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rules for finance and education sectors and 7 other sectors - Bill
July 03, 2012
Rules for Finance and Education Sectors and 7 Other Sectors
In General Notice
[GN] 280/2, gazetted on Friday 29th June, the Minister of Youth
Development, Indigenisation and Empowerment, citing sections 5(4)
and 5A(4) of the Indigenisation and Empowerment (General) Regulations
as amended as its enabling legal framework [Note: the legality of
sections of these regulations has been questioned], lays down rules
for the implementation of indigenisation in the nine sectors outlined
covering “all financial institutions”
4. Arts, Entertainment
and Motor Industry.
to the GN has nine numbered Parts, one for each of the affected
sectors. All but the Finance sector are broken down into sub-sectors.
Each Part lays down in tabular form the following requirements for
the sector or sub-sectors concerned:
- the minimum
net asset value above which a business is required to comply with
the principal regulations [in some cases only $1,00]
- for a few
sub-sectors, a quota for indigenous Zimbabwean shareholding that
is less than 51%
- the maximum
period a business may continue to operate before it attains the
relevant indigenisation and empowerment quota [in all cases this
is set at only 1 year]
There are no
definitions for any of the terms used to describe the sectors or
Like last year’s
GN 114/2011 referring
to mining sector indigenisation, this GN is likely to be criticised
as ultra vires and invalid, void for vagueness, and perhaps unconstitutional
by legal practitioners. It is also likely to attract an adverse
report from the Parliamentary Legal Committee.
It remains to
be seen whether affected businesses will institute court cases test
to the legality of the GN.
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