Written by Last Updated on June 19, 2019
Article 211 of the Companies Act, concerning the private exempt company, has been amended to the effect that the condition that a body corporate shall not hold, or have interest in, any shares or debentures of the company for a company to be able to qualify for the status of exempt company has been removed.
This means that the shareholding of a private exempt company may include any type of body corporate, including foreign entities, provided that the other conditions mentioned in article 211 are satisfied.
Sub-article (2) of the said article 211 now reads as follows.
(2) The conditions required by sub-article (1) are –
(a) that the number of persons holding debentures of the company is not more than fifty; and
(b) that no body corporate is a director of the company, and neither the company nor any of the directors is party or an arrangement whereby the policy of the company is capable of being determined by persons other than the directors, members or debentures holders thereof.
Company practitioners are urged to review their standard Memorandum and Articles of Association in order to take into account the above-mentioned amendment.