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Transacting in Africa – did you know?

By Katia Mengel & Steven Gamble (ZA) on January 30, 2015
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Africa’s diversity is reflected in its legal systems. The following legal curiosities give a taste of what makes the continent such an interesting, and sometimes challenging, place to transact.

Did you know?

  • A Nigerian guarantor cannot make payment under a guarantee denominated in South African Rand without a Certificate of Capital Importation. This is issued by a bank in Nigeria when funds are imported into Nigeria. It is therefore not common for Nigerian entities to give guarantees for transactions in which funds do not flow into Nigeria.
  • The giving of security by a Ghanaian company will typically attract stamp duty in Ghana. The principal security document will be assessed at the rate of 0.5% of the secured sums, and each other security document will be assessed at the rate of 0.25% of the secured sums.
  • Namibia and Zimbabwe do not use special notarial bonds, although they do register general notarial bonds as security.
  • Ghana does not automatically recognise South African judgments and their courts may revisit the merits of any South African judgment.
  • Many former French colonies are signatories to the Organisation pour l’Harmonisation en Afrique du Droit des Affaires (OHADA) treaty, which puts in place a uniform system of business laws. The system draws strongly on a French model of business laws. Member states are: Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Comoros, Republic of the Congo, Côte d’Ivoire, Equatorial Guinea, Gabon, Guinea, Guinea-Bissau, Mali, Niger, Senegal, Togo, Democratic Republic of Congo.
  • Ownership of land in some African countries (such as in Tanzania and Mozambique) vests with the state. Private rights over the land can only be obtained by way of leasehold.
  • South Africa, Namibia and Zimbabwe have legal systems that are based on Roman-Dutch law. Countries like Zambia, Uganda and Kenya are more closely aligned to English law. West Africa has a European codified system which is developed through the OHADA Treaty.
  • Some African countries manage their foreign currency reserves by way of exchange control. In particular, South Africa, Lesotho, Namibia and Swaziland form part of a common monetary area (CMA) in which any funds flowing out of the CMA countries requires authorisation from the Reserve Bank of South Africa.
  • In countries such as the DRC and Madagascar mineral rights vest in the state.

We can help you make these curiosities commonplace.

Photo of Katia Mengel Katia Mengel
Read more about Katia MengelEmail
Photo of Steven Gamble (ZA) Steven Gamble (ZA)
Read more about Steven Gamble (ZA)Email
  • Posted in:
    Financial, International
  • Blog:
    Financial services: Regulation tomorrow
  • Organization:
    Norton Rose Fulbright
  • Article: View Original Source

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