Trade And Investment in Ghana

Setting Up Business in Ghana
Notice to Prospective Investors

An entrepreneur, irrespective of nationality, can set up a business enterprise in Ghana in accordance with the provisions of any of the following legal instruments:- The Companies Code, 1963 (Act 179); the Partnership Act, 192 (Act 152) and the Business Name Act, 1962 (Act 151).

A foreign investor may team up with a Ghanaian entrepreneur or company for a joint venture, usually in the form of a partnership or a limited liability company. However, under the Ghana Investment Promotion Centre Act, 1994 (Act 478), a minimum equity capital of US$10,000 is required from any foreign investor who intends to enter into a joint venture partnership with a Ghanaian. The foreign shareholder is required to satisfy this minimum equity capital either in cash transferred through Ghana's banking system or its equivalent in the form of goods, plant and machinery, vehicles or other tangible assets imported specially and exclusively to establish the enterprise.

Foreigners are permitted 100-per-cent ownership of an enterprise provided he/she satisfies section 19 (2b) of the GIPC Act, 1994 (Act 478). Wholly foreign-owned enterprises must have a paid-up capital the must have a paid-up capital the

Application for registration of a company is made directly, or through agents or solicitors, to the registrar-general. A company is duly registered after the company’s regulations have been submitted to the registrar of companies and a certificate of incorporation issued. A specified fee is paid on presentation of the regulations. The information required includes the name of the company with the word “Limited” as the last word in the name; the nature of the company’s business; names of the directors of the company and the shares capital and its division into shares of no par value.

External Companies

An external company is a body corporate formed outside Ghana but which has an established place of business in Ghana. This can take the form of a branch, management, share, transfer, registration office, factory, mine or other fixed place of business, but does not include an agency unless the agent is authorised to negotiate and conclude contracts on behalf of the outside company.

Within one month of the establishment of the place of business, the external company should deliver to the registrar of companies the following: an English language translation of a certified copy of the charter, statutes, regulations, memorandum and articles or other instrument constituting or defining the constitution of the company; nature of business or main objects; name, address and business occupation of the local manager authorised to manage the business in Ghana; number of authorised shares, amount paid and what is remaining payable in cash or otherwise and address of its registered or principal office in the country of its incorporation; address including post office box number of its principal place of business in Ghana; name and address in Ghana of a person authorised by the company to accept service of process and other documents on its behalf, particulars and copies of any charges on the property of the company or if no such charges, then statement to that effect.

On receipt of the documents, they are registered in the Register of External Companies and the particulars gazetted.

An external company may invite the Ghanaian public to subscribe to its shares, subject to its complying with requirements of the Companies Code concerning invitations and the prospectus as if it were a Ghanaian company. The registrar, however, has the discretion to waive or modify parts of these requirements.

Annually, or at intervals not exceeding 15 months, the external company must submit for registration, a profit-and-loss account and balance sheet (as in the limited liability return of accounts).

Alterations made in the charter, statutes, regulations, articles or other instruments used in registration should be delivered to the registhould be delivered to the registeffective date of the alteration.

Free Zones — Incentives

To implement the government's policy of attracting investments, the following incentives have been provided under the Free Zones Act 404 1995.

Duties

100% exemption from payment of direct and indirect duties and levies on all imports for production, and export from the free zones.

Taxation

  • Free-Zone enterprises are granted 100% exemption from income tax on profits for 10 years, after which the tax rate shall not exceed 8%.
  • Relief from double taxation for foreign investors and employees

Customs Incentives

No import licensing requirements, with minimal customs formalities.

Zone Ownership

100% ownership of shares by investor (foreign or national) in a free-zone enclave and enterprise.

Capital/Profit Repatriation

  • No conditions or restrictions on repatriation of dividends or net profit;
  • No conditions or restrictions on payments for foreign-loan servicing;
  • No payments of fees and charges for technology transfer agreements;
  • No conditions or restrictions on the remittance of proceeds from the sale of any interest in a free-zone investment.

Management of Foreign Currency

Free-zone investors are permitted to operate foreign currency accounts with banks in Ghana.

Sales to Local Market

Up to 30% of annual production of goods and services of a free-zone enterprise are authorised for sale in the local market.

Investment Guarantees

Free-zone investments are guaranteed against nationalisation and expropriation.

Trade and Investment

The thrust of the Government’s policy directive is on:

  • A liberalised trade (import/export) regime within the spirit and principles of the World Trade Organisation (WTO).
  • Liberalised investment regime sustained by a targeted investment drive;
  • An export oriented, value-addition industrial development strategy;
  • Free zone development encompassing:-
    • f and export processing zones (EPZ)
    • liberalised skies
    • free ports

Investment Procedures

Under the Ghana Investment Promotion Centre Act, 1994 (Act 478), investment projects in all sectors of the economy, other than the mining and petroleum sectors, can be established without prior approval of GIPC. Mining and petroleum sector projects have to be approved or licensed by the Minerals Commission and the Ghana National Petroleum Corporation, respectively. All investors intending to invest in Ghana should first register as business entities (limited liability company, partnership, sole proprietorship, etc.) with the Registrar-General’s Department under the relevant laws.

