COMPANY LAW UPDATE: KEEPING AND MAINTENANCE OF COMPANY’S DOCUMENTS IN TANZANIA

• A look into the mandatory and necessary documents kept by a company
• Company’s Officials tasked with the statutory duty to manage certain documents
• Consequences of tampering with the company’s documents

1. Introduction
   Companies are legally required to keep and maintain a number of statutory registers and accounting records. These statutory registers and accounting records are required to be accurate, up to date. Some of the company’s documents are required to be made available for public inspection at the company’s registry (Business Registration and Licensing Authority) or at the company’s registered office.

   Currently, there is a shift towards maintaining documents in non-print form by companies. The Business Registration and Licensing Agency (BRELA) now provides for E-services through its Online Registration System (ORS). All registered users of the ORS deal with electronic documents which are regarded as the official version. However, ORS system does not relinquish companies from the duty to maintain certain documents.

   In this company law update, Breakthrough Attorneys through its corporate department provides a highlight on the companies’ statutory requirement to keep company’s documents.

2. Company’s officials tasked with statutory duty to manage certain documents
   The Companies Act No. 12 RE 2002(hereinafter referred to as “the Companies Act”) does not specifically state who exactly is entrusted to keep the company’s documents. In general, company’s principal officers such as Managing Director, Head of Operations are required to be able to produce certain documents required to be at the registered office of the company when they are required. The Company Secretary as well is liable on certain items which by law are to be in his custody.

   For example, Section 115 of the Companies Act requires for the register of members of the company to be kept at the registered office of the company. Essentially, the Company Secretary and other company officials are vested with the duty to keep company’s documents. Other documents to be kept are listed extensively in paragraph 3.0 below.

   Directors of the Company are also liable persons under the law since they are accountable officers. Even though they are not mainly in charge of day to day activities of the company, they have a duty to ensure that such affairs are in order and a strict liability to the regulators if such affairs are in disarray.

   Notwithstanding the above, the Companies Act under Section 455 has entrusted the Registrar of Companies as well with the duty to keep company’s records.

3. Documents ought to be kept by a company

   3.1  Statutory documents under the Companies Act

   Type of Document	Provision of the Companies Act
   a)Register of share certificates	As per section 85
   b)Register of debenture holders	As per section 88
   c)Copies of instruments creating charges	As per section 107
   d)Register of charges	As per section 108
   e)Register of members	As per section 115
   f)Index of members (Where a company has more than 50 members)	As per section 116
   g) A branch register of company members in a foreign country (Where a company has share capital and is authorized by the Articles of Association to do so)	As per section 124
   h)Minute books of proceedings of general meetings of company and director’s meetings	As per section 148
   i) Records of written resolutions agreed upon at general meetings	As per section 149
   j)  Books of accounts disclosing financial position of the company (either in English or Swahili). The retention period is six years [section 151(4)]	As per section 151
   k)Group accounts (Where a company is a parent company with subsidiaries)	As per section 155
   l) Directors’ reports on development of the business of the company	As per section 159
   m)Auditor’s report on annual accounts of the company	As per section 161
   n)Register of directors’ shareholdings	As per section 205
   o)Register of directors and secretaries of the company	As per section 210
   p) Service contracts of directors	As per section 211

   3.2    Other Company secretarial documents

   These include:

   1. Attendance Registers for meetings of the Board of directors, general meeting, Committees and managerial meetings.
   2. Register of directors and key managerial personnel.
   3. Memorandum and Articles of Association.
   4. Annual Returns.

   
   3.3    Financial records

   The Income Tax Act RE 2008 requires companies to pay corporate tax and submit to Tanzania Revenue Authority (TRA) a statement of tax returns which declares the estimated income and tax payable or the final income and tax payable for each year of income. Thus, a company needs to keep financial records together with tax records in order to meet requirements of TRA.

   Financial records to be kept by the company include:

   1. Tax records
   2. Cash book
   3. Bank statements
   4. Purchase invoices
   5. Sales invoices
   6. Receipts of payments
   7. Payroll for employees

   
   3.4   Contracts and Agreements

   These include:

   1. Employment contracts
   2. Contracts with customers
   3. Service contracts
   4. Shareholder Agreements
   5. Lease Agreements
   6. Partnership deeds

   
   3.5     Permits and licenses

   These include:

   1. Business licenses
   2. Certificates of registration
   3. Tax certificates (For VAT and TIN registration)
   4. Professional certificates (Where a company/firm is engaged in provision of professional services)
   5. Occupational Health and Safety Certificates (if applicable)
   6. Certificate of conformity with the Tanzania Bureau of Standards (if applicable)
   7. Food Safety Certificate (For companies dealing with packaging, storage and sale of food)
   8. Fire Safety Certificate
   9. Certificates of registration with social security schemes
   10. Any other sectoral license depending with the nature of the business run by the company

   
   3.6 Statutory Documents under Labour Laws

   The Employment and Labour Relations Act No. 6 of 2004 (hereinafter referred to as “the Employment and Labour Relations Act”) places a requirement for companies to keep documents of the company itself and their employees regarding employment and labour related issues. The table below stipulates such documents or records together with the specific provision of the Employment and Labour Relations At.

   Type of Document	Provisions of the Employment and Labour Relations Act
   Books and records of the Company’s income, expenditure, assets and liabilities	As per section 51
   Record of written particulars regarding employee’s; (i) Name, age, permanent address and sex of the employee (ii)Place of recruitment (iii)Job description (iv)  Date of commencement (v)  Form and duration of the contract (vi) Place of work (vii) Hours of work The retention period is  five years after the termination of that employee [Section 96 (2)]	As per section 15(5) and 96 (1) (a)
   Record of remuneration paid to the employees the method of its calculation and details of any benefits or payments in kind The retention period is  five years after the termination of that employee [Section 96 (2)]	As per section 96 (1) (b)
   Records of the prescribed details of any strike, lockout or protest action involving its employees	As per section 96 (3)

    

4. Consequences of Tampering with Company Documents
   The law prohibits officers of the company from destroying documents that are related to the company’s property or affairs. Any officer of the company who undertakes to destroy, mutilate, falsify or is privy to the destruction, mutilation and falsification of documents relating to company affairs (Section 226(1) of the Companies Act).

   From this provision, the liability on destruction of company documents not only applies to officers who directly destroy or falsify documents but even to those who are privy in any way to the destruction, mutilation or falsification.

   An officer who destroys, mutilates, falsifies or is privy to the same shall be guilty of an offence unless he proves that he had no intention to conceal the state of affairs of the company or defeat the law. Any person found to be guilty of an offence of destroying or falsifying company documents shall be liable to imprisonment or a fine or both. For the purposes of section 226 of the Companies Act, ”document” includes information recorded in any form

5. Conclusion

   Keeping and maintenance of the company’s documents is a requirement of the law. Likewise, when the company intends to destroy the document, the process must be done in accordance with the law in terms of the time to keep such documents before destroying them and the manner of destroying the same.

 

Important notice

This publication has been prepared for information purposes only, and it does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, Breakthrough Attorneys, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.