In this Code, unless the context otherwise requires, the expressions defined in the First Schedule hereto shall have the meanings assigned to them in that Schedule.
Section 3-Application of Act
(1) Except where otherwise provided, the provisions of this Code shall apply to all companies formed in Ghana, whether before or after the commencement of this Code, under the provisions of the Companies Ordinance, (Cap. 193) or this Code.
(2) Nothing in this Code contained shall affect the validity of anything done before the date when the Code comes into operation.
(3) The provisions of this Code which require or may require immediate action by existing companies when this Code comes into operation are referred to in the Ninth Schedule to this Code.
Section 4-Application of Particular Chapters of the Code
(1) The provisions of Chapter III of this Code shall apply to private companies but not to public companies.
(2) The provisions of Chapter IV of this Code shall apply to public companies but not to private companies.
(3) The provisions of Chapter V of this Code shall not apply to companies formed in Ghana.
Section 5-Prohibition of Partnerships Exceeding 20 Members
No company, association or partnership consisting of more than twenty persons shall be formed for the purpose of carrying on any business that has for its object the acquisition of gain by the company, association or partnership, or by the individual members thereof, unless it is registered as a company under this Code or is formed in pursuance of some other enactment for the time being in force.
Section 6-Companies formed for Special Purposes
Nothing in this Code shall abrogate or affect any special legislation relating to companies carrying on the business of banking, insurance or any other business from time to time subject to special regulation.
Section 7-Saving of Equity and Common Law
The rules of equity and of common law applicable to companies shall continue in force except so far as they are inconsistent with the provisions of this Code.
Section 8-Right to form a Company
Any one or more persons may form an incorporated company by complying with the provisions of this Code in respect of registration.
Section 9-Types of Company
(1) An incorporated company may be either,
(a) a company having the liability of its members limited to the amount, if any, unpaid on the shares respectively held by them, in this Code referred to as a company limited by shares; or
(b) a company having the liability of its members limited to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up, in this Code referred to as a company limited by guarantee; or
(c) a company not having any limit on the liability of its members, in this Code referred to as an unlimited company.
(2) A company of any of the foregoing types may either be a private company or a public company.
(3) A private company shall be a company which by its Regulations,
(a) restricts the right to transfer its shares, if any;
(b) limits the total number of its members and debentureholders to fifty, not including persons who are bona fide in the employment of the company and persons who, having been formerly bona fide in the employment of the company, were while in that employment, and have continued after the determination of that employment to be, members or debentureholders of the company;
(c) prohibits the company from making any invitation to the public to acquire any shares or debentures of the company; and
(d) prohibits the company from making any invitation to the public to deposit money for fixed periods or payable at call, whether bearing or not bearing interest:
Provided that where two or more persons hold one or more shares or debentures jointly, they shall, for the purposes of this subsection, be treated as a single member or debentureholder.
(4) Any other company shall be a public company.
(5) A company limited by shares and an unlimited company shall be registered with shares.
(6) A company limited by guarantee shall not be registered with shares and shall not create or issue shares.
Section 10-Companies Limited by Guarantee
(1) A company limited by guarantee may not lawfully be incorporated with the object of carrying on business for the purpose of making profits.
(2) If any company limited by guarantee shall carry on business for the purpose of making profits, all officers and members thereof who shall be cognisant of the fact that it is so carrying on business shall be jointly and severally liable for the payment and discharge of all the debts and liabilities of the company incurred in carrying on such business, and the company and every such officer and member shall be liable to a fine not exceeding five pounds for every day during which it shall carry on such business.
(3) The total liability of the members of a company limited by guarantee to contribute to the assets of the company in the event of its being wound up shall not at any time be less than one hundred pounds.
(4) Subject to compliance with subsection (3) of this section, the Regulations of a company limited by guarantee may provide that members can retire or be excluded from membership thereof.
(5) If in breach of subsection (3) of this section the total liability of the members of any company limited by guarantee shall at any time be less than one hundred pounds, every director and member of the company who is cognisant of the breach shall be liable to a fine not exceeding one hundred pounds.
