By Delisa Thwala
In a significant move for the business landscape, the Ministry of Commerce, Industry, and Trade, led by Minister Manqoba Khumalo, has introduced the Companies Bill to the members of the House of Assembly Portfolio Committee.
This landmark bill aims to repeal the Companies Act of 2009, paving the way for a more modern and efficient regulatory framework.
The proposed Companies Bill comes with a host of objectives designed to enhance the ease of doing business and promote economic growth.
Minister Manqoba Khumalo, when breaking down the bill, said it would help with streamlined registration, where the bill will emphasize the efficient registration and incorporation of companies through electronic and online platforms, making it easier for entrepreneurs to start their ventures.
“Flexible company structures, the bill advocates for economically efficient and adaptable company structures, allowing businesses to thrive in a dynamic marketplace.
Modernized Regulations where the application of updated rules will ensure that companies operate under regulations that reflect contemporary business practices,” said the Minister.
He further said the bill will promote orderly closure procedures where the bill provides clear procedures for the efficient and orderly winding up of a company, including liquidation and receivership, as well as guidelines for voluntarily ceasing operations.
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“ This bill will help with enhanced transparency, a crucial aspect of the bill which is the compulsory identification of beneficial owners,
ensuring greater transparency and accountability in corporate governance. It also assesses liability against shadow directors and prohibits the issuance of bearer shares,” said Khumalo.
He further said this forward-thinking initiative promises to create a more robust business environment, fostering innovation and growth.
Worth mentioning is that the proposed Companies Bill 2024 seeks to provide, among other things, non-excessive regulation and administration of companies in Eswatini.
The Bill that has since been published or gazetted seeks to repeal the Companies Act of 2009. It is worth noting that during the last quarter of the 2023/24 financial year,
the draft of the Companies Bill 2024 submitted to the Attorney General’s Office was approved, reviewed by the New Zealand consultants, and was ready to be submitted to Cabinet for approval.
The Bill will provide for the efficient registration and incorporation of companies on electronic and online platforms. In this regard, the Ministry of Commerce, Industry, and Trade, through its annual report for 2023, indicated the continuation of the ease of doing the business program.
Minister Khumalo, through the report, stated that along with the ease of doing business, his ministry has progressed very well with the implementation of the Electronic Business Registry project, which is sponsored by the Government of New Zealand.
Therefore, this Bill will be the supporting instrument for this initiative. In the report, the minister indicated that the team of experts will be visiting the country to start Phase II, which entails the design, procurement, and installation of the Electronic Business Registry.
The final diagnosis of the current online company registration system and trading licenses system, design, and procurement of the new systems, and migration of databases to the new platform will continue in the new financial year, 2024/2025.
He said the project aims to transform Eswatini to a First World status, where starting a business shall be done within one day of registration.
Furthermore, the Bill seeks to provide for economically efficient and economically enhancing flexible and adaptable company structures; a modern and clear statement of the rules that apply to companies; procedure for the creditors of an insolvent company to enter into a compromise with a company;
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the efficient and orderly liquidation of insolvent companies and modernize the law relating to company receiverships.
Khumalo urged Parliament to fast-track the process of debating and passing the draft Companies Bill once it has been tabled in Parliament.
It is worth noting that last year, the ministry was able to review the Industrial Development Policy, Handicraft Policy, and the Regulatory and Quality Infrastructure Policy.
In the period under review, the ministry was on the verge of developing the following policies: the MSMEs Policy, the Investment Policy, and the Cooperative Policy.
The ministry is convinced that these policies shall impact positively on the economy. The ministry echoed the United Nations Development Partner for ushering in the review of the MSMEs Policy.
This year, the ministry is pushing for the operationalization of the recently enacted Citizen Economic Empowerment (CEE) Act. Khumalo further announced the readiness of the Citizens Economic Council.
According to the Minister, the council’s role will be responsible for the implementation of the Citizens Economic Empowerment Act, which seeks to make sure that local businesses get a fair chance when competing with international businesses.
He mentioned that his ministry will soon be announcing who will be part of the council. The Act aims to prioritize local entities over foreign direct investors.
When speaking at the Happy Valley Hotel during the inaugural Family Business Summit earlier, the minister mentioned that they were busy disputing the fallacy that the government only supports foreign direct investments and prioritizes them over Indigenous entities.
