Introduction
In our last article, we focused on the pre-incorporation stage of registering a company limited by shares and discussed the things that must be done before a company starts filling out the relevant paperwork to be submitted at the Registrar-General’s Department (RGD). These include conducting a name search, appointing Directors, a Company Secretary and an Auditor, and deciding whether to adopt a Standard Constitution provided by RGD or draft a unique Constitution. In this second part of our three-part article series, we will move on to discuss the incorporation stage of registering a company limited by shares. We will address the following:
Required Forms
In the past, one had to purchase incorporation forms from the RGD office. However, all the forms are now conveniently accessible on RGD’s website. To make it even easier, RGD has created folders based on company type that contain all the relevant forms that must be completed for incorporating that company type. So, to incorporate a company limited by shares, one must simply go on the RGD website, find the “company limited by shares” section, and download the appropriate packet for the specific type of company one is trying to register (i.e. private limited by shares or public limited by shares). The following forms must be completed and submitted to the RGD to register a private company limited by shares:
A company must report their authorized shares and issued shares as well as their stated capital. Authorized shares refer to the total number of shares that the company is permitted by its Constitution to issue. Issued shares are the total number of shares which have actually been given out by the company. Stated capital refers to the total paid-up value in cash and kind of a company’s issued shares.
· Consent Forms (Form 26A and 26B) - The Directors must each fill and sign consent form 26A and the Company Secretary must fill and sign consent form 26B. These forms confirm that they agree to take on the positions and duties for which they have been appointed.
Generally, a person who has direct or indirect interest of 20% or greater in a company must be registered as a BO. Companies in sectors that are considered high risk, like banking and financial institutions, real estate companies, gaming and betting companies and used car dealership companies, must report anyone with 5% or more control or interest. Companies in the extractive industry must report all BOs regardless of the percentage of their interest. If a foreign politically exposed person has an interest of 5% or greater in any company, regardless of the sector, they must be reported as a BO of that company. For a domestic politically exposed person, there is no percentage threshold and any shares or any form of control over a company in any sector must be registered.
If a company has BOs, it has to fill other forms in addition to the BO1 declaration form. The additional form it fills depends on whether the BO is a natural person (BO2), a publicly listed company (BO3) or a government owned company (BO4). You can read more about the Beneficial Ownership requirements in our previous articleon this topic.
· Constitution - If the company opts to have a unique “Registered Constitution” instead of RGD’s “Standard Constitution,” they must submit the constitution to the RGD to be reviewed to ensure that it contains certain regulations. If the company opts for RGD’s Standard Constitution, they simply have to check the “Standard Constitution” box on the first page of Form 3 and RGD will present them with a copy of the appropriate constitution at the end of the incorporation process.
Submission Process
Once the necessary forms have been prepared, you must go to the RGD to submit the application documents. At RGD, you will be required to get a ticket at the entrance and will be directed to the appropriate window to wait until the number on your ticket is called. We strongly advise that you go early to avoid a long wait. When your number is called, you will give your application documents to the Company Inspector who will vet your documents to confirm that everything is in order or instruct on changes that have to be made. If everything is in order, you will be required to pay the prescribed fees at the in-house bank. Thereafter, your application documents will be passed on to the data entry team for the information to be captured in the system.
Costs Involved
As of March 2021, the official costs involved in the incorporation of a company limited by shares are as follows:
Conclusion
Once the application documents have been successfully submitted, it typically takes about two to three weeks for RGD to process the application. At the end of the process, RGD will present you with a Certificate of Incorporation and a copy of the Constitution by which the company must operate. This concludes the incorporation phase of registering a company limited by shares however, the company is still not a validly existing entity at this point. The company must register with the Social Security and National Insurance Trust (SSNIT), Ghana Revenue Authority (GRA), District Assembly, Ghana Investment Promotion Centre (GIPC) if necessary, Data Protection Agency, and industry specific licenses. These additional registrations will be the subject of the third and final part of this article series.