blog
-1
archive,category,category-blog,category-1,bridge-core-2.6.0,qode-page-transition-enabled,ajax_fade,page_not_loaded,,footer_responsive_adv,qode-theme-ver-24.5,qode-theme-bridge,qode_advanced_footer_responsive_1000,wpb-js-composer js-comp-ver-6.5.0,vc_responsive
 

With the World Health Organization (WHO) declaring Coronavirus (COVID-19) as a global pandemic, various degrees of disruptions for businesses and their workforce have come into focus. As guidance from the Government rapidly changes, most businesses in Ghana are adjusting to a large proportion of their workforce working remotely, temporary closure of business, modification of operation to reduce Employee workload and working hours and/or time-off as paid leave or unpaid leave as the case may be. In further steering these unchartered waters, key Employer considerations will include the strategies to reduce cost to business and guaranteeing the rights of Employees. Although some businesses may already have crisis management / contingency plans in place in the form of human resources policies on sick leave or remote working for example, adjustments may have to be made to such policies, with this unprecedented set of circumstances. In general terms however, an employment relationship is governed under contract, and where an unforeseen external event (such as the outbreak of a pandemic like COVID-19) occurs, making the contract incapable of performance, the parties may rely on a pre-existing force majeure provision within the contract for the suspension or termination of the employment. Some contracts may go further to include...

The Legal Framework chapter of the Oxford Business Group (OBG) Report looks at in-depth legislative investment framework for Ghana. In her Viewpoint article, our Managing Partner, focuses on some key aspects of Ghana’s current legal climate. The Report: Ghana 2020 is available on all OBG platforms and events. Click here to access the Legal Framework chapter and the Viewpoint in full....

There are a number of contracting arrangements that may be considered for construction and infrastructure projects depending on the scope of works and the services sought. Examples of such procurement and delivery mechanisms include: Design and Build, Design-Build-Operate (DBO), Build-Operate-Transfer (BOT), Construction and Management, Operation and Maintenance (OM) Contracts. The International Federation of Consulting Engineers (FIDIC) has approved a set of standard contracting forms for a variety of projects, one of which is the Engineering, Procurement and Construction (EPC) Contract. These standard contracting arrangements collectively form part of the FIDIC Suite of Contracts’. EPC has more recently become a preferred procurement mechanism for the Government of Ghana, particularly in relation to the Sinohydro Road Projects. In this blog post, we will focus on EPC Contracts and some key provisions, specifically with reference to FIDIC Silver Book 2017 Edition. 1. What is unique about the FIDIC Suite of Contracts? The FIDIC Suite of Contracts comprises of a number of ‘Books’ which reflect a universal standard for a variety of projects. The Suite is presented as a set of General Conditions, with the option for parties to ‘contract out’ of certain standard provisions by drafting Particular Conditions to suit the project as well as the relevant local...

Types of transactions that often give rise to Transfer Pricing issues The regulation provides that in determining the transfer price in transactions between persons in a controlled relationship; or taxpayers in a controlled or in an employer/employee relationship, the transaction will include any of the following; The purchase and sale of goods; The purchase, sale, lease or use of tangible and intangible assets; Provision of management, technical and other intra group services; Provision of finance and other financial arrangements; Rent and hire charges; and Any other transaction that may affect the profit or loss of the entity.   Application of transfer pricing rules to intangible property In the case of transactions involving intangible properties, the Regulations outlines factors which must be considered. In applying the comparability test in such transactions, there is a requirement to consider the following; Price to be paid by a comparable independent person to be considered together with other factors from the perspective of both parties; and Usefulness of the intangible property to the business of the transferee.   Key methods for determining Arm’s Length Price In determining the arm’s length price of transactions between parties in a controlled relationship, five methods have been prescribed within the law, in line with Chapter II...

The Transfer Pricing Issue Transfer pricing has grown in prominence with the increase in the globalization of business and the operations of multinational companies in Ghana. Unlike the open market commercial transactions, where a typical buyer will choose the lowest price for goods and services, with the seller competing to achieve the highest price, in the transfer pricing context, both the buyer and the seller are likely to have the same aim: to maximize profits within the intra-group of companies they find themselves operating. The Transfer Pricing Problem Transfer pricing arises between related or connected persons in a transaction; a parent and its subsidiary company being a classic example. The common incentive with respect to connected party transactions is to minimize the overall tax paid by the group, thereby maximizing group profit. It is reported that transfer “mispricing” adopted by some intra-group companies has caused substantive loss of government revenue in Ghana and other developing countries. For example, Global Financial Integrity Report of 2014 indicated that the cost of fraudulent invoicing in Ghana amounted to approximately $ 14.4 billion in revenue, for the ten-year period preceding the Report. Such astronomical figures are not uncommon and has resulted in most African countries adopting transfer...

The Ghana Investment Promotion Centre (“GIPC”), is a Government agency responsible for encouraging investment and economic development and regulating businesses in all sectors of the economy within the legislative framework of the Ghana Investment Promotion Centre Act, 2013 (Act 865). It is mandatory for business entities with foreign ownership, permitted pursuant to Act 865 to register with GIPC, and to do so, following the incorporation of the Company in Ghana. It is also required by Act 865, the only law with the mandate to regulate Technology Transfer Agreements (“TTAs”), that a TTA between an entity registered in Ghana (“the transferee”) and a foreign entity (“the transferor”), are registered with the GIPC and in accordance with the Technology Transfer Regulations, 1992 (L.I. 1547).   What are TTAs? TTAs are defined within Act 865 as agreements with an enterprise which have a duration of not less than 18 months, and which involve the following: the assignment, sale and licensing of all forms of industrial property with the exception of trademarks and patents which are not part of the transfer of technology; provision of technical expertise such as feasibility studies, plans, models, guides, basic or detailed engineering designs etc; provision of technical knowledge on installation and operation of...

The much debated Companies Bill 2018, was passed by the Parliament of Ghana on 2nd May 2019 introducing new and amended provisions of the corporate legislative framework in Ghana. The new law seeks to enhance transparency and shareholder engagement and promote a friendly business climate in Ghana. The following summary highlights our ‘top picks’ of the new Act and what we deem of real importance to both the local and international business community. In this Blog post, we will refer to the newly passed Bill as “the Companies Act”.[1]   Creation of the Office of the Registrar of Companies The Companies Act introduces the Office of the Registrar of Companies established to aid the registration and regulation of businesses in Ghana, akin to other jurisdictions, such as the United Kingdom’s Companies House. The Office of the Registrar will also be responsible for the appointment of company inspectors and will assume the role of official liquidator.   Abolition of the need to file a Constitution The ‘Regulations’ of a Company will now be referred to as the ‘Constitution’ of the Company. Unlike the Companies Code 1963 (Act 179), which required every company to file or register the Company’s Constitution as part of the incorporation process, it is...