Q&A – 9 May 2016
Merger control, FCC operations grounded
Our company is offloading a property to another company. It is just a small property and no other assets are being sold. Obviously our turnovers are higher than the small turnover mentioned in the Fair Competition Act and its rules. Do we need to apply for merger clearance? How long does this clearance take?
JH, Dar
The answer is unfortunately yes. Since you meet the threshold, which is very low we agree, and since the disposal is that of an asset, you need to apply for clerance of this merger under section 11 of the Fair Competition Act (FCA). Under the FCA, merger is defined very widely as an acquisition of shares, a business or other assets, whether inside or outside Tanzania, resulting in the change of control of a business, part of a business or an asset of a business in Tanzania.
The asset you are selling results in a change of control of that asset making it a notifiable transaction. As to how long it takes, the FCC has thus far been very efficient although in the last 4 to 5 months the FCC has no commissioners to form a quorum and some large transactions have come to a standstill. Unfortunately the appointment of such commissioners has not been forthcoming despite pleas to the Ministry of Industry and Trade, resulting in all transactions on hold in Tanzania much to the shock of the business community.
Extension in Court of Appeal
Is it allowed to apply for extension of time at the Court of Appeal? What are the best reasons for seeking such extension? Does it have to go for a full bench hearing?
TR, Dar
You can apply for extension of time to lodge an appeal or revision at the Court of Appeal. One of the most solid grounds to seek and get such extension is the plea of illegality. So long as you can convince the justice of appeal that there was a serious illegality in the lower Court’s decision, there is a good chance that you will get the extension. Other grounds include not being aware of a decision having been passed against you, having travelled and been unaware, delay beyond your control amongst others.
The hearing of such an application is conducted before a single justice. Rule 28 of the Court of Appeal rules states that a single Justice may exercise any power vested in the Court, which does not involve the decision of an appeal, revision, reference, review or any other proceeding whose determination requires the full Court, but if any Justice rejects any application for the exercise of the power, the person making that application shall be entitled to have his application determined by the Court.
Ex boyfriend obstructs marriage
In a wedding ceremony that was going on, my ex boyfriend showed up and shouted that I was already married to him. He produced a fake document. My to be husband walked out right before the signing and I am single todate. Does the law not protect me against such people?
IR, Moshi
Section 158 of the Law of Marriage Act states that (1) any person who unlawfully attempts to prevent parties to an intended marriage to get married shall be guilty of an offence.
(2) Any person who with the intention to disturb or delay the celebration of any marriage, or with the intention of embarrassing the intended parties or any other person present at the place where a marriage ceremony is being, or is about to be, or has been, performed, causes a disturbance in, at or near such place shall be guilty of an offence.
(3) Any person guilty of an offence under this section shall be liable on conviction to a fine not exceeding two thousand shillings or to imprisonment for a term not exceeding three months or both.
You can see that what your ex did was an offence and it can lead to a fine or imprisonment or both. You can hence proceed to report him and the authorities should take appropriate action.
Annual general meeting of company
What does the law say about holding a AGM? Is it compulsory to have it every year and what happens if the company does not comply? I am a shareholder and another former shareholder still attends meetings whilst he sold his shares to me.
RE, Dar
Section 86 of the Companies Act states that if any person falsely and deceitfully impersonates any owner of any share or interest in any company, or of any share warrant or coupon, issued in pursuance of this Act, and thereby obtains or endeavours to obtain any such share or interest or share warrant or coupon, or receives or endeavours to receive any money due to any such owner, as if the offender were the true and lawful owner, he shall be guilty of an offence, and shall on conviction thereof be liable to imprisonment or to a fine or both.
It is therefore an offence for the former shareholder to pretend he is the current shareholder and he can be imprisoned for doing so.
Section 133 of the Companies Act also provides on how often such AGMs should be held. It states that every company shall in each year hold a general meeting as its annual general meeting in addition to any other meetings in that year,and shall specify the meeting as such in the notices calling it. At the annual general meeting, the company shall, wherever practicable and subject to the provisions of this Act, transact the following business: (a) to have laid before the members the annual accounts; (b) to have laid before the members the directors’ report; (c) to have laid before the members the auditors’ report; (d) the appointment of auditors for the period up till the next general meeting at which accounts are laid; (e) the re-election of any directors retiring and seeking re-election in accordance with any requirement in the company’s articles of association; (f) the election or confirmation of appointment of any directors in accordance with any requirement in the company’s articles of association. (2) So long as a company holds its first annual general meeting within eighteen months of its incorporation, it need not hold it in the year of its incorporation or in the following year.