In this Expert Insight, our business advisor in Ghana, Eric Osei, talks us through the relevant rules and regulations for international businesses that want to set up shop in the West African country. He also outlines the 2-step registration process.
In an attempt to enhance the protection of foreign investment interest in the economy, Ghana has joined the Multilateral Investment Guarantee Agency (MIGA) of the World Bank, which "promotes foreign direct investment (FDI) into developing countries" and also "provides investment guarantees against non-commercial risk for investments in developing countries". Ghana has also entered into bilateral Investment Promotion and Protection Agreements (IPPAs) to augment the protection and security of the investment regime.
Successive governments have promoted the cause of investment activities for rapid growth of the Ghanaian economy. Additionally, several agencies and departments have been set up as regulators to advance investment interests. The following are some of the governmental agencies and departments under various ministries which have oversight responsibilities in the area of establishment and registration of businesses, investment promotion, tax obligations, environmental protection, and quality standard of production and granting of work permit to foreign investors.
Business Registration in Ghana
The laws establishing business institutions in Ghana is contained in the following legislation:
The Companies Code, 1963 (Act 179)
The Partnership Act, 1962 (Act 152)
The Business Name Act, 1962 (Act 151)
There are procedures to be followed in the event of incorporating and registering a business in the Ghanaian economy. The following two steps are relevant and identical to the legitimate procedures enforced by the two principal agencies of business and enterprise registration in Ghana.
Step one: Business Registration at Registrar General's Department (RGD)
The preliminary step for an investor intending to do business in Ghana is to register with the Registrar General's Department. The firm is expected to fill out the relevant Application Forms, which serve as the Company's Regulations in the event of a company. It is expected of the firm to engage the services of an auditor who must be independent of the intended business to be registered. The department charges a fee of 0.5% of the company's stated capital. After all the Application Forms have been filled correctly and presented to the office of the Registrar's General department, a Certificate of Incorporation and a Certificate to Commence Business will be issued to the newly registered company. After incorporation, companies that are partly or fully owned by foreigners have to register with the GIPC. Registration is completed after companies have met the minimum equity requirements, depending on their structure. The required equity can be brought into Ghana either in cash or kind (goods, plants and machinery, vehicles or other tangible assets).
Step two: Register with the Ghana Investment Promotion Centre (GIPC)
The Ghana Investment Promotion Centre (GIPC) is responsible for registering all businesses that are partly or fully owned by foreigners in Ghana. After registration with the Registrar General's Department (RGD), companies that are partly or fully owned by foreigners are required to complete Investor Registration Forms (Form GIPC/R1) in triplicate. The official processing of the forms usually takes five days from the date of submission of these forms and their attachments to the GIPC.
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