Enterprises with foreign participation i.e, joint ventures and wholly foreign-owned enterprises, must complete application forms from the GIPC (Ghana Investment Promotion Centre) for the purposes of registering the actual minimum foreign capital requirement (as evidenced by bank transfers in the case of cash transfers) and customs entry forms for investment goods. GIPC has five working days to complete this formality if registration documents are received in good order. Wholly Ghanaian-owned enterprises do not need to register with GIPC since the minimum foreign capital requirement does not apply to such enterprises. All wholly Ghanaian-owned enterprises and enterprises with foreign participation seeking immigrant quota facilities in respect of expatriate personnel (expert) for their business should satisfy the relevant minimum capital requirements specified under section 30 of Act 478.

Enterprises seeking exemption from import duties and related charges should send invoices for clearance directly to CEPS, which will automatically clear all such investment capital goods and parts thereof as zero-rated (duty free) in their tariff code. A list of all such zero-rated investment capital goods and parts thereof is available at GIPC. In addition, all enterprises must deal directly with the Internal Revenue Service with respect to the enjoyment of tax incentives in relation to their investments. A list of such investment-related tax incentives is available at GIPC.

GIPC assists all enterprises in their dealings with government officials, providing advice as well as serving as a facilitator to ensure unimpeded establishment and operation of business in Ghana.

Notice to Prospective Investors

Ghana is an ideal location to do business and all prospective investors are welcome and, are indeed given the necessary assistance to establish and operate their business.

For the avoidance of doubt, all prospective investors and foreign business collaborators are hereby advised to, in the first instance, deal with the under-listed official channels in exploring business opportunities and/or establishing operations in Ghana.

  1. For information on investment opportunities, registration of projects involving foreign participation, and general investment:
    The Chief Executive, Ghana Investment Promotion Centre, P.O. Box M193, Accra
    Tel: 233 (21) 665125-9, Fax: 233 (21) 663801, E-mail address: gipc@ghana.com
  2. For export business especially in non-traditional export sector:
    The Chief Executive, Ghana Export Promotion Council, P.O. Box M146, Accra
    Tel: 233 (21) 228813 or 228830, Fax: 233 (21) 668263 or 233725, E-mail address: gfzb@hclssified.com
  3. For investment and trade in Ghana’s Free Zones:
    The Executive Secretary, Ghana Free Zones Board, P.O. Box M47, Ministrnes Board, P.O. Box M47, Ministr 780532-5, Fax: 233 (21) 780536, E-mail address: gfzb@hclssified.com
  4. For the verification of authenticity and rating of business in Ghana:
    The Registrar-General, Registrar General Department, P.O. Box 118, Accra
    Tel: 22 (21) 664691, Fax 662043
  5. For stock Market Operations:
    The Managing Director, Ghana Stock Exchange, Cedi House, Liberia Road, P.O. Box 1894, Accra
    Tel: 233 (21) 669908/669914/66935, Fax: 233 (21) 669913. E-mail address: stockex@ncs.com.gh
  6. For mining concessions and operations:
    The Managing Director, Mineral Commission, P.O. Box M248, Accra
    Tel: 233 (21) 772783, Fax: 233 (21) 773324. E-mail address: minicon@ncs.com.gh
  7. For the purchase of gold/diamonds:
    The Managing Director, Precious Mineral Marketing Company, P.O. Box M108, Accra
    Tel: 233 (21) 664931-4, Fax 233 (21) 662586
  8. For wood and wood products:
    The Executive Secretary mber Export Development Board (TEDB), P.O. Box 515, Takoradi
    Tel: 233 (31) 22921-3, Fax: 233 (31) 23339
  9. For cocoa and cocoa products:
    The Executive Secretary, Ghana Cocoa Board, P.O. Box 933, Accra
    Tel: 233 (21) 221212, Fax: 233 (21) 667104
  10. For divestiture of State Owned Enterprises (SOE):
    The Executive Secretary, Divesture and Implementation Committee, P.O. Box C102, Cantonments, Accra
    Tel: 233 (21) 772049, 773119, 760281, Fax 233 (21) 773126, E-mail address: dic@gh.com
  11. For trade exposition:
    Ghana International Trade Fair Limited, P.O. Box 111, Trade Fair Centre, Accra
    Tel: 233 (21) 776611-5, 772376, Fax: 233 (21) 772012, E-mail address: stfc@ghmail.com
  12. For Business Associations:
    1. The President, Ghana National Chamber of Commerce, P National Chamber of Commerce, P 233 (21) 662427, Fax: 233 (21) 662210
    2. The Chief Executive, Ghana Chamber of Mines, P.O. Box 991, Accra
      Tel: 233 (21) 760652, Fax: 233 (21) 771500, E-mail address: chaminc@gh.com
    3. The Director-General, Private Enterprise Foundation, P.O. Box C1671, Cantonments, Accra
      Tel: 233 (21) 7715056, Fax: 233 (21) 771500, E-mail address: pef@ighmail.com
    4. The President, Federation of Association of Ghanaian Exporters, P.O. Box M124, Accra
      Tel/Fax: 233 (21) 232726, 232554, E-mail address: fagc@ighmail.com
    5. The President, Association of Ghanaian Industries, P.O. Box 8624, Accra-North
      Tel: 233 (21) 777283, Fax: 233 (21) 773143, E-mail address: agi@ighmail.com

