Company Act to boost business registration

A prospective business owner searches the Internet for on-line registration procedures. PHOTO BY FAISWAL KASIRYE 

By FARIDAH KULABAKO

In Summary

The operationalisation of the Company Act is still pending approval of the drafted regulations by the Ministry of Justice and Constitutional Affairs.

Kampala

Company registration will get easier as the operationalisation of the Company Act 2012 starts to take shape, an official has said.

Instead of filing the Memorandum and Articles of association and other documents of incorporation as provided for in the old Act - the Companies Act Cap 110 laws of Uganda 2000 - anyone intending to register companies will now be required to fill in a single form, thereby reducing on the bulkiness of documents.

Mr Robert Mugabe, a senior business registration officer at the Uganda Registration Services Bureau (URSB), said the operationalisation of the Act is still pending approval of the drafted regulations by the ministry of Justice and Constitutional Affairs.


“Our target was to have the Act enforced by the end of June but we have not yet got any response from the line ministry, however, we hope the regulations will be approved soon,” Mr Mugabe told a gathering of company secretaries from insurance firms in Kampala on Monday.

Uganda ranks poorly in the World Bank’s Doing Business Reports, standing at 120 out of 185 countries in 2013.

Uganda fell down from 119 in 2012 mainly due to the lengthy procedures to register a business. It takes 21 days in Uganda to register a business and there are 33 procedures one has to go through to have a business registered.

The Act is also expected to introduce corporate governance principles that should be adhered to by all companies including having functional boards of directors and qualified people as chief executive officers, managers and company secretaries. “We will no longer entertain board members who come and run companies to bankruptcy and then run to other companies. They will have to be accountable for the performance and affairs of the company,” Mr Mugabe said.

The Act also will introduce sole proprietorships centrally to previous demands of where the company would at least be require to have at least two shareholders.

Failure to adhere to the company registration rules will attract penalties. The Insurance Regulatory Authority (IRA) chief executive officer, Mr Ibrahim Kadunabbi Lubega, said if operationalised, the Act will improve the performance of insurance firms in Uganda with emphasis on employing competent people.

fkulabako@ug.nationmedia.com