Loi sur entreprises (Cap 191), Vanuatu

LAWS OF THE REPUBLIC OF VANUATU

 COMPANIES [CAP. 191. 

Commencement: 27 October 1986

LAWS OF THE REPUBLIC OF VANUATU

CONSOLIDATED EDITION 2004

Act 12 of 1986

Act 4 of 1990

Act 31 of 1992

Act 27 of 1993

Act 4 of 1997 Act 27 of 2000

ARRANGEMENT OF SECTIONS

SECTION

PART I

Preliminary Provisions

1. Interpretation

PART II

Constitution and Incorporation of Companies

Incorporation by Registration Upon Permit of Minister

1. Application for permit to form a company
2. Form of application
3. Power to obtain further particulars
4. Requirements with respect to memorandum
5. Signature of memorandum
6. Restriction on alteration of memorandum
7. Alteration of authorised business or objects
1. Objects of existing companies
2. Articles of Association
8. Articles prescribing regulations for companies
9. Regulations required in case of unlimited company or company limited by guarantee

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

1. Adoption and application of Table A
2. Printing and signature of articles
1. Alteration of articles by special resolution
2. Form of Memorandum and Articles
1. Statutory forms of memorandum and articles
2. Registration
3. Powers of Minister on application
4. Endorsement of permit on original memorandum
5. Filing of memorandum
6. Duties of registrar before accepting memorandum
7. Certificate of incorporation, effect of registration
1. Conclusiveness of certificate of incorporation
2. Reregistration of Companies
8. Limited companies may apply for permit to be reregistered as unlimited
9. Unlimited companies may apply for permit to be reregistered as limited
10. Penalty for false statement
11. Penalty for falsification of memorandum or other document
12. Restriction on name of company
13. Change of name
14. Power of registrar to require company to abandon misleading name
1. Power to dispense with "limited" in name of charitable and other companies
2. General Provisions with respect to Memorandum and Articles
15. Effect of memorandum and articles
16. Provision as to memorandum and articles of companies limited by guarantee
17. Alterations in memorandum or articles increasing liability to contribute to share capital not to bind existing members without consent
18. Power to alter conditions in memorandum which could have been contained in articles
19. Copies of memorandum and articles to be given to members
20. Issued copies of memorandum to embody alterations

Provisions with respect to Names of Companies LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

Membership of Company

1. Definition of member
1. Membership of holding company

Private Companies

2. Meaning of "private company"
3. Consequences of default in complying with conditions constituting a company a private company
4. Restriction on alteration of articles
1. Passing of resolutions by entries in minute book etc. 
2. Reduction of Number of Members below Legal Minimum
5. Members severally liable for debts where business carried on with fewer than seven, or in case of private company two, members
6. Preincorporation contracts
7. Capacity of company

45.

Unauthorised acts

46.

Form of contracts

8. Bills of exchange and promissory notes
9. Execution of deeds abroad
1. Power of company to have official seal for use abroad

Authentication of Documents

1. Authentication of documents

PART III Share Capital and Debentures Prospectus

10. Prospectus to be approved by Minister
11. Matters to be stated and reports to be set out in prospectus
12. Exclusion of section 52 and relaxation of Schedule 4 in case of certain prospectuses
13. Expert's consent to issue of prospectus containing statement by him
14. Registration of prospectus
15. Civil liability for misstatements in prospectus

Contracts, etc. LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

1. Criminal liability for misstatements in prospectus
2. Document containing offer of shares or debentures for sale to be deemed prospectus
1. Interpretation of provisions relating to prospectuses
2. Allotment
3. Prohibition of allotment unless minimum subscription received
4. Effect of irregular allotment
5. Applications for, and allotment of, shares and debentures
6. Allotment of shares and debentures to be dealt in on stock exchange
1. Return as to allotments
2. Commissions and Discounts, etc. 
7. Power to pay certain commissions, and prohibition of payment of all other commissions, discounts, etc. 
1. Prohibition of provision of financial assistance by company for purchase of or subscription for its own, or its holding company's, shares
2. Construction of References to offering Shares or Debentures to the Public
1. Construction of references to offering shares or debentures to the public
2. Issue of Shares at Premium and Discount and Redeemable Preference Shares
8. Application of premiums received on issue of shares 
9. Prohibition on allotment of shares at a discount
1. Power to issue redeemable preference shares
2. Miscellaneous Provisions as to Share Capital
10. Power of company to arrange for different amounts being paid on shares
11. Power of company limited by shares to alter its share capital
12. Notice to registrar of consolidation of share capital, conversion of shares into stock, etc. 
1. Notice of increase of share capital
2. Reduction of Share Capital
13. Special resolution for reduction of share capital
14. Application to court for confirming order, objections by creditors, and settlement of list of objecting creditors
15. Order confirming reduction and powers of court on making such order
16. Registration of order and minute of reduction

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

1. Liability of members in respect of reduced shares
1. Penalty for concealing name of creditor, etc. 
2. Variation of Shareholders' Rights
1. Rights of holders of special classes of shares
2. Transfer of Shares and Debentures, Evidence of Title, etc. 
2. Numbering of shares
3. Transfer not to be registered except on production of instrument of transfer
4. Transfer by personal representative
5. Registration of transfer at request of transferor
6. Notice of refusal to register transfer
7. Certification of transfers
8. Duties of company with respect to issue of certificates
9. Certificate to be evidence of title
10. Evidence of grant of probate
11. Issue and effect of share warrants to bearer
1. Penalty for personation of shareholder
2. Special Provisions as to Debentures
12. Register of debenture holders
13. Rights of inspection of register of debenture holders and to copies of register and trust deed
14. Liability of trustees for debenture holders
15. Perpetual debentures
16. Power to reissue redeemed debentures in certain cases
17. Specific performance of contracts to subscribe for debentures
1. Payment of certain debts out of assets subject to floating charge in priority to claims under the charge
2. PART IV Registration of Charges Registration of Charges with Registrar of Companies
18. Registration of charges created by companies

             COMPANIES [CAP. 191. 

1. Register of charges to be kept by registrar
2. Endorsement of certificate of registration on debentures
3. Entries of satisfaction and release of property from charge
4. Rectification of register of charges
1. Registration of enforcement of security
2. Provisions as to Copies of Instruments creating Charges
5. Copies of instruments creating charges to be kept by company
1. Right to inspect copies of instruments creating charges
2. Application of Part IV to Companies Incorporated Outside Vanuatu
1. Application of Part IV to charges created, and property subject to charge acquired, by company incorporated outside Vanuatu

PART V Management and Administration Registered Office and Name

6. Registered office of company
1. Publication of name by company

Register of Members

7. Register of members

115. 

Index of members

8. Provisions as to entries in register in relation to share warrants
9. Inspection of register and index
1. Consequences of failure to comply with requirements as to register owing to

agent's default

10. Power to close register
11. Power of court to rectify register
12. Trusts not to be entered on register
1. Register to be evidence

Branch Register

13. Power for company to keep branch register
14. Regulations as to branch register
15. Stamp duty in case of shares registered in branch registers
16. Provisions as to branch registers kept in Vanuatu

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

Annual Return

127. Duty to deliver annual returns

             COMPANIES [CAP. 191. 

