Tanzania is the most well-known country in Africa for many reasons; among them, the country has become synonymous with the Serengeti, Mount Kilimanjaro, and the Islands of Zanzibar. It is also a growing business Centre in Africa, renowned for its natural resources, ports, agriculture for export and high demand for imported goods. It has become one of the first choices for companies looking to expand their commercial activities into Africa. The first step to succeed in Tanzania is registering the vehicle for your business. This article will discuss one type of vehicle: a private company limited by shares.
Dar Es Salaam City | by Peter Mitchell
Companies are the most common vehicle of choice for most businesses because once incorporated; the business becomes a legal entity, separate from its owners; it becomes a ‘person’ in the eyes of the law. The company is entirely independent of its owners concerning finances, liabilities, contractual agreements, and ownership of property and assets.
By way of description, in a company limited by shares, the liability of members is limited to the amount unpaid on the shares. A Private Limited Company requires at least two directors and a maximum of 50, limiting the number of shareholders to 50.
Requirements for company registration in Tanzania
Five essential pieces of information are required when registering a company in Tanzania.
- Company name – should not be similar to an already registered company, or which is so similar to any such character as to be likely to deceive, is likely to mislead the public, is indecent or likely to offend any person or class of persons, suggests the patronage of the Government or some other authority or organisation unless the consent thereof has been obtained, is undesirable for any other reason.
- Director’s Information – Name(s) and surname as shown on government-issued identity documents, national identity number/passport number, official address and a valid Tax Registration Number.
- Shareholders’ information includes the name(s) and surname shown on government issued identity documents and official addresses. This information is also shown in the Memorandum and Articles of Association.
- Company objectives; these are the commercial activities the company intends to carry out. A company can have as many company objectives as they require.
- The address of the principal place of the business.
Procedure for company registration in Tanzania
Essential steps to the company registration procedure in Tanzania include:
- Name Search and reservation
Which can be accomplished within 24 hours and the business has the approved name reserved. - Appointment of company directors
When formulating a company, the promotor(s) should have a list of the intended directors. The company shareholders can as well act as directors. A director should be of the age of majority. The individual must also not have been previously disqualified from acting as a director or bankrupt. - Appointment of company secretary(s)
This is done through specified form. A Company Secretary (CS) should also be of the age of majority. The client must appoint their CS per Tanzanian law for incorporation purposes. It is advised that the person be conversant with the law generally and the rules governing companies in Tanzania and their duties as CS. - Memorandum and Articles of Association
The memorandum is a document that sets up a company, and the Articles of Association set out how the company is run, governed and owned. The memorandum contains the names of all the subscribers (first shareholders) who are at the company’s inception. - Registering of company addresses
The addresses should be a physical address, a Tanzanian address, a postal address, telephone contacts and an email address. - Company incorporation
The official company registration documents are submitted online to Business
Registration and Licensing Agency (BRELA) for incorporation.
Proof of registration
The documents to evidence proof of registration differs depending on the type of business entitythat was registered/ chosen; however, for a company, the authority will issue a Certificate of Incorporation – a legal document issued by the Registrar of Companies showing that your company has been incorporated.
Corporate matters after company registration in Tanzania
After company registration, the company is required to hold its first board meeting to document or resolve initial corporate secretarial issues, including:
- Opening a bank account (subject to fulfilling the bank’s compliance requirements)
- Appointment of a chairperson of the board
- Selection of the company’s auditors
- Selection of the company’s bankers
- Deciding on the company’s accounting reference date
