Zimbabwe waters down Indiginisation Law

The government of Zimbabwe led by Robert Mugabe has gazetted changes in the controversial Indiginization Law despite Mugabe’s threats to tighten the noose and nationalize all non-compliant companies. The new changes state that a heavy levy will be charged on non-compliant companies instead of being forcibly nationalized.

Companies will now have a grace period of up to 5 years with the option to apply for more time of up to 20 years after the expiry of the first five.

Section 21 of the gazette reads, “The 51% equity held by designated entities in the resource-based sectors of the economy may be diluted to the extent of injection of additional capital by foreign shareholders on a pro-rata basis subject to condition that the designated entities shall be entitled to buy new shares in order to restore their shareholding to 51% within a period ranging up to five years, which period may be extended upon application in terms of section 3(a) of the IEE general regulations.”

Pin It

Leave a Reply

Your email address will not be published. Required fields are marked *