The Office of the Registrar of Companies (ORC) has vowed to clamp down on businesses and entities on its books who have not renewed their registration with the office.
This is in compliance with section 5A (2) of the Registration of Business Name Act 1992(Act151) on annual renewals which states that “without prejudice to any other liability prescribed by this Act, a registration which is not renewed in accordance with this section shall lapse and the Registrar may remove from the Register the Business Name of the person whose Registration has lapsed after the expiration of the period prescribed for the renewal”.
Explaining the exercise in a statement and copied to the Business and Financial Times (B&FT), the Registrar of Companies, Jemima Mamaa Oware, said failure to renew a business name including sole proprietorship and subsidiary business name for a period of three months after the year has ended from this year would lead to the lapse of said name.
To avoid such business names falling into the public domain and for anyone of interest to use it after it has been struck off the Business Names Register of the ORC, Mrs. Oware urged business name owners whose registrations had elapsed to as a matter of urgency have those names renewed.
Again, the OCR will for the very first time from June 1, 2023, commence the full implementation of section 126(7) of the Companies Act, 2019(Act992) which states that: “Where a Company defaults in complying with the filing of Annual Returns and Financial Statements, the Company and every officer of the company that is in default is liable to pay to the Registrar an Administrative Penalty of Twenty-Five penalty units for each day during which the default continues.”
A penalty unit is established by the Fines (Penalty Units) Act 2000 (Act 572) and the current monetary value per penalty unit is GH¢12.00.
“This means that effective June 1, 2023, an administrative charge of GH¢300.00 would be charged for each day the default continues against the Company and EVERY OFFICER of the Company until section 126 (7) is complied with,” Mrs. Oware stated.
“The full implementation of the Companies Act, 2019 Act 992 by this section is being proposed now by Management and the Board to ensure Companies take the compliance of this requirement in the Act more seriously than they have done previously. Company Secretaries and Auditors should therefore kick start the processes in getting these mandatory documents ready and on time to avoid paying this very punitive Administrative Penalty and sanction and push their Companies into a state of inactivity,” she added.
The ORC from June 2023 is also going to fully enforce the penalty for failure to comply with the statutory provision on Annual Renewal of Partnerships registration in accordance with the Incorporated Private Partnerships Act,1962 (Act 152) section 8.
“Partnerships, especially Auditing Firms on the Register, are to note accordingly and put their Books in order to renew the Partnership Registration and avoid paying this punitive penalty,” she said.
Meanwhile, close to 500,000 companies are said to be operating illegally in the country for not renewing their existence with the ORC.
President Akufo-Addo launched the ORC last year after a 15-year wait with the hope that the Office would take charge of the administration and the registration of companies in the country.
The vacuum created by the absence of the ORC contributed to the weak system of supervision of companies in the country, therefore, its setting up was expected to bring dynamism to the business environment.