1. Statement in holding company's accounts of identities and places of incorporation of subsidiaries, and particulars of shareholdings therein
2. Statement in company's accounts of identities and places of incorporation of companies not subsidiaries whose shares it holds, and particulars of those shares
3. Statement in subsidiary company's accounts of name and place of incorporation of its ultimate holding company
4. Obligation to lay group accounts before holding company
5. Form of group accounts
6. Contents of groups accounts

1. Inspectors' report to be evidence
2. Appointment and powers of inspectors to investigate ownership of company
3. Power to require information as to persons interested in shares or debentures
4. Power to impose restrictions on shares or debentures
5. Saving for legal practitioners and bankers
1. Extension of Minister's powers of investigation to certain bodies incorporated outside Vanuatu
2. Inspection of Company’s Books and Papers
6. Power of Minister to require production of documents
7. Entry and search of premises
8. Provision for security of information
9. Penalization of destruction, mutilation, etc., of company documents
10. Penalization of furnishing false information
1. Saving for legal practitioners and bankers
2. Directors and other Officers
11. Directors
12. Secretary
13. Prohibition of certain persons being sole director or secretary
14. Avoidance of acts done by person in dual capacity as director and secretary
15. Validity of acts of directors
16. Restrictions on appointment or advertisement of director
17. Share qualifications of directors
18. Removal of directors
19. Alternate directors
20. Resolution in lieu of meeting
21. Provisions as to undischarged bankrupts acting as directors
22. Power to restrain fraudulent persons from managing companies
23. Loans to directors
24. Approval of company requisite for payment by it to director for loss of office, etc. 
25. Approval of company requisite for any payment, in connection with transfer of its property, to director for loss of office, etc. 
26. Duty of director to disclose payment for loss of office, etc., made in connection with transfer of shares in company

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

1. Provisions supplementary to sections 202 to 204
2. Particulars in accounts of loans to officers, etc. 
3. General duty to make disclosure for purposes of section 206
4. Disclosure by directors of interests in contracts
5. Register of directors and secretaries
1. Provisions as to assignment of office by directors
2. Avoidance of Provisions in Articles or Contracts relieving Officers from Liability
1. Provisions as to liability of officers and auditors
2. Arrangements and Reconstructions
6. Power to compromise with creditors and members
7. Information as to compromises with creditors and members
8. Provisions for facilitating reconstruction and amalgamation of companies

215. Power to acquire shares of shareholders dissenting from scheme or contract approved by majority Minorities

216. Alternative remedy to windingup in cases of oppression

PART VI WindingUp

(i) Preliminary Modes of WindingUp

1. Modes of windingup

Contributories

218.

Liability as contributories of present and past members

219. 

Definition of "contributory"

220.	Nature of liability of contributory
221.	Contributories in case of death of member
222.	Contributories in case of bankruptcy of member
	(ii)	Windingup by the Court
	Jurisdiction
223.	Jurisdiction to windup companies registered in Vanuatu

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

Cases in which a Company may be woundup by the Court

1. Circumstances in which a company may be woundup by the court
1. Definition of inability to pay debts
2. Petition for WindingUp and Effects thereof
2. Provisions as to application for windingup
3. Powers of court on hearing petition
4. Power to stay or restrain proceedings against company
5. Avoidance of dispositions of property, etc., after commencement of windingup
1. Avoidance of attachments, etc. 
2. Commencement of WindingUp
1. Commencement of windingup by the court
2. Consequences of WindingUp Order
6. Copy of order to be forwarded to registrar
7. Actions stayed on windingup order
1. Effect of windingup order
2. Official Receiver in WindingUp
8. Official receiver in bankruptcy to be official receiver for windingup purposes
9. Appointment of official receiver by court in certain cases
10. Statement of company's affairs to be submitted to official receiver

238.	Report by official receiver
239.	Power of court to appoint liquidators
240.	Appointment and powers of provisional liquidator
241.	Appointment, style, etc., of liquidators
242.	Provisions where person other than official receiver is appointed liquidator
243.	General provisions as to liquidators
244.	Custody of company's property
245.	Vesting of property of company in liquidator
246.	Powers of liquidator
247.	Exercise and control of liquidator's powers
248.	Books to be kept by liquidator
249.	Payments of liquidator into trust account, etc.
	LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

1. Audit of liquidator's accounts
2. Control of Minister over liquidators
1. Release of liquidators
2. Committees of Inspection
3. Meetings of creditors and contributories to determine whether committee of inspection shall be appointed
4. Constitution and proceedings of committee of inspection
1. Powers of Minister where no committee of inspection
2. General Powers of Court in case of Winding up by Court
5. Power to stay windingup
6. Settlement of list of contributories and application of assets
7. Delivery of property to liquidator
8. Payment of debts due by contributory to company and extent to which setoff allowed

260. Power of court to make calls

261.	Payment into bank of moneys due to company
262.	Order on contributory conclusive evidence
263.	Appointment of special manager
264.	Power to exclude creditors not proving in time
265.	Adjustment of rights of contributories
266.	Inspection of books by creditors and contributories
267.	Power to order costs of winding up to be paid out of assets
268.	Power to summon persons suspected of having property of company, etc.
269.	Power to order public examination of promoters and officers
270.	Power to arrest absconding contributory
271.	Powers of court cumulative
272	Delegation to liquidator of certain powers of court
273.	Dissolution of company
	(iii)	Voluntary WindingUp
	Resolutions for, and Commencement of, Voluntary WindingUp
274.	Circumstances in which company may be woundup voluntarily
275.	Notice of resolution to windup voluntarily
276.	Commencement of voluntary windingup

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

Consequences of Voluntary WindingUp

1. Effect of voluntary windingup on business and status of company
2. Avoidance of transfers, etc., after commencement of voluntary windingup
1. Declaration of solvency in case of proposal to wind up voluntarily
2. Provisions applicable to a Members’ Voluntary WindingUp
3. Provisions applicable to a members windingup
4. Power of company to appoint and fix remuneration of liquidators
5. Power to fill vacancy in office of liquidator
6. Power of liquidator to accept shares, etc., as consideration for sale of property of company
7. Duty of liquidator to call creditors' meeting in case of insolvency
8. Duty of liquidator to call general meeting at the end of each year
9. Final meeting and dissolution
1. Alternative provisions as to annual and final meetings in case of insolvency
2. Provisions applicable to a Creditors' Voluntary WindingUp
10. Provisions applicable to a creditors' windingup
11. Meeting of creditors
12. Appointment of liquidator
13. Appointment of committee of inspection
14. Fixing of liquidators' remuneration and cesser of directors' powers
15. Power to fill vacancy in office of liquidator
16. Application of section 283 to a creditors' voluntary windingup
17. Duty of liquidator to call meetings of company and of creditors at the end of each year
1. Final meeting and dissolution
2. Provisions applicable to every Voluntary WindingUp
18. Provisions applicable to every voluntary windingup
19. Distribution of property of company
20. Powers and duties of liquidator in voluntary windingup
21. Power of court to appoint and remove liquidator in voluntary windingup
22. Notice by liquidator of his appointment
23. Arrangement when binding on creditors

Declaration of Solvency LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

1. Power to apply to Court to have questions determined or powers exercised
2. Costs of voluntary windingup
1. Saving for rights of creditors and contributories
2. (iv) Provisions Applicable to every Mode of WindingUp Proof and Ranking of Claims
3. Debts of all descriptions may be proved
4. Application of bankruptcy rules in windingup of insolvent companies
1. Preferential payments
2. Effect of WindingUp on antecedent and other Transactions
5. Fraudulent preference
6. Liabilities and rights of certain fraudulently preferred persons
7. Effect of floating charge
8. Disclaimer of onerous property of a company
9. Restriction of rights of creditor as to execution or attachment in the case of a company being wound up
1. Duties of bailiff as to goods taken in execution
2. Offences antecedent to or in course of WindingUp
10. Offences by officers of companies in liquidation
11. Penalty for falsification of books
12. Frauds by officers of companies which have gone into liquidation
13. Liability where proper accounts not kept
14. Responsibility for fraudulent trading of persons concerned
15. Power of court to assess damages against delinquent directors, etc. 
1. Prosecution of delinquent officers and members of a company
2. Supplementary Provisions as to WindingUp
16. Disqualification for appointment as liquidator
17. Corrupt inducement affecting appointment as liquidator
18. Enforcement of duty of liquidator to make returns, etc. 
19. Notification that a company is in liquidation
20. Exemption of certain documents from stamp duty on windingup of companies
21. Books of company to be evidence

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

1. Disposal of books and papers of company
2. Information as to pending liquidations
3. Unclaimed assets in Vanuatu to be paid to Companies Liquidation Account
1. Resolutions passed at adjourned meetings of creditors and contributories
2. Supplementary Powers of Court
1. Meetings to ascertain wishes of creditors or contributories
2. Provisions as to Dissolution
4. Power of court to declare dissolution of company void
5. On registrar's windingup petition, the court may order dissolution of a company
6. Registrar may strike defunct company off register
1. Property of dissolved company to be forfeited to Republic
2. Companies Liquidation Account
7. Companies Liquidation Account

Rules and Fees

338. Rules and fees PART VII Receivers and Managers

1. Disqualification of body corporate for appointment as receiver
2. Disqualification of undischarged bankrupt from acting as receiver or manager
3. Power to appoint official receiver as receiver for debenture holders or creditors
4. Receivers and managers appointed out of court
5. Notification that receiver or manager appointed

