Corporate Law at Eswatini
Here’s an overview of Corporate Law in Eswatini (formerly Swaziland):
Corporate Law in Eswatini
1. Legal Framework
Eswatini’s corporate law is primarily governed by the Companies Act, 2009 (Act No. 7 of 2009), which replaced the previous Companies Act of 1912.
The Act governs the formation, management, and dissolution of companies.
Eswatini follows a common law system influenced by South African and English law.
The Registrar of Companies, under the Ministry of Commerce, Industry and Trade, is responsible for company registration and regulation.
2. Types of Companies
The Companies Act recognizes several forms of companies:
Private Company (Most common type)
Public Company
Non-Profit Company
Foreign Company (Branch of a foreign company registered to do business in Eswatini)
A Private Company generally restricts the transfer of shares and limits the number of shareholders.
3. Company Formation
Companies must be registered with the Registrar of Companies.
Required documents typically include:
Memorandum of Incorporation (MOI)
Articles of Association (if applicable)
Details of directors and shareholders
Registered office address
The registration process is straightforward but usually requires physical submission of documents.
4. Corporate Governance
Companies must have at least one director.
Directors owe fiduciary duties to the company.
Annual General Meetings (AGMs) are required for public companies; private companies may dispense with this requirement if all shareholders agree.
Companies must maintain proper accounting records and prepare annual financial statements.
5. Share Capital
The Companies Act does not specify a minimum share capital for private companies.
Shares may be issued as ordinary or preference shares.
Shareholders’ liability is limited to the amount unpaid on their shares.
6. Foreign Investment
Foreigners can own 100% of companies in Eswatini.
There are no significant restrictions on foreign investment, but registration and compliance with local regulations are required.
Certain sectors may require licenses or special approval.
7. Taxation
Corporate income tax in Eswatini is levied at a standard rate of around 27%.
Other taxes applicable include Value Added Tax (VAT), withholding taxes, and payroll taxes.
8. Dispute Resolution
Commercial disputes are handled in the High Court of Eswatini.
Arbitration and mediation are alternative dispute resolution methods commonly used.
The legal system is based on common law and has a reputation for fairness, though some delays can occur.
9. Key Challenges
Bureaucracy and administrative delays can sometimes slow down company registration and compliance.
The legal framework is evolving but still less developed compared to larger economies.
Infrastructure limitations can affect business operations.
Summary
| Aspect | Details |
|---|---|
| Governing Law | Companies Act, 2009 |
| Common Company Types | Private and Public Companies |
| Share Capital | No fixed minimum for private companies |
| Foreign Ownership | Allowed 100% |
| Corporate Tax Rate | ~27% |
| Registration Body | Registrar of Companies |
| Legal System | Common Law (influenced by South Africa and UK) |
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