Section 11-Conversion of Company Limited by Shares to Company Limited bu Guarantee
(a) there is no unpaid liability on any of its shares;
(b) all its members agree in writing to such conversion and to the voluntary surrender to the company for cancellation of all the shares held by them immediately prior to the conversion;
(c) new Regulations, appropriate to a company limited by guarantee, are adopted by the company pursuant to section 22 of this Code;
(d) a member or members agree in writing to contribute to the assets of the company, in the event of its being wound up, to an extent not less than that prescribed by subsection (3) of section 10 of this Code.
(2) Upon delivery to the Registrar for registration of,
(a) a copy of the said new Regulations and of the special resolution adopting the same, and
(b) a statutory declaration by a director and the secretary of the company confirming that the conditions of the immediately preceding subsection have been complied with,
the Registrar shall issue a new certificate of incorporation altered to meet the circumstances of the case; and as from the date mentioned in such certificate the company shall be converted into a company limited by guarantee, the shares therein shall be validly surrendered and cancelled notwithstanding the provisions of section 56 of this Code, and any members of the company who have not agreed to contribute to the assets of the company in the event of its being wound up shall cease to be members thereof:
(a) except in accordance with subsection (3) of section 15 of this Code, the company may not change the name under which it was registered prior to the conversion; but the omission of the word "Limited" as the last word of the name of the company after conversion shall not be regarded as a change of name;
(b) if the Registrar is of the opinion that the name under which the company is registered will be misleading or undesirable on its conversion to a company limited by guarantee he shall, in accordance with subsection (5) of section 15 of this Code, direct the company to change its name and shall not issue a new certificate of incorporation until the direction has been complied with or cancelled in accordance with the provisions of that subsection;
(c) until a new certificate of incorporation is issued the former Regulations shall continue to apply and neither the surrender of the shares of the company nor the agreement to contribute to the assets of the company in the event of its being wound up shall take effect.
(3) The conversion of a company pursuant to the provisions of this section shall not affect any rights or obligations of the company except as mentioned in this section or render defective any legal proceedings by or against the company.
Section 12-Duties of Promoters
(1) Any person who is or has been engaged or interested in the formation of a company shall be deemed to be a promoter of that company:
Provided that a person acting in a professional capacity for persons engaged in procuring the formation of the company shall not thereby be deemed to be a promoter.
(a) stand in a fiduciary relationship to the company;
(b) observe the utmost good faith towards the company in any transaction with it or on its behalf; and
(c) compensate the company for any loss suffered by it by reason of his failure so to do.
(3) A promoter who acquires any property or information in circumstances in which it was his duty as a fiduciary to acquire it on behalf of the company shall account to the company for such property and for any profit which he may have made from the use of such property or information.
(4) Any transaction between a promoter and the company may be rescinded by the company unless, after full disclosure of all material facts known to the promoter, the transaction shall have been entered into or ratified on behalf of the company,
(a) if all the company's directors are independent of the promoter, by the company's board of directors; or
(b) by all the members of the company; or
(c) by the company at a general meeting at which neither the promoter nor the holders of any shares in which he is beneficially interested shall have voted on the resolution to enter into or ratify that transaction.
(5) No period of limitation shall apply to any proceedings brought by a company to enforce any of its rights under this section; but in any such proceedings the Court may relieve a promoter in whole or in part and on such terms as it thinks fit from liability hereunder if in all the circumstances, including lapse of time, the Court thinks it equitable so to do.
Section 13-Pre-incorporation Contracts
(1) Any contract or other transaction purporting to be entered into by a company prior to its formation or by any person on behalf of the company prior to its formation may be ratified by the company after its formation; and thereupon the company shall become bound by and entitled to the benefit thereof as if it had been in existence at the date of such contract or other transaction and had been a party thereto.
(2) Prior to ratification by a company the person or persons who purported to act in the name or on behalf of the company shall, in the absence of express agreement to the contrary, be personally bound by the contract or other transaction and shall be entitled to the benefit thereof.