344.	Power of court to fix remuneration on application of liquidator
345.	Provisions as to information where receiver or manager appointed
346.	Special provisions as to statement submitted to receiver
347.	Delivery to registrar of accounts of receivers and managers
348.	Enforcement of duty of receivers and managers to make returns, etc.
349.	Construction of references to receivers and managers
	PART VIII
	WindingUp of Unregistered Companies
350.	Meaning of unregistered company
	LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

1. Windingup of unregistered companies
2. Oversea companies may be wound up although dissolved
3. Saving of provisions of former law as to windingup of unregistered companies
4. Contributories in windingup of unregistered company
5. Power of court to stay or restrain proceedings
6. Actions stayed on windingup order
1. Provisions of Part VIII cumulative
2. PART IX Companies Incorporated Outside Vanuatu Provisions as to Establishment of Place of Business in Vanuatu
7. Application of Part IX
8. Oversea companies to apply for permit to be registered under Part IX
9. Return to be delivered to registrar by oversea company where documents, etc., altered
10. Accounts of oversea company
1. Obligation to state name of oversea company, whether limited, and country where
2. incorporated
11. Service on oversea company
12. Cessation of business
13. Penalties
1. Interpretation
2. Prospectuses
14. Approval of prospectus and particulars to be contained therein
15. Exclusion of section 367 and relaxation of Schedule 4 in case of certain prospectuses
16. Provisions as to expert's consent, and allotment
17. Registration of prospectus
18. Penalty for contravention of sections 367370
19. Civil liability for misstatements in prospectus
1. Interpretation of provisions as to prospectuses
2. PART X Transfer of Companies from and to another Jurisdiction
20. Continuation in Vanuatu of corporation incorporated elsewhere
21. Continuation outside Vanuatu of company incorporated under Act

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

PART XI Exempted Companies

1. Certain companies may be registered as exempted companies
2. Annual return to be filed by every exempted company
3. Restrictions on business of exempted companies 
4. Directors' meetings in Vanuatu

380.	Penalty for carrying on business contrary to this Part
381.	Application of Act to exempted companies, preservation of secrecy
382.	Certain provisions of Act to be modified in regard to private exempted companies
	not specified in Schedule 3
383.	Local companies may apply to Minister to be reregistered as exempted
	companies
384.	Exempted companies may apply to Minister to be reregistered as local
	companies
	PART XII
	French Companies
385.	Meaning of "French Company"
386.	French companies to reregister under this Act
387.	Effect of reregistration as regards company's constitution
388.	French companies no longer to be formed in Vanuatu
389.	French companies which have not been reregistered to be dissolved or woundup
	PART XIII
	Provision with respect to Partnerships
390.	Prohibition of associations, etc., with more than twenty members
	PART XIV
	General Provisions
	Registration
391.	Registration office
392.	Fees
393.	Inspection, production and evidence of documents kept by registrar
394.	No constructive notice
395.	Enforcement of duties of company and officers
	Form of Registers, etc.
	LAWS OF THE REPUBLIC OF VANUATU
	COMPANIES
	[CAP. 191.

396.	Form of registers, etc.
	Service of Documents
397.	Service of documents on a company
	Offences
398.	Penalty for false statements
399.	Penalty for improper use of word "limited"
400.	Provision with respect to default fines and meaning of "officer in default"
401.	Place of proceedings against body corporate
402.	Production and inspection of books where offence suspected
	Legal Proceedings
403.	Cost in actions by certain limited companies
404.	Power of court to grant relief in certain cases
	Application of Act to existing Companies
405.	Act to apply to companies incorporated prior to Act
	Application of Companies (WindingUp) Rules
406.	Application of Companies (WindingUp) Rules
	Miscellaneous
407.	Exemption from Part IV of the Act granted to shipowning companies
408.	Minister may delegate powers
409.	Exercise of Minister's discretion under certain sections not to be questioned in any
	court proceedings
410.	Rules
	SCHEDULES
	SCHEDULE 1 (Section 3)Application for a permit to form an incorporated
	company with or without limited liability in Vanuatu
	SCHEDULE 2 (Sections 1, 15)Tables A, B, C and D
	SCHEDULE 3 (Sections 38, 130, 163, 164, 178, 179, 183, 378, 382)Companies
	not entitled to the full privileges accorded to private companies by this Act
	SCHEDULE 4 (Sections 52, 53, 55, 60, 367, 368, 370)Matters to be specified in
	prospectus and reports to be set out therein

SCHEDULE 5 (Repealed)

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

SCHEDULE 6 (Sections 68, 150, 156, 161)Accounts

SCHEDULE 7 (Sections 26, 392, 393)Fees

SCHEDULE 8 (Section 308) – Preferential debts List of Acts referred to in section 308

COMPANIES

To enact a consolidated company law. 

PART I

PRELIMINARY PROVISIONS

INTERPRETATION

1.  (1) In this Act, unless the context otherwise requires, the following expressions have the meanings hereby assigned to them 

“accounts” includes a company's group accounts, whether prepared in the form of accounts or not;

“agent” does not include a person's counsel acting as such;

“annual fee” means the annual fee required to be paid under section 392;

“annual return” means the return required to be made under section 127 or under section 377;

“approved stock exchange” means any body of persons which is for the time being an approved stock exchange for the purposes of the Prevention of Fraud (Investments) Act, Cap 70;

“articles” means the articles of association of a company, as originally framed or as altered by special resolution, including, so far as they apply to the company, the regulations contained (as the case may be) in Table A in the First Schedule to the Companies Act, 1929, or in Table A in the First Schedule to the Companies Act, 1948, or in Table A in the Second Schedule to the Companies Regulation (Q.R. No. 9 of 1971), or in Table A in Schedule 2 to this Act;

“book and paper” and “book or paper” include accounts, deeds, writings and documents;

“branch register” has the meaning assigned to it by section 123(n( �/span>;

“Companies Act, 1929” or “Companies Act, 1948” means the United Kingdom Companies Acts of 1929 and 1948;

“company” means a company formed and registered under this Act or an existing company;

“company limited by guarantee” and “company limited by shares” have the meanings assigned to them respectively by section 2(2);

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

“contributory” has the meaning assigned to it by section 219;

“creditors' voluntary winding up” has the meaning assigned to it by section 279(4);

“debenture” includes debenture stock, bonds and any other securities of a company whether constituting a charge on the assets of the company or not;

“default fine” has the meaning assigned to it by section 400;

“director” includes any person occupying the position of director by whatever name called;

“document” includes notice, order, summons, and other legal process, and register;

“exempted company” means a company registered or reregistered as an exempted company under section 376 or section 383, respectively;

“existing company” means a company formed and registered in Vanuatu under the Companies Act, 1929, or the Companies Act, 1948, or the New Hebrides Companies (Incorporation) Regulation, 1970, or the Companies Regulation (Q.R. No. 9 of 1971);

“financial year” has the meaning assigned to it by section 149;

“French company” has the meaning assigned to it by section 385;

“general rules” means general rules made under section 338, and includes forms; “group accounts” has the meaning assigned to it by section 154(n( �/span>;

“holding company” means a holding company as defined by section 158; “issued generally” means, in relation to a prospectus, issued to persons who are not existing members or debenture holders of the company;

“local company” means a company other than an exempted company;

“members’ voluntary winding up” has the meaning assigned to it by section 279(4); “the minimum subscription” has the meaning assigned to it by section

60(2);

“memorandum” means the memorandum of association of' a company, as originally framed or as altered in pursuance of any enactment; “officer”, in relation to a body corporate, includes a director, manager or

secretary;

“oversea company” means a company incorporated outside Vanuatu to which the provisions of Part IX apply; “printed” includes typewritten and reproduced by any process of

duplicating, rotaprinting, cyclostyling or photocopying; “private company” has the meaning assigned to it by section 38;

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

“prospectus” means any prospectus, notice, circular, advertisement, or other invitation, offering to the public for subscription or purchase any shares or debentures of a company;

“the registrar of companies”, or when used in relation to registration of companies, “the registrar”, means the registrar or other officer performing under this Act the duty of registration of companies;

“registration fee” means the registration fee required to be paid under section 392;

“resolution for reducing share capital” has the meaning assigned to it by section 75(2);

“a resolution for voluntary winding up” has the meaning assigned to it by section 274(2);

“share” means share in the share capital of a company, and includes stock except where a distinction between stock and shares is expressed or implied;

“share warrant” has the meaning assigned to it by section 91(2);

“subsidiary” means a subsidiary as defined by section 158;

“Table A” means Table A in Schedule 2;

“the time of the opening of the subscription lists” has the meaning assigned to it by section 62(n( �/span>;

“unlimited company” has the meaning assigned to it by section 2(2). 

