Corporate Law at Zambia
Here’s a summary of Corporate Law in Zambia:
Corporate Law in Zambia
1. Legal Framework
The primary legislation governing corporate law in Zambia is the Companies Act No. 10 of 2017, which modernized company law to align with international best practices.
Other relevant laws include the Business Names Registration Act, Insolvency Act, and sector-specific regulations.
The Patents and Companies Registration Agency (PACRA) is responsible for company registration and regulation.
2. Types of Business Entities
Private Limited Companies (Ltd)
Public Limited Companies (plc)
Companies Limited by Guarantee (often non-profits)
Sole Proprietorships and Partnerships
Foreign Companies (branches of companies incorporated outside Zambia)
3. Company Formation
To incorporate, an applicant must:
Reserve a company name through PACRA.
Submit the Memorandum and Articles of Association.
Provide details of directors, shareholders, and the registered office.
PACRA issues a Certificate of Incorporation upon successful registration.
A Business Name Certificate is available for sole proprietorships and partnerships.
4. Corporate Governance
Minimum of one director required; public companies require at least two.
Appointment of a company secretary is mandatory for public companies.
Directors must comply with fiduciary duties and statutory obligations under the Companies Act.
Companies must hold Annual General Meetings (AGMs) and file annual returns.
5. Taxation and Incentives
Companies are subject to corporate income tax, administered by the Zambia Revenue Authority (ZRA).
Other taxes include Value Added Tax (VAT), withholding tax, and Pay-As-You-Earn (PAYE) for employees.
Zambia offers investment incentives through the Zambia Development Agency (ZDA), including tax holidays and customs duty exemptions in targeted sectors.
6. Foreign Investment
Foreign companies can register branches in Zambia.
The ZDA promotes foreign investment and facilitates business licensing.
Foreign ownership is generally allowed but may be restricted in some sectors.
7. Regulatory Compliance
Companies must file annual returns and audited financial statements with PACRA.
Compliance with labor laws, environmental regulations, and anti-money laundering laws is required.
Sector-specific regulators oversee industries like banking, insurance, and mining.
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