(ii) the objects for which the company is being formed or the business which it is to carry on, or any of them are unlawful;
(iii) any of the subscribers to the Regulations is an infant or of unsound mind; or
(iv) any of the directors named in the Regulations is under section 182 of this Code, incompetent to be appointed a director,
the Registrar shall register the said Regulations;
(c) upon registration of the Regulations, the Registrar shall certify under his seal that the company is incorporated and, in the case of a limited company, that the liability of its members is limited;
(d) from the date of registration mentioned in the certificate of incorporation, the company shall be a body corporate by the name contained in the Regulations and, subject as provided in sections 27 and 28 of this Code, be capable forthwith of exercising all the functions of an incorporated company;
(e) the Registrar shall insert a notice in the Gazette stating the issue of such certificate and the terms thereof;
(f) the certificate of incorporation, or a copy thereof, certified as correct under the hand of the Registrar, or the Gazette containing the notice referred to in paragraph (e) of this section, shall be conclusive evidence that the company has been duly registered and incorporated under this Code and no proceedings shall be brought in any Court to cancel or annul such registration:
Provided that nothing in this paragraph contained shall prejudice the institution of proceedings to wind up the company in accordance with section 247 of this Code.
Section 15-Names of Companies
(1) The last word of the name of a company limited by shares shall be "Limited":
Provided that an existing company limited by shares which has been licensed under section 15 of the Companies Ordinance (Cap. 193), to dispense with the word "Limited" shall retain the right to such dispensation until the expiration of six months after the commencement of this Code.
(2) No company shall be registered by a name which, in the opinion of the Registrar, is misleading or undesirable.
(3) A company may, by special resolution and with the approval of the Registrar signified in writing, change its name.
(4) If, through inadvertence or otherwise, a company on its first registration or on its registration by a new name is registered by a name which, in the opinion of the Registrar, is misleading or undesirable, the company may change its name with the sanction of the Registrar, and if the Registrar shall so direct within six months of its being registered by that name, shall change it within a period of six weeks from the date of the direction or such longer period as the Registrar may think fit to allow.
(5) If the Registrar is of the opinion that by reason of any change in the objects of, or the nature of the business carried on by a company the name under which it is registered is misleading or undesirable, the Registrar may direct such company to change its name and the company shall change its name within six weeks of such direction, unless within that time it shall have lodged an appeal to the Court against such direction.
(6) The Court shall, thereupon, either cancel or confirm such direction and its decision shall be final and conclusive; and if the direction shall be confirmed, the company shall change its name within six weeks of such confirmation.
(7) If a company makes default in complying with a direction under either of the three immediately preceding subsections it and any director of the company who is cognisant of the default shall be liable to a fine not exceeding five pounds for every day during which the default continues.
(8) Where a company changes its name under this section the Registrar shall enter the new name on the register in place of the former name, and shall issue a certificate of incorporation altered to meet the circumstances of the case.
(9) Any alteration so made shall be advertised by the Registrar in the Gazette and in one newspaper published in Ghana and circulating in the district in which the registered office of the company is situated.
(10) A certificate or an advertisement in the Gazette under this section shall be conclusive evidence of the alteration to which it relates.
(11) A change of name by a company shall not affect any rights or obligations of the company or render defective any legal proceedings by or against the company, and any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its new name.
(12) The Registrar may, on written application and on payment of the prescribed fee, reserve a name pending registration of a company or a change of name by a company.
(13) Any such reservation shall be for such period as the Registrar shall think fit not exceeding two months and during the period of reservation no other company shall be registered under the reserved name or under any other name which in the opinion of the Registrar is too like the reserved name.
Part B—The Company's Regulations
Section 16-Contents of Regulations
(1) This section shall apply to any company registered after the commencement of this Code and to an existing company which, pursuant to section 19 of this Code, adopts Regulations in lieu of its memorandum and articles of association.
(2) The Regulations of a company shall state,
(a) the name of the company, with "Limited" as the last word of the name in the case of a company limited by shares;
(b) the nature of the business or businesses which the company is authorised to carry on, or if the company is not formed for the purpose of carrying on a business, the nature of the object or objects for which it is established;
(c) that the company has, for the furtherance of its authorised businesses or objects, all the powers of a natural person of full capacity except in so far as such powers are expressly excluded by the Regulations;
(d) the names of the first directors of the company;
(e) that the powers of the directors are limited in accordance with section 202 of this Code.
(3) The Regulations of a company limited by shares or by guarantee shall also state that the liability of its members is limited.
(4) In the case of a company having shares the Regulations shall also state the number of shares with which the company is to be registered.