(2)

A person shall not be deemed to be within the meaning of any provision in this Act a person in accordance with whose directions or instructions the directors of a company are accustomed to act, by reason only that the directors of the company act on advice given by him in a professional capacity. 

(3)

References in this Act to a body corporate or to a corporation shall be construed as not including a corporation sole but as including a company incorporated outside Vanuatu. 

PART II

CONSTITUTION AND INCORPORATION OF COMPANIES

INCORPORATION BY REGISTRATION UPON PERMIT OF MINISTER

APPLICATION FOR PERMIT TO FORM A COMPANY

2. (1) Application may be made to the Minister, by or on behalf of any seven or more persons, or, where it is desired to form a private company, any two or more persons, associated for any lawful purpose, for a permit to form an incorporated company, with or without limited liability. LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(2)

Such a company may be

(a)

a company having the liability of its members limited by the memorandum to the amount, if any, unpaid on the shares respectively held by them (in this Act termed "a company limited by shares"); or

(b)

a company having the liability of its members limited by the memorandum to such amount as the members may respectively thereby undertake to contribute to the assets of the company in the event of its being wound up (in this Act termed "a company limited by guarantee"); or

(c)

a company not having any limit on the liability of its members (in this Act termed "an unlimited company"). 

(3)

A company limited by guarantee shall not be registered with shares and shall not create or issue shares. 

FORM OF APPLICATION

3.  (1) An application for a permit, subject to any directions of the Minister, shall be in the form and shall contain the particulars set out in Schedule 1 and, without prejudice thereto, shall state 

(a)

the full names (including any former names), addresses and nationalities of the applicants;

(b)

the precise nature and fields of operation and place of the business intended to be carried on by the company and the place proposed for its registered office, 

and shall be accompanied by the original memorandum of association, duly subscribed, and articles of association, if any, duly signed, to be filed with the registrar, together with such number of facsimile copies thereof as the Minister may require.

(2) An application for a permit shall be treated as a confidential official document by the Minister and all public officers having access thereto and the provisions of subsections (3), (4) and (5) of section 381 shall have effect, in the case of any company proposed to be registered as an exempted company, with respect to the information therein contained. 

POWER TO OBTAIN FURTHER PARTICULARS

4.  (1) Before reaching a decision upon an application for a permit, the Minister may require the applicants to provide such further information relating to themselves or to the proposed company or to other persons having in interest or intending to have an interest in the company as the Minister may specify; and unless the Minister is satisfied that the applicants have supplied such information to the best of their ability the Minister shall, without prejudice to his powers under section 16, refuse to proceed further with the application:

Provided that in the case of a proposed exempted private company not being a company of a class specified in Schedule 3 no information shall be so required respecting the beneficial interest of any person in the company. 

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(2) Any information so provided by or on behalf of the applicants for a permit shall be treated as confidential by the Minister and all public officers having access thereto and the provisions of subsections (3), (4) and (5) of section 381 shall have effect, in relation to any company proposed to be registered as an exempted company, with respect to such information. 

REQUIREMENTS WITH RESPECT TO MEMORANDUM

5.  (1) At least seven persons, or, where it is desired to form a private company, at least two persons, shall subscribe their names to the memorandum of every company. 

(2)

The memorandum of every company shall state 

(a)

the full names (including any former names), addresses and nationalities of the persons who subscribe their names to the memorandum;

(b)

the name of the company, with the word "Limited" as the last word of the name in the case of a company limited by shares or by guarantee;

(c)

whether the company is to be a local company or an exempted company;

(d)

the part of Vanuatu in which the registered office of the company is proposed to be situate;

(e)

the restrictions, if any, upon the business to be carried on by the company, or upon the objects of the company, or a statement that the business or objects of the company are unrestricted; and

(f)

the names of the first directors of the company. 

(3)

The memorandum of a company limited by shares or by guarantee must also state that the liability of its members is limited. 

(4)

The memorandum of a company limited by guarantee must also state that each member undertakes to contribute to the assets of the company in the event of its being wound up while he is a member, or within one year after he ceases to be a member, for payment of the debts and liabilities of the company contracted before he ceases to be a member, and of the costs, charges and expenses of windingup, and for adjustment of the rights of the contributories among themselves, such amount as may be required, not exceeding a specified amount. 

(5)

In the case of a company having a share capital 

(a)

the memorandum must also, unless the company is an unlimited company, state the amount of share capital with which the company proposes to be registered and the division thereof into shares of a fixed amount;

(b)

no subscriber of the memorandum may take less than one share;

(c)

each subscriber must write opposite to his name in words the number of shares he takes. 

SIGNATURE OF MEMORANDUM

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

1. The memorandum must be signed by each subscriber in the presence of at least one witness who must attest the signature, and the full names of each subscriber and witness shall also be printed or legibly written thereon. 
2. RESTRICTION ON ALTERATION OF MEMORANDUM
1. A company may not alter the provisions of its memorandum except in the cases, in the mode and to the extent for which express provision is made in this Act. 
2. ALTERATION OF AUTHORISED BUSINESS OR OBJECTS
1. (1) A company may, by special resolution, alter its memorandum by changing, imposing or removing any restriction upon the business which it is authorised to carry on or by altering the objects for which it is established:

Provided that if an application is made to the court in accordance with this section for the alteration to be annulled, it shall not have effect except in so far as it is confirmed by the court. 

(2)

Within 28 days of the passing of any such resolution notice thereof shall be given to the holders of all debentures secured by a floating charge over any of the company's property and to the trustees, if any, for such debenture holders. 

(3)

Application to the court under this section shall be made within 60 days after the passing of the resolution. 

(4)

An application to the court under this section may be made 

(a)

in the case of a private company, by any member or by anyone to whom notice has been given under subsection (2); or

(b)

in the case of a public company, by

(i)

the holders of not less than 5 per cent in the aggregate of the company's issued shares or of any class thereof or, if the company has no shares, by not less than 5 per cent of the company's members;

(ii)

by the trustees for the holders of any debentures secured by a floating charge over any of the company's property; or

(iii) by the holders of not less than 5 per cent of the company's debentures secured by a floating charge over any of the company's property. 

(5)

If an application to the court is made under this section the company shall forthwith deliver to the registrar for registration notice of that fact. 

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(6)

On an application under this section the court may make an order confirming the alteration in whole or in part and on such terms and conditions as it thinks fit and may adjourn the proceedings in order that an arrangement may be made to the satisfaction of the court for the purchase of the interests of dissentients and may give such directions and make such orders as it may think expedient for facilitating and carrying into effect any such arrangement. If the court shall refuse to confirm the alteration it shall make an order annulling the alteration. 

(7)

The company shall within 21 days of the making by the court of any order under this section deliver a copy thereof to the registrar for registration. 

(8)

If a company makes default in giving or publishing any notice or delivering any document as required by this section, the company and every officer of the company who is in default shall be liable to a default fine. 

OBJECTS OF EXISTING COMPANIES

1. A statement contained in the memorandum of a company incorporated before the commencement of this Act (27 October 1986) which specifies the objects for which the company is established shall, in so far as such objects relate to the carrying on of any business, be deemed to be a statement that the business which the company is permitted to carry on is restricted to the objects so specified, and shall be subject in all respects to the provisions of this Act. 
2. There may in the case of a company limited by shares, and there shall in the case of a company limited by guarantee or unlimited, be registered with the memorandum articles of association signed by the subscribers to the memorandum and prescribing regulations for the company. 

