Has it registered that your company needs a register?
Take your average limited liability company incorporated in Ghana: the typical minimum of two directors and at least one shareholder requirement has been met; your auditor is in place along with your ever-faithful Company Secretary. You ensure you register your company with the Registrar General’s Department, Ghana Revenue Authority, Ghana Investment Promotion Centre (if applicable) and obtain other licenses and permits from the relevant authorities. Before you know it, you are already exhausted from trying to be compliant with all the requirements even before you start business, let alone make your first Ghana Cedi.
You eventually get all these done, only to be told by your Company Secretary that you need a number of registers in order to be compliant with the Companies Act 2019 (Act 992). You painfully look at your Company Secretary and ask the dreaded question: “which registers”? Your Company Secretary smiles and starts listing the registers your particular company needs. You are able to have a full-blown daydream and back, without the list ending and you painstakingly try to recollect what your company secretary listed:
- Register of Members (Section 35 of Act 992);
- Register of Directors and Company Secretary – (Section 215 of Act 992);
- Register of debentures – (Section 99 of Act 992);
- Branch Register – (Section 106 of Act 992);
- Register of Holdings of Directors – (Section 210 of Act 992);
- Interests Register – (Section 196 of Act 992); and
- Register of Particulars of Charges- (Section 115 of Act 992).
Your next question to your company secretary will probably be whether all these registers are mandatory? Thankfully, the answer is no. While there is a mandatory requirement to keep some registers, others can be dispensed with. For instance, Section 196(6) of Act 992 allows a company to dispense with the need for an Interests Register by passing an ordinary resolution by the members at a general meeting. On the other hand, there are some registers that are compulsory, such as the Register of Members and the Register of Directors and Company Secretary. Understandably, if a company has no debentureholders, there will not be a need to have a debenture register and in the absence of any charges being created, there will be no need for a register of particulars of charges.
There are penalties to be faced by companies which fail to keep the registers which are mandatorily required to be kept. For example, in respect of Register of Members, section 35(15) of Act 992 provides that where a company defaults in complying, the company and every officer of the company that is in default is liable to pay to the Registrar of Companies, an administrative penalty of 25 penalty units for each day during which the default continues. Currently, a penalty unit is equivalent to GHS12.
Over the years a number of companies in Ghana have shown a culture of minimal compliance when it comes to fulfilling the mandatory requirements under the Companies Act, especially when it comes to keeping registers. It is therefore quite surprising that the relatively new Act 992 places further requirements on companies to keep a number of registers.