that exist in the corporate sector as a whole.
The Companies Amendment Act 2022 structures, disentangles and shortens procedures for the incorporation of companies. The Parliament of Uganda enacted the Companies Amendment Act 2022 which was assented to by the President of the Republic of Uganda on 7th September 2022.
The Companies Amendment Act 2022 introduces requirements for private companies that don’t comply with any code of corporate governance to comply with Table F relating to corporate governance, a company limited by guarantee to re-register, the establishment of beneficial owners registers, and the registrar to cancel the registration of companies that are no longer in business.
Key changes brought by the Companies Amendment Act 2022 are as follows:
- Company registration
According to the Companies (Amendment) Act 2022, registration of a company can be done without filing a memorandum of Association. You only need to fill out Company form 1. In case you have a memorandum and articles of association, you may as well lodge them for registration.
As regards re-registration of companies, a company limited by guarantee can be re-registered as a company limited by shares upon passing a special resolution to be re-registered as such.
- Filing of returns by foreign companies.
Any Foreign company registered in Uganda that changes its charter, memorandum, articles of association, directors, secretary or name will have to file a return within 30 days from the date of making the changes.
- Cancelling of registration.
Any company that wants to stop operations will apply to the registrar to cancel its registration.
- Beneficial owners register.
A company is mandated to keep a register of its beneficial owners which should have all their particulars. The Act defines a beneficial owner to mean a person (s) having final ownership or control of the company.
- Cessation of business by Foreign companies.
Before a foreign company stops conducting business in Uganda, it will first publish a 30 days’ notice of cessation of business in a newspaper of wide circulation. The Act defines a foreign company as a company incorporated outside Uganda and later registered to conduct business in Uganda.
- No more issuing of share warrants.
Companies are no longer mandated to issue share warrants to any person.
In summation, the Companies Amendment Act 2022 brought several key changes but the major ones were on corporate governance to ensure more transparency and efficiency in the corporate sector.