ARTICLES OF ASSOCIATION

ARTICLES PRESCRIBING REGULATIONS FOR COMPANIES REGULATIONS REQUIRED IN CASE OF UNLIMITED COMPANY OR COMPANY LIMITED BY GUARANTEE

11.	(1)	In the case of an unlimited company the articles must state the number of
		members with which the company proposes to be registered and, if the
		company has a share capital, the amount of share capital with which the
		company proposes to be registered.
	(2)	In the case of a company limited by guarantee, the articles must state the
		number of members with which the company proposes to be registered.
	(3)	Where	an	unlimited company	or	a	company limited by guarantee has
		increased the number of its members beyond the registered number, it
		shall, within 15 days after the increase was resolved on or took place, give
		to the registrar of companies notice of the increase, and the registrar shall
		record the increase.

If default is made in complying with this subsection, the company and every officer of the company who is in default shall be liable to a default fine. 

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

ADOPTION AND APPLICATION OF TABLE A

12.  (1) Articles of association may adopt all or any of the regulations contained in Table A. 

(2) In the case of a company limited by shares and registered after the commencement of this Act (27 October 1986), if articles are not registered, or, if articles are registered, in so far as the articles do not exclude or modify the regulations contained in Table A, those regulations shall, so far as applicable, be the regulations of the company in the same manner and to the same extent as if they were contained in duly registered articles. 

PRINTING AND SIGNATURE OF ARTICLES

13. Articles must –

(a)

be printed;

(b)

be divided into paragraphs numbered consecutively;

(c)

be signed by each subscriber of the memorandum of association in the presence of at least one witness who must attest the signature, and the full names of each subscriber and witness shall also be printed or legibly written thereon. 

ALTERATION OF ARTICLES BY SPECIAL RESOLUTION

14.	(1)	Subject to the provisions of this Act and to the conditions contained in its
		memorandum,	a		company may by special resolution alter				or	add to its
		articles.
	(2)	Any alteration		or		addition	so	made in the articles shall, subject			to the
		provisions of this Act, be as valid as if originally contained therein, and be
		subject in like manner to alteration by special resolution.

FORM OF MEMORANDUM AND ARTICLES STATUTORY FORMS OF MEMORANDUM AND ARTICLES

15.  The form of 

(a)

the memorandum of association of a company limited by shares;

(b)

the memorandum and articles of association of a company limited by guarantee and not having a share capital;

(c)

the memorandum and articles of association of an unlimited company having a share capital;

shall be respectively in accordance with the forms set out in Tables B, C, and D in Schedule 2, or as near thereto as circumstances admit. 

REGISTRATION POWERS OF MINISTER ON APPLICATION

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

1. Subject to the provisions of this Act, the Minister may in his discretion grant or refuse a permit for which application is made under this Act and need not give any reason for his decision upon the application. 
2. ENDORSEMENT OF PERMIT ON ORIGINAL MEMORANDUM
1. (1) A permit granted under section 16 shall be endorsed on the original of the memorandum and shall be in such form as the Minister shall determine. 

(2) The memorandum endorsed with the permit and the original of the articles (if any) shall as soon as possible be returned to the applicants or the person or persons acting on their behalf. 

FILING OF MEMORANDUM

1. If a permit is endorsed on a memorandum, the persons who have subscribed their names thereto may, within 6 months after the date of the grant of the permit, file the memorandum with the registrar. 
2. DUTIES OF REGISTRAR BEFORE ACCEPTING MEMORANDUM
1. Before accepting a memorandum for filing the registrar shall satisfy himself that it is duly endorsed with a permit and that it conforms with the requirements of this Act. 
2. CERTIFICATE OF INCORPORATION, EFFECT OF REGISTRATION
1. (1) Upon the due filing of the memorandum the registrar shall retain and forthwith register the memorandum, the name of the company, and the articles (if any), specifying whether it is registered as a local company or an exempted company, in a register to be maintained by him for the purpose; and shall then forthwith issue under his hand or seal a certificate of incorporation with the date of registration and its status as a local or exempted company, as the case may be, specified therein, together with a facsimile copy of the memorandum, and articles, if any, filed. 

(2) From the date of incorporation mentioned in the certificate of incorporation, the subscribers of the memorandum, together with such other persons as may from time to time become members of the company, shall be a body corporate by the name contained in the memorandum, capable forthwith of exercising all the functions of an incorporated company, and having perpetual succession and a common seal, but with such liability on the part of the members to contribute to the assets of the company in the event of its being woundup as is mentioned in this Act. 

CONCLUSIVENESS OF CERTIFICATE OF INCORPORATION

21.  A certificate of incorporation given by the registrar in respect of any association shall be conclusive evidence that all the requirements of this Act in respect of registration and of matters precedent and incidental thereto have been complied with, and that the association is a company authorised to be registered and duly registered under this Act.

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

REREGISTRATION OF COMPANIES

LIMITED COMPANIES MAY APPLY FOR PERMIT TO BE REREGISTERED AS UNLIMITED

22.  (1) A company which, at the date of the commencement of this Act (27 October 1986), was registered as limited or thereafter is so registered (otherwise than in pursuance of section 23) may apply to the Minister for a permit to be reregistered as unlimited; and such application

shall comply with the requirement of subsection (2), shall be signed by a director or by the secretary of the company and shall be lodged with the Minister together with the documents mentioned in subsection (3). 

(2)

The said requirement is that the application must –

(a)

set out such alterations in the company's memorandum as 

(i)

if it is to have a share capital, are requisite to bring it, both in substance and in form, into conformity with the requirements imposed by this Act with respect to the substance and form of the memorandum of a company to be formed as an unlimited company having a share capital; or

(ii)

if it is not to have a share capital, are requisite in the circumstances; and

(b)

if articles have been registered, set out such alterations therein and additions thereto as 

(i)

if it is to have a share capital, are requisite to bring them, both in substance and in form, into conformity with the requirements imposed by this Act with respect to the substance and form of the articles of a company to be formed as an unlimited company having a share capital; or

(ii)

if it is not to have a share capital, are requisite in the circumstances; and if articles have not been registered, have annexed thereto, printed articles proposed for registration, being, if the company is to have a share capital, articles complying with the said requirements and, if not, articles appropriate to the circumstances. 

(3)

The documents referred to in subsection (1) above are –

(a)

the written assent to the company's being registered as unlimited subscribed by or on behalf of all the members of the company;

(b)

a declaration made by the directors of the company that the persons by whom or on whose behalf the form of assent is subscribed constitute the whole membership of the company and, if any of the members have not subscribed that form themselves, that the directors have taken all reasonable steps to satisfy themselves that each person who subscribed it on behalf of a member was lawfully empowered so to do;

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(c)

a printed copy of the memorandum incorporating the alterations therein set out in the application; and

(d)

if articles have been registered, a printed copy thereof incorporating the alterations therein and additions thereto set out in the application. 

(4)

The Minister may require the applicant to furnish any further or other information he may think necessary; and, having considered the

application, he may in his discretion grant or refuse a permit applied for under this section and need not give any reasons for his decision. 

(5)

Upon the granting of a permit under subsection (4), the Minister shall endorse the application accordingly and return it and the other documents submitted as soon as possible to the company, which may within 3 months from the date of the permit lodge them with the registrar for reregistration of the company. 

(6)

The registrar shall retain the application and other documents lodged with him under subsection (5) and shall, if articles are annexed to the application, register them and shall issue to the company a certificate of incorporation appropriate to the status to be assumed by the company by virtue of this section; and upon the issue of the certificate 

(a)

the status of the company shall, by virtue of the issue, be changed from limited to unlimited; and

(b)

the alterations in the memorandum set out in the application and (if articles have been previously registered) any alterations and additions to the articles so set out shall, notwithstanding any other provisions of this Act, take effect as if duly made by resolution of the company and the provisions of this Act shall apply to the memorandum and articles as altered or added to by virtue of this section accordingly. 

(7)

A certificate of incorporation issued by virtue of this section shall be conclusive evidence that the requirements of this section with respect to reregistration and of matters precedent and incidental thereto have been complied with, and that the company was authorised to be reregistered under this Act in pursuance of this section and was duly so reregistered. 

(8)

Where a company is reregistered in pursuance of this section, a person who, at the time when the application for it to be reregistered was lodged, was a past member of the company and did not thereafter again become a member thereof shall not, in the event of the company's being woundup, be liable to contribute to the assets of the company more than he would have been liable to contribute thereto had it not been so reregistered. 