(5) In the case of a company limited by guarantee the Regulations shall also,
(a) contain a regulation in the terms of regulation 3 of Table B in the Second Schedule to this Code, with such modifications as the Registrar shall allow, stating that the income and property of the company shall be applied solely towards the promotion of its objects, and that no portion thereof shall be paid or transferred directly or indirectly to the members of the company except as therein permitted;
(b) state that each member undertakes to contribute to the assets of the company in the event of its being wound up while he is a member or within one year after he ceases to be a member, for payment of the debts and liabilities of the company, and of the costs of winding up, such amount as may be required not exceeding a specified amount; and
(c) state that if, upon the winding up of the company, there remains after the discharge of all its debts and liabilities any property of the company the same shall not be distributed among the members but shall be transferred to some other company limited by guarantee having objects similar to the objects of the company or applied to some charitable object, such other company or charity to be determined by the members prior to the dissolution of the company.
(6) The Regulations may contain any other lawful provisions relating to the constitution and administration of the company.
Section 17-Form of Regulations
(1) In the case of a company registered after the commencement of this Code, or an existing company which, pursuant to section 19 of this Code, adopts Regulations in lieu of its memorandum and articles of association, the form of the Regulations of,
(a) a private company limited by shares,
(b) a public company limited by shares,
(c) a company limited by guarantee,
shall be respectively in accordance with the forms set out in Table A Part I, Table A Part II, or Table B, in the Second Schedule to this Code or as near thereto as circumstances may admit; and the form of the Regulations of an unlimited company shall be in accordance with the form set out in Table A Part I, if a private company, or Table A Part II, if a public company, or as near thereto as circumstances may admit, but with such modifications as are necessary having regard to the fact that the liability of the members is unlimited.
(2) The Regulations may adopt such of the provisions of the appropriate Table as are not required, by section 16 of this Code, to be stated in the Regulations, and, in so far as the Regulations do not exclude or modify those provisions, they shall, so far as applicable, be part of the Regulations of the company.
(3) The Regulations shall be printed, typewritten, or in some other legible form acceptable to the Registrar.
Section 18-Subscribing to Regulations
(1) The Regulations of any company registered after the commencement of this Code shall be signed by one, or more subscribers in the presence of, and shall be attested by, one witness at the least.
(2) In the case of Regulations of a company with shares the subscribers, or each subscriber if more than one, shall write opposite to his name the number of shares he takes and the cash price payable therefor, and shall take at least one share.
(3) The Regulations shall not be chargeable to any stamp duty.
Section 19-Regulations of Existing Companies
(1) An existing company may, by special resolution, adopt Regulations in the form required by this Code in lieu of its memorandum and articles of association and may adopt such of the provisions of the appropriate Table in the Second Schedule hereto as are not required, by section 16 of this Code, to be stated in the Regulations.
(2) Any reference in this Code to the Regulations of a company shall, in the case of an existing company which has not adopted Regulations in lieu of its memorandum and articles, be deemed to be a reference to its memorandum and articles of association.
(3) Nothing in subsection (1) of this section shall be deemed to authorise any company to alter the substance, as opposed to the form, of its Regulations except as mentioned in section 22 of this Code.
Section 20-Prints of Tables A and B
Where the Regulations of a company include without express repetition all or any of the provisions of Table A or B, a printed copy of the appropriate Table or, in the case of Table A, of the appropriate Part thereof shall be attached to every copy of such Regulations.
Section 21-Effects of Regulations
(1) Subject to the provisions of this Code, the Regulations, when registered, shall have the effect of a contract under seal between the company and its members and officers and between the members and officers themselves whereby they agree to observe and perform the provisions of the Regulations, as altered from time to time, in so far as they relate to the company, members, or officers as such.
(2) Where the Regulations empower any person to appoint or remove any director or other officer of the company such power shall be enforceable by that person notwithstanding that he is not a member or officer of the company.
(3) In any action by any member or officer to enforce any obligation owed under the Regulations to him and any other member or officer, such member or officer shall, if any other member or officer is affected by the alleged breach of such obligation, sue in a representative capacity on behalf of himself and all other members or officers who may be affected other than any who are defendants and the provisions of section 324 of this Code shall apply.