A BRIEF OVERVIEW OF COMPANIES’ ACT IN TANZANIA
To register a company in Tanzania is a right of those who wish to associate and form themselves into a company pursuant to the existing company laws.
COMPANIES ACT CAP 212 (TANZANIA)
The law provides for the following types of companies
- Private companies
- Public companies
- Foreign companies (Branches of companies incorporated outside of Tanzania mainland)
PRIVATE COMPANIES
- Private companies are normally formed by persons with prior relationship other than only business relationship e.g. Father and sons and or daughters, friend etc.
- Minimum number of memberships is two and maximum is fifty.
- The shares of these companies are not freely transmissible.
- The transferability is subject to strict control and regulations, as such these types of companies may not list in the stock exchange for purposes of trading in shares.
- These types of companies are supposed to submit for filing annual returns and any other statutory fileable documents to the Registrar (e.g. Changes of particulars of directors, change of company names etc.). Filling fees are also payable and penalty for late filing is also levied.
PUBLIC COMPANIES
- Public companies are open ended, in that there is no maximum number of members, while the minimum number is also two.
- Any person may subscribe and buy shares in the company, which may be listed in the stock exchange.
- One condition for incorporating these types of companies is the issuance of a offer document which prior to its registration must be approved by the capital Markets and Securities Authority. An offer document is in essence an invitation to the general public to subscribe for shares.
- A private company may be converted to a public one by merely amending its Articles of Association and issuing a prospectus.
- These types of companies need to have very effective articles of association to regulate the relationships between the members themselves, members and company directors, dealers and stockbrokers (in cases of listed companies) with the stock exchange.
FOREIGN COMPANIES
- These types of companies are incorporated outside Tanzania mainland and they come in the country as branches of such foreign companies. Even if all subscribers and or shareholders are nationals of the United Republic of Tanzania, the companies are regarded as foreign.
- They are registered under part XII of the Companies Act.
- The Registration procedure of this type of companies includes the submission to the Registrar of :-
- Certified copies of Memorandum and Articles of Association.
- Notice of situation of the registered office in the country of domicile.
- List of Directors of the company.
- Person resident in the country who are the representatives of the company.
- Copy of most recent accounts and related reports of the company.
- Certificate of compliance is issued after the process.
ANNUAL RETURNS – ALL COMPANIES
All local companies need to submit annual returns for filing, which is done in prescribed forms. Company accounts (unless exempted under the law) form part of the returns. Foreign companies are required to file only audited balance sheets of their companies.
LOCAL COMPANIES REGISTRATION PROCEDURES
- Applicants submit a letter for name clearance, the registry clears establish: –
- The availability or non availability of the applied name
- Desirability of such name
- Applicants are then advised if the name is available or not after which they prepare Memorandum and Articles of Association and submit the same to the Registrar for registration process.
- Compliance with all requirements relating to formation of the company is declared in form no. 14b which is sworn before Commissioner for oath. Particulars of directors are given through form no. 14a and notice of the situation of the registered office is also given through the same form no. 14a, where physical locations and postal address must be provided.
POST REGISTRATION MATTERS
Any changes that occur in the company should be reported to the Registrar immediately. The registrar after noting the reported change registers the same on payment of filing fees. Penalty is charged if the change in particular is not reported in time.
If a company after one year fails to take off, for any reasons whatsoever, the officers thereof may notify the Registrar who issues notice to strike such company off the register off companies. If no notification is made, the Registrar has reason to believe that the company is carrying on business and is therefore required to comply with all the requirements relating to existing companies.
ASSURANCE FROM THE BUSINESS REGISTRATION AND LICENCING AUTHORITY (BRELA)
- The process of company registration is done under the law and is a transparent one.
- If the correct procedure is followed, the process takes approximately three days and not more than five days.
- If after five days the process is not completed, an applicant may demand, as of right, to see any member of the management who will provide an explanation or assist the applicant to be informed of reasons for delay.
- The office sincerely looks forward to having cooperation from the stakeholders whose views and suggestions on the improvement of services of the registry are taken very seriously.
BUSINESS NAMES
In Tanzania, business names are registered under the Business Names (Registration) Act (Chapter 213 of the Laws of Tanzania)
A business name helps to identify your business and hence advertise it.
Business Names do not acquire Corporate personality after their registration.
People are not compelled by the law to use names in their business, but they are compelled to register them if they use names in their business.
TRADE AND SERVICE MARKS
HOW TO REGISTER A TRADE OR SERVICE MARK IN TANZANIA
Application for registration of a trademark/service mark is made by filling in and filing form TM/SM 2 accompanied by form TM/SM 3. The forms are available on BRELA website or from Trade and Service Mark Agents.
POST REGISTRATION MATTERS ON TRADE AND SERVICE MARKS
- It has to be renewed after seven years. Any renewal thereafter lasts for ten years and then renewed consecutively
- Where the owner of the mark decides to assign it to someone else, this matter has to be communicated to the Registrar for registration and endorsement.
- Any change of name or address ought to be communicated to the Registrar. The same case applies to Mergers, Registered users (also known as licensing) and any other change in particulars registered.
INDUSTRIAL LICENCE
Under the National Industries (Registration and Licensing) ACT small scale Industries are issued with Certificate of Registration and large-scale Industries are issued with an Industrial License.
ISSUING OF AN INDUSTRIAL LICENCE
All investment costs that exceeds Tsh 100,000,000 are required to be submitted to the Industrial Licensing Board for approval. After the application has been approved by the Industrial Licensing Board the Registrar or Assistant Registrar of Industries issue the Temporary Industrial License which last for three (3) years in order to fulfill the condition which are written on the license.
CERTIFICATE OF REGISTRATION
An investment costs not exceeding Tshs. 100,000,000 is issued with a Certificate of Registration.
REQUIREMENTS FOR OBTAINING AN INDUSTRIAL LICENSE OR CERTIFICATE OF REGISTRATION
All applicants for Industrial License and Certificate of Registration are required to submit the following documents
- Fill application form No. 1
- Submit copies of Memorandum and Article of Association, & Certificate of Incorporation of a Company
- Submit Business plan
- Submit Lease agreement /Title Deed