(9)

For the purposes of this section 

(a)

subscription to a form of assent by the legal personal representative of a deceased member of a company shall be deemed to be subscription by him;

(b)

a trustee in bankruptcy of a person who is a member of a company shall, to the exclusion of that person, be deemed to be a member of the company. 

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UNLIMITED COMPANIES MAY APPLY FOR PERMIT TO BE REREGISTERED AS LIMITED

23.  (1) A company which, at the commencement of this Act (27 October 1986), was registered as unlimited or thereafter is so registered (otherwise than by virtue of section 22) may apply to the Minister for a permit to be reregistered as limited if a special resolution that it should so apply to be reregistered (complying with the requirement of subsection (2)) is passed; and such application shall be signed by a director or by the secretary of the company and shall be lodged with the Minister together with the documents mentioned in subsection (3), not earlier than the day on which the copy of the resolution forwarded to the registrar of companies in pursuance of section 144 is received by the registrar. 

(2) The said requirement is that the resolution 

(a)

must state the manner in which the liability of the members of the company is to be limited and, if the company is to have a share capital, what that capital is to be; and

(b)

must 

(i)

if the company is to be limited by guarantee, provide for the making of such alterations in its memorandum and such alterations in and additions to its articles as are requisite to bring the memorandum and articles, both in substance and in form, into conformity with the requirements of this Act with respect to the substance and form of the memorandum and articles of a company to be formed as a company limited by guarantee;

(ii)

if the company is to be limited by shares, provide for the making of such alterations in its memorandum as are requisite to bring it, both in substance and in form, into conformity with the requirements of this Act with respect

to the substance and form of the memorandum of a company to be formed as a company so limited, and such alterations in and additions to its articles as are requisite in the circumstances. 

(3)

The documents referred to in subsection (1) above are a printed copy of the resolution, a printed copy of the memorandum as altered in pursuance of the resolution and a printed copy of the articles as so altered. 

(4)

The Minister may require the applicant to furnish any further or other information he may think necessary; and, having considered the application, he may in his discretion grant or refuse a permit applied for under this section and need not give any reasons for his decision. 

(5)

Upon the granting of a permit under subsection (4), the Minister shall endorse the application accordingly and return it and the other documents submitted as soon as possible to the company, which may within 3 months from the date of the permit lodge them with the registrar for reregistration of the company. 

(6)

The registrar shall retain the application and other documents lodged with him under subsection (5) and shall issue to the company a certificate of incorporation appropriate to the

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status to be assumed by the company by virtue of this section; and upon the issue of the certificate 

(a)

the status of the company shall, by virtue of the issue, be changed from unlimited to limited; and

(b)

the alterations in the memorandum specified in the resolution and the alterations in, and additions to, the articles so specified shall, notwithstanding any other provisions of this Act, take effect. 

(6)

A certificate of incorporation issued by virtue of this section shall be conclusive evidence that the requirements of this section with respect to reregistration and of matters precedent and incidental thereto have been complied with, and that the company was authorised to be reregistered under this Act in pursuance of this section and was duly so reregistered. 

(8)

In the event of the windingup of a company reregistered in pursuance of this section, the following provisions shall have effect 

(a)

notwithstanding paragraph (a) of section 218, a past member of the company who was a member thereof at the time of reregistration shall, if the windingup commences within the period of 3 years beginning with the day on which the company is reregistered, be liable to contribute to the assets of the company in respect of its debts and liabilities contracted before that time;

(b)

where no persons who were members of the company at that time are existing members of the company, a person who, at that time, was a present or past member thereof shall, subject to paragraph

(a) of section 218 and to paragraph (a) of this subsection, but notwithstanding paragraph (c) of section 218, be liable to contribute as aforesaid notwithstanding that the existing members have satisfied the contributions required to be made by them in pursuance of this Act;

(c)

notwithstanding paragraphs (d) and (e) of section 218, there shall be no limit on the amount which a person who, at that time, was a past or present member of the company is liable to contribute as aforesaid. 

PENALTY FOR FALSE STATEMENT

1. Any person who knowingly makes any statement which is false or which he does not believe to be true for the purpose of obtaining any permit or approval of the Minister under this Act shall be liable on conviction to a fine not exceeding VT200,000 or to a term of imprisonment not exceeding 12 months or to both. 
2. PENALTY FOR FALSIFICATION OF MEMORANDUM OR OTHER DOCUMENT
1. Any person who, without lawful authority, makes any material alteration to a memorandum or other document after the Minister has granted a permit in relation thereto or has otherwise signified his approval thereto shall be liable on conviction to a fine not exceeding VT200,000 or to a term of imprisonment not exceeding 12 months or to both. 

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PROVISIONS WITH RESPECT TO NAMES OF COMPANIES

RESTRICTION ON NAME OF COMPANY

26.	(1)	No company shall be permitted to be registered by a name which in the
		opinion of the Minister is undesirable.
	(2)	Without prejudice to the generality of subsection (1), no company shall be
		permitted to be registered by a name which
		(a) is identical with the name by which a company is registered under
		this Act or under which a company has at any time been
		incorporated in Vanuatu (whether or not that
		company has been dissolved) or so nearly resembles such name as
		to be in the opinion of the Minister calculated or likely to deceive
		or mislead;
		(b) suggests or is likely to suggest connection with the government of
		any country or with any public international Organisation or with
		any public board or statutory corporation or any municipal or other
		local authority;
		(b) contains the words "cooperative" or "building society".
	(3)	A person may apply in writing to the registrar for the reservation of a
		name of a company for the incorporation of which a permit is to be
		sought, a name to which a company proposes to change its name or a
		name under which an oversea company proposes to apply for a permit to
		be registered, either originally or on change of name.
	(4)	If the registrar is satisfied as to the bona fides of the application and that
		the proposed name is a name by which an intended company, company or
		oversea company could be registered without contravention of subsection
		(1) or subsection (2), he shall, upon payment of the fee prescribed by
		Schedule 7, reserve the proposed name for a period of 6 months from the
		date of the lodging of the application.
	(5)	During a period for which a name is reserved, no company, oversea
		company, person, firm or society (other than the applicant for reservation
		of the name) shall be registered under this Act or any other Act, whether
		originally or on change of name, under the reserved name or under any
		other name which, in the opinion of the registrar, so closely resembles the
		reserved name as to be calculated or likely to be mistaken for that name.
	(6)	The reservation of a name under this section in respect of an intended
		company, company or oversea company shall not in itself entitle the

intended company, company, or oversea company to be registered by that name, either originally or on change of name. 

CHANGE OF NAME

27.  (1) A company may by special resolution and with the approval of the registrar signified in writing change its name. 

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(2) If, through inadvertence or otherwise, a company on its first registration or on its registration by a new name is registered by a name which, in the opinion of the registrar, is too like the name by which a company in existence is previously registered, the firstmentioned company

may change its name with the sanction of the registrar and, if he so directs within 12 months of its being registered by that name, shall change it within a period of 6 weeks from the date of the direction or such longer period as the registrar may think fit to allow. 

If a company makes default in complying with a direction under this subsection, it shall be liable to a fine not exceeding VT1,000 for every day during which the default continues. 

(3)

Where a company changes its name under this section, the registrar shall enter the new name on the register in place of the former name, and shall issue a certificate of incorporation altered to meet the circumstances of the case. 

(4)

A change of name by a company under this section shall not affect any rights or obligations of the company or render defective any legal proceedings by or against the company, and any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its new name. 

POWER OF REGISTRAR TO REQUIRE COMPANY TO ABANDON MISLEADING NAME

28.  (1) If, in the opinion of the registrar, the name by which a company is registered gives so misleading an indication of the nature of its activities as to be likely to cause harm to the public, he may direct it to change its name. 

(2)

A direction given under this section to a company must, if not duly made the subject of an application under subsection (3) to the court, be complied with within a period of 6 weeks from the date of the direction or such longer period as the registrar may think fit to allow. 

(3)

A company to which a direction is given under this section may, within a period of 3 weeks from the date of the direction, apply to the court to set the direction aside, and the court may set it aside or confirm it; and, if it confirms it, it shall specify a period within which it must be complied with. 

(4)

If a company makes default in complying with a direction under this section, it shall be liable to a fine not exceeding VT1,000 for every day during which the default continues. 

(5)

The provisions of subsection (3) and subsection (4) of section 27 shall apply to a change of name under this section. 

