The government has given businesses 60 days to amend indigenisation agreements with the state as part of changes to the controversial law which is blamed for low Foreign Direct Investment (FDI) in the southern African country, and gave more powers to line ministers.
Previously, the agreements and compliance was the sole preserve of the indigenisation ministry, but according to the latest amendments published in the government gazette last Saturday, line ministers are now empowered to assess plans and issue certificates of compliance to business.
In the gazette, the government said empowerment deals signed with foreign-owned mining firms, can be reviewed within 60 days after the publication of the revised law and gave line ministers three months days to approve or decline the new plans.
“If a business wishes to amend an indigenisation implementation plan…. the business may, not later than 60 days after the publication of the gazette notice… submit a revised plan to the line minister,” read the amendment.
The line minister “shall, no later than three months after the revised indigenisation implementation plan submitted to him or her, by notice in writing to the business concerned, either approve the revised indigenisation plan submitted by the business or reject it.”
If the revised plan is rejected, the business concerned has “one more opportunity” to submit another revised plan not later than 60 days from the date when it was notified of the rejection.
“….the line minister shall issue a certificate of compliance to the business not later than 14 working days after such request is received by the line minister,” read the amendment.
Zimbabwe’s indigenisation law demands that locals be majority owners, with a minimum 51 percent shareholding in companies valued at over $500 000.
Analysts often cite it as inhibiting Zimbabwe’s ability to attract new investment, after it registered a meagre $67 million in foreign direct investment in the first half of 2014, down from $165 million over the same period last year.- The Source