Back to Index
Reconstruction of State-Indebted Insolvent Companies Act [Ch 24:27] [Act
27 of 2004]
97 version (116KB)
PDF version (271KB)
If you do not have the free Acrobat reader on your
computer, download it from the Adobe website by clicking
To provide for the
reconstruction of State-indebted companies and associate companies that
are unable to repay credits made to them from public funds, or in respect
of whose liabilities the State has issued any guarantee that has become
due; to provide for appointment and functions of administrators of companies
under reconstruction; to provide for formulation and implementation of
schemes of reconstruction in respect of such companies; to amend the Prevention
of Corruption Act [Chapter 9:16]; and to provide for matters connected
with or incidental to the foregoing.
ENACTED by the President and the Parliament of Zimbabwe.
[Date of commencement:
25th February, 2005.]
for and scope of reconstruction order.
5. Contents of reconstruction order.
6. Effect of reconstruction order.
7. Transmission of reconstruction order to certain officers.
8. Confirmation of reconstruction order.
Culpable persons in relation to companies under reconstruction
of company's affairs.
10. Identification of culpable persons.
11. Special commissioners for taking evidence.
12. Forfeiture or vesting in State of rights held by culpable persons.
13. Attachment of assets of culpable persons in satisfaction of their
liabilities to company under reconstruction.
14. Powers of administrator in relation to culpable persons.
15. Transactions by culpable persons.
16. Offences by culpable persons.
17. Power of administrator to compromise with persons liable to be prosecuted
or declared culpable.
Functions of Adminstrator in Reconstruction
powers of administrator in relation to company under reconstruction.
19. Application of certain provisions of the Act to reconstruction.
20. Voidable dispositions of property by companies under reconstruction
and culpable persons.
21. Initial meeting of creditors and members.
22 Subsequent meetings of creditors and members.
Schemes of Reconstruction and Interim Management of Reconstructed
of administrator with respect to scheme of reconstruction.
24. Approval of scheme of reconstruction.
25. Consequences where reconstruction not possible or scheme therefor
26. Implementation of scheme of reconstruction and matters incidental
27. Duties of interim board.
Persons employed by company before its reconstruction.
29. Application of assets during reconstruction.
30. Remuneration of administrator and assistant administrators.
31. Liabilities incurred by administrator and interim board to have preference
over pre-reconstruction liabilities.
32. Period of reconstruction excluded in determining preference under
33. Position of auditor during reconstruction.
34. Reconstruction expenses.
35. Cancellation of reconstruction order.
36. Offences consequent upon a reconstruction.
37. Amendment of Cap. 9:16.
38. Saving of powers exercised under Statutory Instrument 187 of 2004.
This Act may be cited as the Reconstruction of State-Indebted Insolvent
Companies Act [Chapter 24:27].
This Act shall apply to all State-indebted companies, including those
formed or incorporated before the date of commencement of this Act and
regardless of when they became indebted to the State:
that if in relation to a State-indebted company there is made or presented
to the court—
an application in terms of section 191 of the Act for the sanctioning
of a compromise or arrangement proposed between the company and its
creditors or members, sections 191 to 194 of the Act; or
(b) a petition for the winding up of the company in terms of section
207 of the Act, Part V or VI of the Act; or
(c) an application for a provisional judicial management order in terms
of section 299 of the Act, Part V or VI of the Act;
apply to such company unless, within thirty days of the date of presentation
of the petition or the making of the application, as the case may be,
the Minister issues a reconstruction order in respect of the company.
(1) In this Act—
Act” means the Companies Act [Chapter 24:03];
means an administrator appointed under section 5(1)(b), and includes any
assistant administrator appointed under that provision;
in relation to—
a company referred to in paragraph (a) of the definition of “company”
or any body or association referred to in paragraph (c) of that definition
which is registered or incorporated in terms of the Act, means—
(i) its subsidiary, as defined in section 143 of the Act; or
(ii) any company of which the company is the single largest shareholder;
(iii) its holding company, as defined in section 143 of the Act; or
(iv) where the company is itself a subsidiary of a holding company,
as defined in section 143 of the Act, any other such subsidiary of
the same holding company; or
(v) any person who has power, directly or indirectly, to control the
company’s management or policies;
an entity referred to in paragraphs (b), (c), (d) or (e) of the definition
of “company”, means any person who has power, directly or
indirectly, to control the entity’s management or policies;
a company registered or incorporated in Zimbabwe or a company, wherever
registered or incorporated, that carries on business in Zimbabwe or
is liable to be wound up under the Act;
(b) a private business corporation;
(c) any body or association incorporated or registered under any law
relating to banking, building societies, co-operative societies, insurance
or pensions or under a special law;
(d) a trust;
(e) a partnership, a syndicate, a club or any other association of persons
which is not a body corporate;
and includes any associate company;
under reconstruction” means a company subjected to a reconstruction
order that has not yet been reconstructed in accordance with a scheme
means any loan, advance or other disbursement of a sum of money in exchange
for a right to repayment of the amount disbursed and to the payment of
interest or other charges on such amount;
person” means any person identified by the administrator as a culpable
person in terms of section 9(1)(b);
any banking institution registered or required to be registered in terms
of the Banking Act [Chapter 24:20]; or
(b) any building society registered or required to be registered in
terms of the Building Societies Act [Chapter 24:02]; or
(c) the People’s Own Savings Bank established in terms of the
People’s Own Savings Bank of Zimbabwe Act [Chapter 24:22]; or
(d) the Reserve Bank of Zimbabwe referred to in section 4 of the Reserve
Bank of Zimbabwe Act [Chapter 22:15]; or
(e) an asset manager as defined in the Asset Management Act [Chapter
(f) a collective investment scheme as defined in section 3 of the Collective
Investment Schemes Act, 1997; or
(g) any person who carries on a business of acceptance of deposits and
other repayable funds from the public;
board” means the board of directors in which the management of a
reconstructed company is vested in terms of section 23(1)(m);
in relation to a company, means—
a shareholder, debenture-holder or other person having a right to vote
at meetings of the company; or
(b) any contributory as defined in section 202 of the Act;
means the Minister of Justice, Legal and Parliamentary Affairs or any
other Minister to whom the President may, from time to time, assign the
administration of this Act;
funds” means funds held by or on behalf of the State (whether or
not appropriated by Act of Parliament) and includes the funds of any statutory
corporation or State-controlled company;
company” means a company that has been reconstructed in accordance
with a scheme of reconstruction, and includes a company formed in succession
to a company under reconstruction that was dissolved;
in relation to a company, means the reconstruction of the company in accordance
with a reconstruction order or a scheme of reconstruction;
order” means a reconstruction order issued in terms of section 4;
Bank of Zimbabwe” means the Reserve Bank of Zimbabwe referred to
in section 4 of the Reserve Bank of Zimbabwe Act [Chapter 24:22];
of reconstruction” means a scheme referred to in section 23;
company” means a company in which the State holds directly the controlling
in relation to a company, means that the company is indebted to the State,
a statutory corporation or State-controlled company by reason of having
received any credit or guarantee in its favour that is disbursed or payable
out of public funds or which imposes any liability upon the State;
corporation” means any body corporate established directly by or
under any Act of Parliament for special purposes specified in that Act.
Any word or expression to which a meaning has been assigned in the Act
shall have the same meaning when used in this Act.
Please credit www.kubatana.net if you make use of material from this website.
This work is licensed under a Creative Commons License unless stated otherwise.