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and Economic Empowerment Bill, 2007 (H.B. 6, 2007)
the amended Bill
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This Bill seeks
to create an enabling environment that will result in increased
participation of indigenous people in Zimbabwe in the economic activities
of the country. In order to ensure meaningful participation, the
Bill also makes provision for the establishment of an Indigenisation
and Empowerment Fund to provide finance for the indigenous people
in the acquisition of shares, working capital and other forms of
finance. Ultimately it is intended by this Bill to provide an enabling
environment in which at least a 51% shareholding in the majority
of businesses in all sectors of the economy is in the hands of indigenous
In more detail
the individual clauses of the Bill are as follows—
Clause 1 sets out the Bill’s short title and date of commencement.
Clause 2 defines
the terms used throughout the Bill.
Clause 3 outlines the objectives and measures that the Government
will put in place in order to ensure that its goals and policies
in pursuance of indigenisation will be met. The clause sets out
mandatory indigenous shareholding thresholds of 51% in every business
that is being transferred, merged, restructured, unbundled or demerged
and in any new investments of a prescribed value. Such transactions
must be referred to the Minister for approval, and any transaction
that fails to meet the required minimum shareholding percentage
will not be approved. The Minister will however exercise his or
her discretion and prescribe a lesser percentage depending on the
circumstances of each case subject to a set the time-frame within
which the 51% share or controlling interest must eventually be attained.
Clause 4 gives
the Minister power to review and approve indigenisation arrangements.
This clause requires the Minister to be notified in writing of any
business transaction to which the provisions of this Bill apply
and the Minister will approve or disapprove of the transaction.
The Minister will disapprove the transaction if it does not comply
with the objectives set out in clause 3.
Clause 5 authorises
the Minister to order the licensing authority of any business that
fails to notify the Minister of a transaction affecting its ownership
to cancel the licence, registration or other authority under which
that business operates at the time it comes up for renewal or, if
it was issued indefinitely, within a period of six months from date
of the order. The Minister will give the business concerned sufficient
time to rectify its failure, after which he or she may have the
licence terminated, subject to a right of appeal under Clause 20.
Clause 6 makes
provision for the Minister to assist, upon request by the business
concerned, in identifying potential indigenous persons who will
acquire a controlling interest in the business if the business is
unable to identify suitable persons to partner with as is required
in the Bill.
This Part provides for the establishment and appointment of members
of the National Indigenisation and Economic Empowerment Board.
Clause 7 enumerates
members of the Board who will be appointed by the Minister in consultation
with the President. The Board will consist of not less than eleven
and not more than fifteen members who will be drawn from various
sectors and represent various interest groups. The Secretary for
the Ministry of Indigenisation and Empowerment will also be a member
of the Board.
Clause 8 spells
out the functions of the Board, which include advising the Minister
on appropriate measures to adopt in the implementation of the objectives
and policies on indigenisation. The administration of the Indigenisation
Fund is also vested in the Board.
The Chief Executive
Officer of the Board will be appointed in terms of Clause 9. The
other staff of the Board will also be appointed under this Clause.
The functions and terms of appointment of the Chief Executive Officer
and his or her staff are further provided for in this clause.
The Board is
expected to prepare and submit annual reports on matters the Board
will have dealt with in the previous year. The Minister may require
the Board to submit any other report as the Minister may deem necessary.
The Minister must lay the annual report submitted to him or her
In Clause 11
the Minister is authorised to give the Board general directions
relating to the government’s policy on indigenisation and
This Part establishes the Indigenisation and Economic Empowerment
Fund. The objectives of the Fund which are outlined in Clause 12
are to provide financial assistance to indigenous people so that
they are able to participate meaningfully in various economic endeavours.
National Investment Trust of Zimbabwe will be constituted as a special
account of the National Indigenisation and Economic Empowerment
Fund in terms of Clause 13. The reconstitution will not however
affect the interests of the unit holder, and the Deed of Trust is
incorporated in this Act in the Second Schedule with minor amendments
which are purely consequential and meant to bring the Deed in line
with this Clause. Any other amendments to the Schedule will be done
by the Minister in consultation with the Board and by notice through
a Statutory Instrument.
Clause 14 provides
for the composition of the Fund. The fund will consist of moneys
appropriated by Act of Parliament, levies, approved donations, loans
and other financial assistance and any moneys that may vest in or
accrue to the Fund.
The Board administers
the Fund through its Chief Executive Officer in terms of Clause
15. The Board may open banking accounts into which the moneys of
the Fund will be paid. The Third Schedule provides detailed provisions
governing the administration of the Fund.
