Commercial companies in OHADA member states that were incorporated prior to the entry into force of the Amended Uniform Act on 5 May 2014 must ensure that their articles of incorporation comply with the Act’s provisions by 5 May 2016.
The amended Uniform Act relating to commercial companies and economic interest groups (Amended Uniform Act) entered into force on 5 May 2014, bringing significant improvements to companies’ law applicable in the seventeen member states of the Organization of Harmonization of Business Law in Africa (OHADA). Any commercial company newly incorporated in one of the OHADA member states must comply with the Amended Uniform Act. Companies incorporated prior to the entry into force of the Amended Uniform Act have a two-year grace period to ensure that their articles of incorporation comply with the Amended Uniform Act’s provisions. This two-year period will expire on 5 May 2016.
AMENDING ARTICLES OF INCORPORATION TO COMPLY WITH AMENDED UNIFORM ACT
Commercial companies should thus repeal, change, or replace any provisions of their articles of incorporation that do not comply with the mandatory provisions of the Amended Uniform Act. Commercial companies must also add to their articles of incorporation any mandatory additional information required under the Amended Uniform Act. To comply, commercial companies may either amend their current articles of incorporation or adopt new articles of incorporation.
The amendment of articles of incorporation may be decided by a general shareholders meeting. If no amendment to the articles of incorporation is required to comply with the Amended Uniform Act’s provisions, a general shareholders meeting still has to make a decision to acknowledge that no harmonization is required.
SANCTIONS FOR NONCOMPLIANCE
In the event a harmonization of the articles of incorporation with the Amended Uniform Act is required but is not carried out, two types of sanctions may apply:
- In the event the absence of harmonization relates to the newly set minimum amounts of share capital in the Amended Uniform Act for limited liability companies (“sociétés à responsabilité limitée”) and public limited companies (“sociétés anonymes”), companies whose share capital do not meet the minimum requirements and which do not increase their share capital by 5 May 2016 to comply with such requirements will either have to be dissolved or transformed into another legal form (for which their current share capital is compliant with the minimums provided by the Amended Uniform Act). Otherwise, commercial companies will be dissolved as of right (“de droit”) after 5 May 2016.
- If the absence of harmonization relates to other mandatory provisions of the Amended Uniform Act, noncompliant provisions of the articles of incorporation will be deemed to be null and void, and the new provisions of the Amended Uniform Act will apply.
The Amended Uniform Act, however, provides in its Article 916 that it will apply to companies that are subject to a “specific regime” (“régime particulier”) subject to the legal and regulatory provisions that apply to such companies. The Amended Uniform Act does not define the concept of “specific regime”, and the scope of Article 916 is thus unclear, which is likely to create uncertainty for such companies.