MAS 354: Company Law II - History, Nature, and Scope

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Questions and Answers

What is one of the main objectives of the Companies Act?

To eliminate the need for auditors in companies

To allow investors to make quick profits

To provide for greater accountability by fiduciaries (correct)

To reduce the power of directors in companies

What is the role of the executive in corporate affairs?

To manage company funds

To make laws for companies

To supervise corporate affairs (correct)

To appoint company directors

What was the outcome of the 'Gower Commission'?

The Ghanaian Business Law Review

The Companies Act of 2007

The International Corporate Governance Standards

The Companies Code of 1963 for Ghana (correct)

What is a consequence of non-compliance with the Companies Act?

A penalty or fine (C) Signup and view all the answers

What was the primary goal of the new Companies Act, 2019 (Act 992)?

To introduce improved corporate governance standards (A) Signup and view all the answers

What is an aspect of corporate governance regulated by the Companies Act?

The rights and duties of members, directors, officers, and auditors of the company (C) Signup and view all the answers

How are companies generally classified?

By object, mode of ownership, extent of liability, and mode of formation (A) Signup and view all the answers

Who is protected by the Companies Act?

The general public, including creditors and investors (B) Signup and view all the answers

What is another objective of the Companies Act?

To protect the interest of persons in employment relationships with companies (B) Signup and view all the answers

What is a company, according to the general definition?

An association of persons formed for the purpose of an undertaking or business (A) Signup and view all the answers

What is the name of the Act that regulated the activities of companies in Ghana from 1963 to August 2019?

Act 179 (B) Signup and view all the answers

What type of company is formed by a grant from the government?

Chartered company (B) Signup and view all the answers

What is the definition of a company according to the 1st Schedule of the Companies Act, 2019 (Act 992)?

A body formed and registered under this Act (A) Signup and view all the answers

What is Company Law concerned with?

The formation, governance, and operation of companies (B) Signup and view all the answers

Which British legislation influenced the development of company law in Ghana?

Registration, Incorporation and Regulation of Joint Stock Companies Act, 1844 (C) Signup and view all the answers

What was the first general law on companies specifically made for the Gold Coast?

Gold Coast Company Ordinance, 1907 (B) Signup and view all the answers

Who was appointed by the Government of Ghana to review the Gold Coast Companies Ordinance of 1907?

Prof. Gower (C) Signup and view all the answers

In which year did the Government of Ghana appoint a commission to review the Gold Coast Companies Ordinance of 1907?

1958 (B) Signup and view all the answers

What was the main issue with the Gold Coast Company Ordinance of 1907?

It was hastily drafted and not suitable for the Gold Coast (C) Signup and view all the answers

What was the result of the commission appointed in 1958?

A new comprehensive legislation was enacted (A) Signup and view all the answers

Who wrote the book 'Pennington's Company Law'?

Robert R. Pennington (A) Signup and view all the answers

In which year did Ghana gain independence?

1957 (B) Signup and view all the answers

What is company law defined as?

The written body of rules and guidelines largely derived from formal enactment and custom (A) Signup and view all the answers

In Ghana, what is referred to as company law?

The Companies Act, 2019 (Act 992) (D) Signup and view all the answers

What is the scope of company law in terms of related disciplines?

A wide area touching on a number of related disciplines (B) Signup and view all the answers

What is the territorial jurisdiction of company law?

Only within the territorial jurisdiction of Ghana (B) Signup and view all the answers

What are the 4 types of companies governed by the Companies Act, 2019 (Act 992)?

Company limited by shares, company limited by guarantee, unlimited company, and external company (A) Signup and view all the answers

What is the classification of companies according to Section 7(4) of the Companies Act?

Private or public company (D) Signup and view all the answers

What is one of the thematic areas covered by the Companies Act, 2019 (Act 992)?

How companies are formed and dissolved (D) Signup and view all the answers

What is the purpose of the Companies Act, 2019 (Act 992) in relation to companies?

To outline the requirements for companies to commence business (A) Signup and view all the answers

Study Notes

History of Company Law

The development of Company law in Ghana is linked with the historical development of Company law in Britain.
The 1844 British legislation (Registration, Incorporation and Regulation of Joint Stock Companies Act, 1844) influenced Ghana's company law.
The Gold Coast Company Ordinance of 1907 was the first general law on companies in Ghana, but it was hastily drafted and needed revision.

Development of Ghana's Company Law

In 1958, the Ghanaian government appointed Prof. Gower to review the Gold Coast Companies Ordinance of 1907.
The Gower Commission's work resulted in the Companies Code of 1963 for Ghana (Act 179), which regulated companies in Ghana from 1963 to August 2019.
Act 179 was reviewed in 2007 as part of a wider review of business law, leading to the new companies Act, 2019 (Act 992).

Nature of a Company

A company is an association of persons formed for the purpose of an undertaking or business carried on in the name of the association.
Companies can be classified as:
- Chartered (formed by a grant from government)
- Statutory (formed by an Act of Parliament)
- Registered (incorporated under Companies Act)
The Companies Act, 2019 (Act 992) defines a company as "a body formed and registered under this Act".

Classifications of Companies

Companies can be classified by:
- Object or specific business undertaking (e.g., financial institutions, leasing companies, insurance companies)
- Mode of ownership (e.g., joint venture, affiliated, associated)
- Extent of liability (limited or unlimited)
- Mode of formation and legalization (e.g., partnership, sole proprietorship, limited liability)

What is Company Law?

Company law is the written body of rules and guidelines that govern and regulate the formation and operation of companies.
In Ghana, company law refers specifically to the Companies Act, 2019 (Act 992).

Nature of Company Law

Company law touches on various related disciplines, including contract law, torts law, family law, land law, business law, partnership law, and commercial law.
Company law operates within the territorial jurisdiction of Ghana and covers both substantive and procedural law.

Scope of the Companies Act, 2019 (Act 992)

The Act governs four types of companies: company limited by shares, company limited by guarantee, unlimited company, and external company.
The Act covers the formation and dissolution of companies, requirements for commencement of business, and the rights and duties of members, directors, officers, and auditors.

Objectives of the Companies Act

The objectives of the Companies Act include:
- Enhancing the position of members and ensuring greater participation in company governance
- Providing for greater accountability by fiduciaries
- Protecting the general public, particularly creditors and investors
- Ensuring compliance with the Act through penalties for non-compliance
- Protecting the interests of persons in employment relationships with companies

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Description

Learn about the history, nature, and scope of company law in Ghana, and its development influenced by British company law. This quiz is based on the course material from Kwame Nkrumah University of Science and Technology.