POWER TO DISPENSE WITH “LIMITED” IN NAME OF CHARITABLE AND OTHER COMPANIES

29. (1) Where it is proved to the satisfaction of the Minister that an association about to be formed as a limited company is to be formed for promoting commerce, art, science, religion, charity or any other useful object, and intends to apply its profits, if any, or other income in promoting its objects, and to prohibit the payment of any dividend to its members, the Minister may by LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

licence direct that the association may be registered as a company with limited liability, without the addition of the word "limited" to its name, and the association may be registered accordingly and shall, on registration, enjoy all the privileges and (subject to the provisions of this section) be subject to all the obligations of limited companies. 

(2) Where it is proved to the satisfaction of the Minister –

(a)

that the objects of a company registered under this Act as a limited company are restricted to those specified in the subsection (1) and to objects incidental or conducive thereto; and

(b)

that by its constitution the company is required to apply its profits, if any, or other income in promoting its objects and is prohibited from paying any dividend to its members;

the Minister may by licence authorise the company to make by special resolution a change in its name including or consisting of the omission of the word "limited", and subsections (3) and (4) of section 27 shall apply to a change of name under this subsection as they apply to a change of name under that section. 

(3)

A licence by the Minister under this section may be granted on such conditions and subject to such regulations as the Minister thinks fit, and those conditions and regulations shall be binding on the body to which the licence is granted, and (where the grant is under subsection (1)) shall, if the Minister so directs, be inserted in the memorandum and articles, or in one of those documents. 

(4)

A body to which a licence is granted under this section shall be excepted from the provisions of this Act relating to the use of the word "limited" as any part of its name, the publishing of its name and the sending of lists of members to the registrar of companies. 

(5)

A licence under this section may at any time be revoked by the Minister, and upon revocation the registrar shall enter the word "limited" at the end of the name upon the register of the body to which it was granted, and the body shall cease to enjoy the exemptions and privileges or, as the case may be, the exemptions granted by this section:

Provided that, before a licence is so revoked, the Minister shall give to the body notice in writing of his intention, and shall afford it an opportunity of being heard in opposition to the revocation. 

(6)

Where a body in respect of which a licence under this section is in force alters the provisions of its memorandum with respect to its objects, the Minister may (unless he sees fit to revoke the licence) vary the licence by making it subject to such conditions and regulations as the Minister thinks fit, in lieu of or in addition to the conditions and regulations, if any, to which the licence was formerly subject. 

GENERAL PROVISIONS WITH RESPECT TO MEMORANDUM AND ARTICLES

EFFECT OF MEMORANDUM AND ARTICLES LAWS OF THE REPUBLIC OF VANUATU

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30.  (1) Subject to the provisions of this Act, the memorandum and articles shall, when registered, bind the company and the members thereof to the same extent as if they respectively had been signed and sealed by each member, and contained covenants on the part of each member to observe all the provisions of the memorandum and of the articles. 

(2) All money payable by any member to the company under the memorandum or articles shall be a debt due from him to the company, and shall be of the nature of a specialty debt. 

PROVISION AS TO MEMORANDUM AND ARTICLES OF COMPANIES LIMITED BY GUARANTEE

31.  (1) In the case of a company limited by guarantee every provision in the memorandum or articles or in any resolution of the company purporting to give any person a right to participate in the divisible profits of the company otherwise than as a member shall be void. 

(2) For the purpose of the provisions of this Act relating to the memorandum of a company limited by guarantee and of this section, every provision in the memorandum or articles, or in any resolution, of a company limited by guarantee, purporting to divide the undertaking of the company into shares or interests shall be treated as a provision for a share capital, notwithstanding that the nominal amount or number of the shares or interests is not specified thereby. 

ALTERATIONS IN MEMORANDUM OR ARTICLES INCREASING LIABILITY TO CONTRIBUTE TO SHARE CAPITAL NOT TO BIND EXISTING MEMBERS WITHOUT CONSENT

32.  Notwithstanding anything in the memorandum or articles of a company, no member of the company shall be bound by an alteration made in the memorandum or articles after the date on which he became a member, if and so far as the alteration requires him to take or subscribe for more shares than the number held by him at the date on which the alteration is made, or in any way increases his liability as at that date to contribute to the share capital of, or otherwise to pay money to, the company:

Provided that this section shall not apply in any case where the member agrees in writing, either before or after the alteration is made, to be bound thereby. 

POWER TO ALTER CONDITIONS IN MEMORANDUM WHICH COULD HAVE BEEN CONTAINED IN ARTICLES

33.  (1) Subject to the provisions of section 32 and of section 216, any condition contained in a company's memorandum which could lawfully have been contained in articles of association instead of in the memorandum may, subject to the provisions of this section, be altered by the company by special resolution:

Provided that if an application is made to the court for the alteration to be cancelled, it shall not have effect except in so far as it is confirmed by the court. 

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(2)

This section shall not apply where the memorandum itself provides for or prohibits the alteration of all or any of the said conditions, and shall not authorise any variation or abrogation of the special rights of any class of members. 

(3)

Subsections (3), (4), (5), (6), (7) and (8) of section 8 (except that subsection (4) shall only apply to applications to the court by any member of a private company and as provided in paragraph (b)(i) of the said subsection (4)) shall apply in relation to any alteration and to any application made under this section as they apply in relation to alterations and to applications made under that section. 

(4)

This section shall apply to a company's memorandum whether registered before or after the commencement of this Act (27 October 1986). 

COPIES OF MEMORANDUM AND ARTICLES TO BE GIVEN TO MEMBERS

1. A company shall, on being so required by any member, send to him a copy of the memorandum and of the articles, if any, subject to payment, in the case of a copy of the memorandum and of the articles, of VT2,000 or such less sum as the company may prescribe.
2. (1) Where an alteration is made in the memorandum of a company, every

ISSUED COPIES OF MEMORANDUM TO EMBODY ALTERATIONS copy of the memorandum issued after the date of the alteration shall be in accordance with the alteration. 

(2) If, where any such alteration has been made, the company at any time after the date of the alteration issues any copies of the memorandum which are not in accordance with the alteration, it shall be liable to a fine not exceeding VT1,000, and every officer of the company who is in default shall be liable to the like penalty. 

MEMBERSHIP OF COMPANY DEFINITION OF MEMBER

36.  (1) The subscribers of the memorandum of a company shall be deemed to have agreed to become members of the company, and on its registration shall be entered as members in its register of members. 

(2) Every other person who agrees to become a member of a company, and whose name is entered in its register of members, shall be a member of the company. 

MEMBERSHIP OF HOLDING COMPANY

37.  (1) Except in the cases hereafter in this section mentioned, a body corporate cannot be a member of a company which is its holding company, and any allotment or transfer of shares in a company to its subsidiary shall be void. 

(2) Nothing in this section shall apply where the subsidiary is concerned as personal representative, or where it is concerned as trustee, unless the holding company or a subsidiary thereof is beneficially interested under the trust and is not so interested only by way of \

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             COMPANIES [CAP. 191. 

security for the purposes of a transaction entered into by it in the ordinary course of a business which includes the lending of money. 

(3)

This section shall not prevent a subsidiary which is, at the commencement of this Act, a member of its holding company, from continuing to be a member but, subject to subsection (2), the subsidiary shall have no right to vote at meetings of the holding company or any class of members thereof. 

(4)

Subject to subsection (2) of this section, subsections (1) and (3) thereof shall apply in relation to a nominee for a body corporate which is a subsidiary, as if references in the said subsections (1) and (3) to such a body corporate included references to a nominee for it. 

(5)

In relation to a company limited by guarantee or unlimited which is a holding company, the reference in this section to shares shall be construed as including a reference to the interest of its members as such, whatever the form of that interest. 

PRIVATE COMPANIES MEANING OF "PRIVATE COMPANY"

38.  (1) For the purposes of this Act, subject to subsection (3), the expression "private company" means a company which by its articles 

(a)

restricts the right to transfer its shares; and

(b)

limits the number of its members to fifty, not including persons who are in the employment of the company and persons who, having been formerly in the employment of the company, were while in that employment, and have continued after the determination of that employment to be, members of the company; and

(c)

prohibits any invitation to the public to subscribe for any shares or debentures of the company. 

(2)

Where two or more persons hold one or more shares in a company jointly, they shall, for the purposes of this section, be treated as a single member. 

