The law will give Zimbabweans the right to take over and control many foreign-owned companies in Zimbabwe. Specifically, over 51 per cent of all the businesses in the country will be transferred into local African hands. The law does not specify whether or not the transfer of ownership would simply apply to mergers and restructurings in the future, or if it applies to all current companies. This is not a new idea because there have been proposals for similar transfer actions, but have all come up fruitless. President Mugabe administration had already redistributed the commercial farms owned by non-black-African farmers to poor native Zimbabweans.
|Published (Last):||17 March 2008|
|PDF File Size:||17.20 Mb|
|ePub File Size:||8.35 Mb|
|Price:||Free* [*Free Regsitration Required]|
The amendments, contained in the Finance Act, which was published in a March 14 Government Gazette Extraordinary, also extend ownership of businesses in the 12 reserved sectors to "citizens of Zimbabwe" as opposed to "indigenous citizens. Non-citizens who commenced business before Jan.
The new fund will be housed within the designated ministry and staffed entirely by members of the civil service. It replaces the former National Indigenization and Economic Empowerment Board, which functioned as an autonomous body outside the civil service framework. In addition, the continued operation of businesses by non-citizens in designated areas will be subject to them opening and maintaining bank accounts in accordance with the law.
Veritas Zimbabwe, an organization that provides information on the work of the Parliament of Zimbabwe and laws of the country, applauded the amendments. The organization noted that any person is now free to invest in, form, operate and acquire ownership or control of any other business outside the reserved ones. The 12 reserved sectors are: transportation passenger buses, taxis and car hire services ; retail and wholesale trade; barber shops, hairdressing and beauty salons; employment agencies; estate agencies; valet services; grain milling; bakeries; tobacco grading and packaging; advertising agencies; provision of local arts and crafts and their marketing and distribution; and artisanal mining.
Veritas said a new section of the amended act is designed to ensure that in the course of time at least 51 percent of any designated extractive business is owned through an appropriate designated entity. Ownership can be with or without the participation of a community share-ownership scheme or employee share-ownership scheme or trust. The minister responsible for the act is empowered to give written permission to a business to comply with the act over a period specified by the minister," Veritas explained.
Non-citizens wishing to open businesses in a reserved sector after Jan. The amendments also provide for the continuation of certain tax incentives enjoyed before March 14, , and give an opportunity for businesses to revise indigenization implementation plans already approved under the law on indigenization. Veritas said it is not clear to what extent the Indigenization and Economic Empowerment General Regulations of remained in force.
The responsible minister should clarify this by amending or repealing the regulations and notices as soon as possible," Veritas said.
It is also not clear which minister will be responsible for the act since no current minister has the word "indigenization" in his or her title.
Veritas urged President Emmerson Mnangagwa to clarify the position as soon as possible by assigning the act to one of his ministers.
Back to Top. Zimbabwe government officially amends indigenization law Source: Xinhua Zimbabwe government officially amends indigenization law. Related News. Zimbabwe's Mnangagwa names externalizers as million USD is returned. EU observers arrive in Zimbabwe on pre-election assessment mission. Zimbabwe, South Africa pledge to deepen ties. Zimbabwe's Mnangagwa issues final warning as amnesty on externalization ends.
Mnangagwa says Zimbabwe "has moved on" after Mugabe's televised challenge.
Amendments to Zimbabwe’s indigenisation laws to open economy to foreign investment
Referral to Minister of proposed notifiable transactions in respect of which no counterparties have yet been identified. Transfer of employees of National Investment Trust to Board and conditions of service of transferred employees. To provide for support measures for the further indigenisation of the economy; to provide for support measures for the economic empowerment of indigenous Zimbabweans; to provide for the establishment of the National Indigenisation and Economic Empowerment Board and its functions and management; to provide for the establishment of the National Indigenisation and Economic Empowerment Fund; to provide for the National Indigenisation and Empowerment Charter; and to provide for matters connected with or incidental to the foregoing. Provided that any such notice which is in force on the date of commencement of the Finance No. Provided that the line Minister may issue a provisional certificate to the business in question instead of a final one if the business undertakes or is is required to comply with any specified conditions. Provided if the Minister, at any time before the expiry of the forty-five days referred to in this paragraph, indicates in writing to the notifying party that he or she requires more time to consider the transaction, the Minister shall have a further forty-five days to indicate his or her approval or disapproval of the transaction. Provided that the Minister shall not disapprove of a transaction referred to in subsection 1 except on the grounds that the transaction does not comply with the objectives specified in section 3 1 b , c , d or e , as the case may be.
Zimbabwe government officially amends indigenization law
Please contact customerservices lexology. These far-reaching changes, first announced in the Budget in December , should pave the way for foreign investors wishing to establish operations in the country and boost the economy. Any other person is free to invest in, form, operate and acquire the ownership or control of any business without restriction. Affected companies may apply to the minister potentially, the Minister of Finance to be assigned to administer the Act for permission to comply with the Act within an agreed period of time. In respect of reserved sectors, only a business owned by a Zimbabwean citizen may operate in such sectors. Accordingly, under the amended Act, anyone of any race may qualify, provided they hold Zimbabwean citizenship. Companies owned by foreigners that have been operating in reserved sectors prior to 1 January , may continue to do so if, before 1 July , they register with the Zimbabwe Revenue Authority and the National Indigenisation and Economic Empowerment Unit and open a local bank account.