Clause 16 provides
for the National Indigenisation and Economic Empowerment Charter.
Beneficiaries of the Fund are expected to conform to the standards
of good and ethical business conduct that are set out in the Charter.
Detailed provisions of the Charter are contained in the Fourth Schedule.
This Part makes provision in Clause 17 for the imposition of levies
on any private or public company and any other business in Zimbabwe.
The minister will by statutory instrument specify the companies
and businesses on whom the levy will be imposed. The draft statutory
instrument is laid by the Minister before Parliament and approved
by resolution of Parliament before it is put into force. All levies
collected must be remitted to the Fund.
Clause 18 penalises
any person who without lawful excuse fails, neglects or refuses
to pay, collect or remit any levy. The maximum level of fine payable
is level six or imprisonment not exceeding one year. The court convicting
the person will also order the person to pay, remit or collect the
levy due in addition to any penalty that it may impose.
This Part provides for general and transitional provisions. Generally,
the Minister may request information regarding the shareholdings
or similar interests of the members of any company or business.
Failure to provide the information requested attracts criminal penalties
not exceeding a fine of level five.
C lause 20 gives
any person aggrieved by a decision of the Minister a right of appeal
to the Administrative Court. However, the person is obliged to comply
with the Minister’s order or directive pending finalisation
of the appeal.
Clause 21 provides
for the regulatory powers of the Minister. The maximum level of
fine payable for any offences under the regulations is level twelve
and alternatively a term of imprisonment not exceeding five years
The assets, rights obligations and liabilities of the National Investment
Trust of Zimbabwe will be transferred to the Unit Trust Account
of the Indigenisation and Economic Empowerment Fund once this Act
comes into effect in terms of Clause 22. Nothing changes in terms
of rights held by unit holders or investors in the National Investment
Trust of Zimbabwe except that the account will be one of the many
accounts of the Fund which will be used as vehicles to support indigenisation
and economic empowerment funding.
Clause 23 provides
for the transfer, with their consent, of every person employed by
the National Investment Trust to the service of the Board. The employees
will continue to enjoy the same conditions of service until such
time that the Board has drawn up new conditions of service, which
must not be less favourable than the conditions before transfer.
1. Short title
and date of commencement.
INDIGENISATION AND ECONOMIC EMPOWERMENT:
GENERAL OBJECTIVES AND MEASURES
and measures in pursuance of indigenisation and economic empowerment.
4. Power of Minister to review and approve indigenisation and empowerment
5. Enforcement of notification requirement.
6. Referral to the Minister of proposed notifiable transactions
in respect of which no counterparties have yet been identified.
ESTABLISHMENT AND FUNCTIONS OF THE NATIONAL INDIGENISATION
AND ECONOMIC EMPOWERMENT BOARD
and appointment of the National Indigenisation and Economic Empowerment
8. Functions of Board.
9. Chief executive officer and staff of Board.
10. Reports of Board.
11. Minister may give Board directions in national interest.
NATIONAL INDIGENISATION AND ECONOMIC EMPOWERMENT FUND
and objects of National Indigenisation and Economic Empowerment
13. Unit Trust Account of National Indigenisation and Economic Empowerment
14. Composition of Fund.
15. Administration of Fund.
16. National Indigenisation and Economic Empowerment Charter.
18. Failure to pay, collect or remit levies.
GENERAL AND TRANSITIONAL
may request information
22. Transfer of assets, obligations, etc. of National Investment
Trust to Fund.
23. Transfer of employees of National Investment Trust to Board
and conditions of service of transferred employees
FIRST SCHEDULE: Provisions applicable to the Board and committees.
SECOND SCHEDULE: Rules of the Unit Trust Account of the Fund.
THIRD SCHEDULE: Provisions Applicable to the Administration of the
FOURTH SCHEDULE: National Indigenisation and Economic Empowerment
To provide for
support measures for the further indigenisation of the economy;
to provide for support measures for the economic empowerment of
indigenous Zimbabweans; to provide for the establishment of the
National Indigenisation and Economic Empowerment Board and its functions
and management; to provide for the establishment of the National
Indigenisation and Economic Empowerment Fund; to provide for the
National Indigenisation and Empowerment Charter; and to provide
for matters connected with or incidental to the foregoing.
the President and the Parliament of Zimbabwe.
1 Short title
and date of commencement
(1) This Act may be cited as the Indigenisation and Economic Empowerment
Act [Chapter ].
(2) This Act shall come into operation on a date to be fixed by
the President by statutory instrument.
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