SESSIONS ON THE UNIFORM ACT ON COMMERCIAL COMPANY AND ECONOMIC GROUP PARTNERSHIP LAW

It has been recalled that the Uniform Act on commercial companies and the economic group partnership has deeply modified the existing company law which dated from as far back as 1807 (French Law of July 24, 1807).

Innovations

Some general trend in this field were first presented, notably :

. the wide range of business structures offered by the new Ohada company law enabling various categories of businessmen to operate/be included in the formal sector,

. the upgrading of governance standards expected to be more transparent and democratic with the strengthening of the shareholder' rights and of the monitoring powers of auditors ( alarm mechanisms and management evaluation procedure),

. the inclusion of a set of consistent, new penal provisions from company incorporation infringements up to their winding-up.

Then have been presented with more details, some of the important innovations among which :

. the possibility of incorporation of sole-holder companies and to set up economic group partnerships;

. the increase of the mimimum amount of the capital stock of companies;

. a limitation in the duration and number of possible appointments as company manager,

. an increased liability on company managers with the possibility of instituting individual proceedings or in the name of the company.

Implementation Problems

It has been underlined that while some of these problems were resulting from some shortcomings or imprecise provisions, others were related to practise and to an unmastered implementation of the harmonized company law, in addition to the overwhelmingly difficult access to relevant information on commercial companies in trade registers the organisational standards of which still lag behind Ohada standards.

- Some examples of shortcomings and implementation problems as to commercial company incorporation

. the question of how actual are the partners' contributions in companies such as private companies,

. the imprecise rules governing the contributions of labour and the contributions in kind,

. the unclear scope of the rules governing public calls for capital.

- Some examples of shortcomings and implementation problems as regards the functioning of commercial company incorporation

. the imprecise limits of powers between the managing bodies of public limited companies,

. the illegal designation of vice-chairmen of boards of directors which may cause some confusion within the management of public limited companies,