10 JUL 2019
Striking off a company on Registrar’s own initiative
The ministry of economic development has gazetted regulation number 2019/R-1034 on 18th June 2019 (‘the Regulation’) regarding the procedure to strike off the name of a company off the register on the Registrar’s own initiative.
The Regulation specifies the procedure to strike off the name of a company off the Companies Register on the Registrar’s own initiative pursuant to subparagraph 75 (b) (1) of the Companies Act. This discretionary power of the Registrar to strike off a company will be exercised in four circumstances. They are:
A company fails to pay its annual fees for the year in question by the end of month of May as required under subsection 7 (b) of the Companies Act;
A period of one year lapses from the date of company registration without conducting any business activities pursuant to the company’s objectives;
A period of two years lapses without the company conducting any business activities pursuant to its objectives;
A company does not settle fines under subsection 69 (b) of the Companies Act for failure to file its annual financial reports, directors’ report, and audit report within fifteen days of its annual general meeting as required under subsection 69 (a) of the Companies Act, by the end of month of June, and does not file the said statutory accounts within same deadline.
If the Registrar decides to strike off a company due to the existence of any of the circumstances mentioned above, he or she shall publish a notice in the government gazette to find out whether or not the company has any claims against it or any outstanding liabilities. The published notice will specify the particulars of the company and the reason for Registrar’s decision to strike off the company.
Where a party has a claim or outstanding receivables with respect to the company, it shall notify the Registrar of such information within fourteen days of the gazette notice by furnishing the Ministry of Economic Development with the information in such manner as specified by the Registrar in the notice. Upon receiving notification of unsettled claims or liabilities, the Registrar will file a motion with relevant court for the dissolution of the company.
If no notice of unsettled claims or liabilities is given to the Registrar within the fourteen-day period, the Registrar will apply to the Ministry of Finance and Treasury to request for relief from fees and fines unpaid by the company.
Following the Registrar’s decision to strike off, a company that wishes to resume its business is required to discharge its unfulfilled obligations within fourteen days of notice on the gazette, and notify the Registrar of intention to resume by submitting a resolution of the board of directors to that effect together with documents evidencing rectification.
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