Companies (Amendment) Act, 2011

Section 2 adds new defined terms for the register of receivers and the register of liquidators.

This provision repeals section 6 of the principal Act and replaces it with new text.

Two or more associated persons may incorporate a company by signing an incorporation application in the prescribed form and paying the prescribed fee. Certain individuals are barred from subscribing to the application, including minors, bankrupts, persons under relevant court orders, persons of unsound mind, and recent fraud or dishonesty offenders.

This provision amends Section 37 by deleting subsection (3) and renumbering subsections (4) and (5).

This provision amends the principal Act by repealing section 41 and replacing it with new text.

The Registrar may refuse a proposed company name, direct a company to change its name, and in some cases register a substitute name; if refusal occurs, the Registrar must give reasons within seven days.

A person transferring shares in a private company must notify the Registrar in the prescribed manner and form, subject to sections 64 and 66.

This section adds a rule that an individual cannot be appointed as a receiver unless eligible under section 111.

This section amends the principal Act by inserting new sections 109A and 109B after section 109.

Directors must prepare and submit a company affairs statement to the receiver within three months after a receiver is appointed, unless the court says otherwise.

A person, company, or officer in default who contravenes section 109A commits an offence and may be fined, imprisoned, or both.

This section amends the principal Act by repealing section 111 and replacing it with new text.

A person who wants to act as a receiver must apply for accreditation, and the Minister must set the qualifications and certificate procedure.

This provision amends the principal Act by inserting a new section after section 111.

A receiver is entitled to a fee based on the gross proceeds of the receivership, but the amount cannot exceed fees set by statutory instrument.

The court may, on application, set a receiver’s remuneration and later change that order.

This provision amends the principal Act by repealing section 117 and replacing it with new text.

A receiver must file periodic receipts-and-payments abstracts with the Registrar, and may have to produce documents or information on request.

A receiver’s office ends in specified events, the receiver may resign with one month’s written notice, the holder of the charge must notify the Registrar after cessation or removal, and a breach of the section is an offence.

This provision amends the principal Act by inserting new sections 188A and 188B after section 188.

A qualifying company must file a "no change" return if its status has not changed, use the prescribed form, and pay the prescribed fee.

If a company is in receivership or winding up under Part XIII, the receiver or liquidator must file an annual return until winding up is completed.

This provision says section 189 of the principal Act is deleted and replaced with new text.

A company and any officer in default commits an offence if annual returns or other required documents are not lodged correctly, and conviction can lead to a fine of up to 10,000 penalty units.

The principal Act is amended by inserting a new section immediately after section 189.

If a company or officer fails to comply with the Division, the Registrar can give notice, strike the company off the register, or disqualify an officer for five years.

This section amends the principal Act by deleting section 208 and replacing it with new text.

A company registered in Zambia must have at least half of its directors resident in Zambia.

Rules are added for meetings on contracts where a director is interested: the director is excluded from quorum and voting, approval must wait for external audit and verification, and a report must be included in the auditor’s annual report. An interested member, director, or interested party may petition court if a party-related transaction is not in the company’s interest.

This provision amends the principal Act by inserting new sections after section 218.

A third party may disclose conflict-of-interest details when it intends to enter into a transaction with a company.

A company may enter a qualifying transaction only if it is approved by a simple majority of members.

This provision amends the principal Act by deleting section 224 and replacing it with new text.

Companies must keep a directors-and-secretaries register, make it open for inspection, and directors or secretaries must notify the Registrar in writing of necessary matters.

This section amends the principal Act by deleting section 248 and replacing it with new wording.

A foreign company must have at least one local director who is resident in Zambia.

The Registrar must notify the Gazette of a liquidator’s name, business address, and appointment or release details when a liquidator is appointed or released.

An official receiver may order an investigation into a liquidator’s books and vouchers, and may recommend prosecution or disqualification in specified cases.

A liquidator other than the official receiver is entitled to be paid remuneration, but the amount must be determined by agreement, by creditors, or by the court if needed.

This section amends the principal Act to add a requirement that something be done within three months of a liquidator’s appointment.

A liquidator must file a report on the company’s liquidation affairs within six months after receiving the statement of company affairs, unless the court allows more time.

A person who wants to act as a liquidator must apply for accreditation with the Registrar, and the Minister must prescribe the qualifications and certificate process.

A liquidator must act in good faith, avoid secret profits and conflicts of interest, sell company assets transparently, and give the Registrar at least 21 days’ notice before disposal.

This provision amends the principal Act by inserting a new section immediately after section 346.

A liquidator is entitled to a fee based on a percentage of the company’s liquidation proceeds, but the amount cannot exceed any prescribed limit.

The Registrar may re-issue a defunct company’s name, but only after at least five years and when someone applies to register a company with that name.

The Registrar may issue notices under the Act, and must use reasonable steps to ensure they reach the widest possible audience.

Older liquidators and receivers are not covered by these provisions, and pre-existing liquidations or receiverships continue under this Act.