The Companies Act of 2000 will be repealed for clearer provisions and faster procedures. Recently the consultant who drafted the new Bill, Warrington Consultancy from Canada submitted an inception report to the economic affairs ministry.
The ministry’s legal officer said, the Bill aims to streamline document-submission to different agencies under the present procedures and also online services of the G2C will start.
The legal officer said “the present Act is vague and needs further clarifications”.
The new Bill will have nine rules and regulations excluding the Corporate Bond Regulation which was put in place this year.
The rules and regulations include appointment of Directors; appointment and qualification of the Company Secretaries; company’s payment of fees; Appointment of Auditors Regulation; company official remuneration; company’s agent appointment; Alteration of articles regulation; merger and acquisition regulation and winding up regulation.
This is done to lay down clear procedures to implement the provisions of the Companies Act and the ministry will pass the rules once the Act is passed by Parliament.
Other major changes in the Act would be, to remove Schedule XIII and XIV which talks about the minimum auditing requirement. The auditing standards will be adopted from the Accounting and Auditing Standard Board of Bhutan.
The procedures to start and close a company will also be clarified. Under it, the roles of company officials including the board members, directors, manager, shareholders and others will also be clarified.
The institutional structure of the Company Registry Division under the ministry will be observed in terms of, need to include more officers to fully function.
“By the 11th Five Year Plan, we will have eight to nine officers mostly qualified in business and law,” said the economic affairs legal officer.
He said the draft Bill which should be ready by October, would probably be tabled during the 11th session of Parliament.
The Companies Act of 2000 came into existence when the same Act of 1989 was repealed.