Procedures for Purchase of Gold and Diamonds

  • Application forms for Licenses to purchase Diamond may be obtained by any foreign company and/individuals from the PMMC. Completed forms must be returned to the Managing Director of PMMC with a non-refundable fee of USD$100.
  • Processing of application forms requires a confidential status report on the company. Whilst this is being done, a temporary license may be issued not exceeding six months. A company so issued with a temporary license may commence purchase of rough diamonds only upon the payment in full US$1,000 per month for the period approved and an up-front payment transfer of not less than USD$250,000 is required. All unutilized funds will be transferable. Fees for permanent Licenses are US$12,000 per annum. This is renewable every year.
  • Permanent license holders are required to purchase not less than US$150,000 worth of diamonds per month.
  • All buying agents are provided with an office at Diamond House with basic office furnishing for the purpose of buying rough diamonds.
  • A temporary or permanent buyer must engage resident valuer(s) to purchase the rough diamonds by negotiating directly with local winners and agents alongside other buyers at competitive prices.
  • All purchasing activity must be done in this office at Diamond House and not at the mining sites.
  • A commission of not more than 3% on the export value of rough diamonds shipped at the request of the agent to a designated address is paid to PMMC.
  • A license will be withdrawn immediately for the following reasons:
    • Inactivity for a period exceeding 21 days without prior notice
    • Buying diamonds outside the premises
    • Infringement or violation of Ghana's Mining Laws
    • An official adverse report on the status of the company
    • Buying malpractice including dealing with solely selected agents/winners
    • Using the office for other purposes other than buying diamonds

Enquiries

The Managing Director
Precious Minerals Marketing Corporation
Diamond House
P O Box 108
Accra
Ghana

Tel: +233 21 664931-4
Fax: +233 21 662586
Telex: 20-5-Dimond GH

Trade and Industry Policies

The Ministry of Trade and Industry is pursuing trade and industry measures which ensure a stable policy environment for achieving a neutral status for Ghanaian industry, for export development and promotion, an outward orientation of the economy, and er-sectoral co-ordination. Harmonisation and rationalisation of trade and industry polices are on-going.

Trade Sector Policies

In implementing medium-term policies in the trade sector; account is taken of Ghana’s objectives of participating fully in the globalised market, the rationalisation of tariffs, and the promotion of intra regional trade.

Policies are therefore being pursued within the framework of national macro-economic objectives and strategies that take account of the opportunities presented by the Uruguay Round results and other multilateral trade agreements.

In the medium term, trade sector policies that are the focus of attention are:

  1. creation of a buoyant and self-sustaining export sector
  2. expansion of domestic trade thereby ensuring the countrywide availability of goods at reasonable prices
  3. pursuit of efficient and effective import management practices
  4. adoption of anti-monopoly legislation and other regulations to protect the consumer
  5. pursuit of anti-dumping policies in international trade through rationalisation of all tariff and the identification of all non-tariff barriers to trade
  6. active and effective participation in multilateral trade for a secure increased market access for Ghana's exports especially processed and semi-processed goods and to achieve stable, fair and remunerative prices for commodities of export interest in Ghana

Industrial Sector Policies

The thrust of the industrial policy is the promotion of an accelerated and sustainable industrial development within a liberalised and global economic environment. Long-term policy objectives in the main are:

  1. increasing industry share of GDP to 37% (by 2020) from the current level of 16% with an average growth rate of 12%
  2. making Ghanaian manufactured goods competitive in the domestic and international markets
  3. establishing effective linkages between manufacturing, agriculture, education, services and other relevant sectors
  4. ensuring that all industrial operations are environmentally friendly
  5. securing increased domestic and foreign private investment in industry
  6. maximising the use of local raw materials in the industry

Medium term objectives consist of:

  1. Restructuring the industrial sector and rehabilitating major industries, including expansion, diversification and modernisation of existing viable enterprises and enhancement of their competitiveness.
  2. Promoting the establishment of new industrial capacities and environmentally sound industrial operations, including increased investment, development and acquisition of appropriate technologies in the following areas:
    1. food and agro-based industries, as well as forest industries
    2. building and construction industries
    3. metallurgical industries
    4. engineering industries, especially electrical and electronic industries
    5. textiles/garments and leather industries
    6. chemical industries
    7. energy-related and environmentally friendly industries
    8. packaging industries
  3. Promoting the local indigenous private sector and involving both local and foreign private enterprises to a greater degree in the industrial development of the country.
  4. Enhancing Ghana's international competitiveness in goods and services through standardisation.

To enhance the achievement of these objectives, considerable emphasis is placed on capacity-building, promotion of women in industry, self-employment through entrepreneurial development, and micro and small enterprises development.


Scenes from Ghana
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