1. What types of business entities may be registered in Ghana?
A business may register and operate as any of the following entities:
a. A Sole Proprietorship – A sole proprietorship is an unincorporated business usually run by one individual in his or her legal name, or under a trade name. A sole proprietor who adopts a trade name must register and renew the registration annually. A sole proprietor is prohibited from carrying out business in the finance, banking or communications sectors. The liability of a sole proprietor is unlimited.
b. Partnership – A partnership is an association of two or more individuals (not exceeding twenty) carrying out business jointly for the purpose of making profit. A partnership must be registered. The members of a partnership are referred to as “partners”, and the terms and conditions of their relationship are documented in a partnership agreement.
c. Company – A company refers to an entity incorporated under the Ghana Companies Act, 1963 (Act 179) which upon incorporation acquires a separate legal identity distinct from its members, officers, and directors. Under Ghanaian law, an incorporated company may be any of the following and either of these may be a private or public company:
i. Limited Liability Company – The liability of members in this type of company is limited to the amount unpaid, if any, on the shares they have subscribed to.
ii. Company Limited by Guarantee – This type of company is prohibited from registering with shares, creating or issuing shares. The liability of members of such companies are limited to the amount the members may agree to contribute to the assets of the company in the event of the company being wound up.
iii. Unlimited Company – This refers to companies that have no limit on the liability of their members. Although it is unusual for companies to incorporate with unlimited liability, some professional services companies are required to operate their business under this type of company.
2. What are the requirements for incorporating a company?
To incorporate a company, one must comply with the requirements for incorporation stipulated under the laws of Ghana. These include:
a. a copy of the proposed regulations of the company;
b. a minimum of two directors, each being above 21 years. At least one of the directors must be present in Ghana at all times;
c. members of the company;
d. an auditor;
e. number of shares and subscription details if applicable;
f. the minimum stated capital as prescribed under law; and
g. capital duty, which is currently 0.5% of the company’s stated capital.
3. Who can be a shareholder of a company?
The minimum legal age in Ghana is 18 years. Thus only a person above the age of 18 years can be a shareholder. However, persons under the age of 18 years can be beneficial owners of shares held in trust for such persons
4. Who can be a director of a company?
To be a director in Ghana, a person must be of sound mind, be an individual above 21 years of age, and should not be an undischarged bankrupt. An artificial being such as a company, cannot act as a director. A person may also be considered incompetent to act as a director if that person is deemed to have been associated with acts of fraud. There may be further requirements placed on directors of companies in specific industries.
5. Do the directors need to be Ghanaian?
No. A foreign national who satisfies the requirements for competency under Ghanaian law can act as a director.
6. Who can be a company secretary of a company?
Any competent individual or a body corporate appointed by the directors can act as a company secretary.
7. What is the nature of shares issued in Ghana?
Shares issued in Ghana are of no par value. This means that the shares are issued without a nominal value being assigned to the shares in the company’s regulations.
8. How many shares may be authorised?
The authorised number of shares is as determined by the shareholders and thereafter stated in the regulations of the company. This number may be however be amended.
9. Can a foreign company establish a branch in Ghana, and if so what are the requirements?
Certainly. This is known as an external company. That is, a body corporate formed outside Ghana that has an established place of business in Ghana. The requirements for registering an external company in Ghana are:
a. an established place of business in Ghana;
b. the appointment of a local manager;
c. the provision of a certified copy of the Regulations of the foreign company; and
d. the provision of certified copies of the particulars of the foreign company.
10. Who can act as a local manager for an external company or branch office?
Any person who is deemed competent to act as a director under the law can act as local manager for an external company or a branch office.
11. How long does it take to register or incorporate a company and how much does it cost?
The estimated processing time for the registration or incorporation of companies is two weeks. This is subject to the Registrar being satisfied with all supporting documents and submitted forms. The cost of registration or incorporation depends on the type of company being registered or incorporated.