Accounability During The Incorporation Of Public And Private Limited Companies Under Ohada Law

International Journal of Research and Innovation in Applied Science (IJRIAS) | Volume VII, Issue I, January 2022 | ISSN 2454–6194

Accounability During The Incorporation Of Public And Private Limited Companies Under Ohada Law

By Merinda Afanui Sama
Ph.D. in English Law 5847
University of Bamenda
HTTTC Bambili

ABSTRACT

This work sets out to evaluate the OHADA Uniform Act’s laws on accountability in
Private and Public Limited Companies. Normally, laws which provide for effective
accountability, guarantee the smooth functioning and stability of companies since its rules work at averting all forms of mismanagements. The inspiration of this work stems from the realization that, levels of accountability in these companies are still wanting. Hitherto, companies are plagued with vices of obscured activities, fake transactions, non-transparent reporting and acute dishonesty by its organs. It is therefore baffling that, these are still prevalent despite the existence of the Uniform Act’s laws which contains accountability mechanism aimed at dispelling all these forms of corporate transgressions. From this arose lingering doubts as to how these laws are.
This leads one to the assumption that, these laws are not efficacious in guaranteeing the
effectiveness of this aspect of corporate governance. What then are these techniques and how
effective are they? This work highlights and analyses these mechanisms and evaluates the extent of their efficacy. We therefore propose that, these mechanisms be reviewed and amended to be more authoritative, unequivocal, specific, realistic and punitive such that, they will ensure better levels of rendering accountability. In consequence, these companies shall flourish, achieve their desired objectives, experience maximum productivity and generate more profit.
INTRODUCTION:
The OHADA uniform Act (OUA) contains several provisions which pass as control mechanisms regulating the affairs of public and private limited companies. These elements are geared towards providing means of rendering accountability. They ensure that avenues for verifying whether company executives have performed their duties or not are available to shareholders and other such authorities of interest. It shall also provide a means by which members of the company and the company itself are accountable for their acts. These mechanisms cannot be complete without consequences provided if not scrupulously followed. Therefore, this article will elaborate on the early stages of the company’s creation.
To wit, accountability is an instrument of controlling the company and its executives. The smaller the company’s power to render proper accountability the bigger the risk of managers only seeking to serve themselves and their interests. Likewise, public and private limited companies being of public interest dictates that the public company as well as some third parties and stakeholders demand a certain degree of accountability from them.
Notwithstanding, our laws have not out rightly established a unified doctrine, as to what accountability consists, it can be extrapolated from various principles of transparency, due financial reporting and compliance with certain efficiency indicators provided in the uniform Acts. It is therefore important that these mechanisms be examined at different stages of the company’s exercise.
1.1 The early stages of the company’s formation
According to the OHADA Uniform Act and under the OHADA law the formation of a company is contained in one document, known as the Article of Association. The English refer to this document as the ‘’Memorandum of Association and Articles of Association ’’. Under the OHADA Uniform Act the memorandum of Association and Articles of Association are the same. The articles of association of companies under OHADA law vary with the type of company . Accordingtolawno.017/011of12July2017governingincorporationofpubliccorporationsinCameroon, chapter II of this law, from sections 10-14,throws more light on the incorporation of public corporations which shall be incorporated as a limited liability company in accordance with the OHADA uniform Act, relating to the law on commercial companies and economic interest groups, as well as the provisions of this law . The shares held by the state, public enterprises and / or regional and local authorities in public corporations shall be registered shares. The shares owned by the state in public corporations shall be held on behalf of the state by the minister in charge of finance. The shares owed by a public enterprise or a regional or local authority in a limited liability company shall be held by executive organs of the public enterprise or local authority concerned. The shares in a public limited liability company jointly owned by the state, public enterprises and/or regional and local authorities shall be held by the organ specified in the Articles of incorporation .
In addition, the managers will be accountable to the public corporation because they owned the property and shares of the company. The managers in the public corporations are accountable to the public enterprise. Property owned by a public limited liability company shall be public property with regards to the accountability of managers. And lastly, section 14 (1-3) states that public; public corporations shall be subject to registration in the Trade and Personal Property Credit Register. Any modifications in the configuration of the management organs, in particular the appointment or designation, resignationordismissalofmanagersshallberegisteredintheTradeandPersonalPropertyCreditRegister. Any amendment to the articles of association well as the transfer of head office shall be advertised according to ordinary law rules. Following sections 125 of this law, this law which reflects the OHADA Uniform Act relating to the law on commercial companies and economic interest groups repeals Law No.99/16of22December1999 on General Rules and Regulations Governing Public Establishments and enterprises of the public and semipublic sector. Most of the provisions of this law applies mutatis mutandis to public and private limited companies.

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