Trending News

Fundamental Human and Economic Rights at Crossroads with the Companies Act, 2019 (Act 992)

Source: Samuel Cudjoe

Fundamental Human and Economic Rights at Crossroads with the Companies Act, 2019 (Act 992)
MarryRight Ghana

Introduction

The fifty-six (56) year regime of the Companies Act, 1963 (Act 179)1 ended in 2019 upon the coming into force of the Companies Act, 2019 (Act 992)2 . Arguably, Act 992 represents a transformative shift in Ghana’s business landscape, representing a monumental development from Act 179. Some of these include the departure from the regulations of a company to the constitution. Act 992 provides that it is not compulsory to incorporate a company with a constitution. It is however, instructive to note that where a company is not incorporated with a constitution, it will be bound by the default constitution as spelt out in the second, third and fourth schedules to Act 992. Another introduction is that a company shall not enter into a major transaction unless the transaction is approved by a special resolution or contingent on approval by special resolution.

A major highlight of this development, particularly in respect of corporate governance, is the enhanced qualification of directors , the replacement of external auditors of companies after engaging for a period of 6(six) years, and the cooling-off period of auditors , amongst others. This paper will focus on two major things. The first is the constitutionality of prohibiting persons from becoming directors of a company upon incorporation and/or rendering them disqualified or unfit to continue in their role as directors of a company merely because they have been charged with an offence relating to fraud or dishonesty. The second is the mandatory cooling-off period ascribed to auditors in the Companies Act, 2019 (Act 992). However, these discussions will be situate within the context of the supremacy of the Constitution and the Supreme Court’s power to review legislation. It is in this vein that I will review the Supreme Court’s recent decision in Derrick Adu Gyamfi v The Attorney-General


Read the full article