(3)

Notwithstanding subsection (1), in the case of an exempted private company which is not of a class specified in Schedule 3, the expression "private company" means a company which by its articles prohibits any invitation to the public to subscribe for any shares or debentures of the company. 

CONSEQUENCES OF DEFAULT IN COMPLYING WITH CONDITIONS CONSTITUTING A COMPANY A PRIVATE COMPANY

39 Where the articles of a company include the provisions which, under section 38, are required to be included in the articles of a company in order to constitute it a private company but default is made in complying with any of those provisions, the company shall cease to be entitled to the privileges and exemptions conferred on private companies under the provisions contained in section 42, paragraph (d) of section 224 and paragraph (i) of proviso (a) to subsection (1) of section 226 and

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thereupon the provisions contained in those enactments shall apply to the company as if it were not a private company:

Provided that the court, on being satisfied that the failure to comply with the conditions was accidental or due to inadvertence or to some other sufficient cause, or that on other grounds it is just and equitable to grant relief, may, on the application of the company or any other person interested and on such terms and conditions as seem to the court just and expedient, order that the company be relieved from such consequences as aforesaid. 

RESTRICTION ON ALTERATION OF ARTICLES

40.  (1) A company, being a private company, may not alter its articles in such manner and for the purpose that the company shall cease to be a private company except in accordance with the provisions of subsection (2). 

(2) A company, being a private company, which seeks to alter the provisions of its articles in order that the company shall cease to be a private company shall submit to the Minister details of the alteration and of the reasons therefor together with such further information as the Minister in his discretion may require, for the approval of the Minister and, unless the approval of the Minister thereof is signified in writing, any resolution purporting to alter such provisions shall be null and void. 

PASSING OF RESOLUTIONS BY ENTRIES IN MINUTE BOOK ETC. 

41.  (1) Anything which may be done by a company registered under Part II by resolution, special resolution, or extraordinary resolution passed at a meeting of the company may, subject to any special provisions in that behalf in the articles of the company, be done by a private company in the same manner or by resolution passed, without a meeting or any previous notice being required, by means of an entry in its minute book signed by at least threefourths of the members having the right to vote on that resolution, holding in the aggregate at least threefourths in nominal value of the shares giving that right. 

(2)

It shall not be necessary for a private company to hold an annual general meeting if everything required to be done at that meeting by resolution, special resolution, or extraordinary resolution (including the adoption or

approval of every balance sheet or other document required to be laid before the meeting) is, within the time prescribed for the holding of the meeting, done by means of an entry in its minute book in accordance with this section. 

(3)

Any such entry may be signed on behalf of a member by his agent duly authorised in writing. 

(4)

For the purposes of this section a memorandum pasted or otherwise permanently affixed in the minute book and purporting to have been signed for the purpose of becoming an entry therein shall be deemed to be an entry accordingly, and any such entry may consist of several documents in like form, each signed by or on behalf of one or more members. 

(5)

The company shall within 7 days after any resolution is passed by means of an entry in its minute book in accordance with this section send to every member by or on behalf of whom the entry has not been signed a copy thereof, including the signatures. 

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(6)

If default is made in complying with subsection (5), the company and every officer of the company who is in default shall be liable to a default fine. 

(7)

The provisions of section 144 shall apply to resolutions which have been passed by means of entries in the minute book of a private company in accordance with the foregoing provisions of this section to the same extent as if those resolutions had been passed at a meeting of the company. 

(8)

Where a private company passes a resolution for a creditors' voluntary winding up by means of an entry in its minute book in accordance with the foregoing provisions of this section, the company, instead of complying with the requirements of subsection (1) of section 289, shall cause a meeting of the creditors of the company to be summoned for a day not later than the tenth day after the day on which the resolution is passed, and shall cause notice of the said meeting to be sent by post to the creditors at least 7 days before the day on which the meeting is to be held. In every such case all references in this Act to subsection (1) of the said section 289 shall be read as references to this subsection. 

(9)

Where a private company passes a resolution for a creditors' voluntary winding up by means of an entry in its minute book in accordance with the foregoing provisions of this section, the company may at the same time, or at any subsequent time before the date of the meeting of creditors to be

summoned as provided in subsection (8), appoint the official receiver to be the provisional liquidator of the company; and thereupon the official receiver shall become the provisional liquidator and shall continue to act as such until he or another person becomes liquidator and is capable of acting as such. 

REDUCTION OF NUMBER OF MEMBERS BELOW LEGAL MINIMUM

MEMBERS SEVERALLY LIABLE FOR DEBTS WHERE BUSINESS CARRIED ON WITH FEWER THAN SEVEN, OR IN CASE OF PRIVATE COMPANY TWO MEMBERS

42.  If at any time the number of members of a company is reduced, in the case of a private company, below two, or, in the case of any other company, below seven, and it carries on business for more than 6 months while the number is so reduced, every person who is a member of the company during the time that it so carries on business after those 6 months and is cognisant of the fact that it is carrying on business with fewer than two members, or seven members, as the case may be, shall be severally liable for the payment of the whole debts of the company contracted during that time, and may be severally sued therefore. 

CONTRACTS, ETC. 

PREINCORPOPATION CONTRACTS

43.	(1)	Any person who purports to enter into a contract in the name of or on
		behalf of		a		company before it				comes		into existence shall be personally
		bound	by		the		contract	and	entitled		to		the	benefits	thereof, except	as
		provided in this section.
	(2)	A company may within a reasonable time after it comes into existence,
		expressly, or by any action or conduct signifying its intention to be bound
		thereby, adopt a written contract made

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before it came into existence in its name or on its behalf, and upon such adoption, subject to subsection (3) 

(a)

the company shall for all purposes be bound by the contract and entitled to the benefits thereof as if the company had been in

existence at the date of such contract and had been a party thereto; and

(b)

the person who purported to act in the name of or on behalf of the company shall, except as provided in subsection (3), cease to be bound by or entitled to the benefits of the contract.

(3)

Except as provided in subsection (4), whether or not a contract made before the coming into existence of a company is adopted by the company, the other party to the contract may apply to the court for an order fixing obligations under the contract as joint or joint and several, or apportioning liability between or among the company and the person who purported to act in the name of or on behalf of the company, and upon such application the court may make any order it thinks fit. 

(4)

If expressly so provided in the written contract, the person who purported to act in the name of or on behalf of the company before it came into existence shall not in any event be bound by the contract nor entitled to the benefits thereof. 

CAPACITY OF COMPANY

1. A company shall have and shall be deemed always to have had the capacity of a natural person of full capacity, subject only to such limitations as are inherent in its corporate nature. 
2. UNAUTHORISED ACTS
1. (1) A company shall not carry on any business or pursue any object or exercise any power that it is restricted by its memorandum or articles from carrying on or pursuing or exercising, nor exercise any of its powers in a manner inconsistent with its memorandum or articles:

Provided that (subject to subsections (2), (3) and (4)) no act of a company and no transfer of property to or by a company shall be invalid by reason only that the act or transfer may contravene or have contravened this subsection. 

(2)

On the application of 

(a)

any member of the company; or

(b)

the holder of any debenture secured by a floating charge over all or any of the company's property or by a trustee for the holders of any such debentures, 

(3)

Where the act or transaction sought to be prohibited in any proceedings under subsection (2) is being or is to be performed or made under a contract to which the company is a party, all

the court may prohibit by injunction the doing of any act or the conveyance or transfer of any property in breach of subsection (1). 

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parties to the contract shall be made parties to the proceedings, and the court may make any order as to compensation or otherwise as it may consider equitable. 

(4) Any breach of subsection (1) may be asserted in any proceedings under section 216 or 224 and in any action against a director or other officer of the company for breach of duty or breach of trust. 

FORM OF CONTRACTS

46.  (1) Contracts on behalf of a company may be made as follows 

(a)

a contract which if made between private persons would be by law required to be in writing and under seal shall be made on behalf of the company in writing under the common seal of the company;

(b)

a contract which is made between private persons would be by law required to be in writing, signed by the parties to be charged therewith, may be made on behalf of the company in writing signed by any person acting under its authority, express or implied;

(c)

a contract which if made between private persons would by law be valid although made by parol only, and not reduced into writing, may be made by parol on behalf of the company by any person acting under its authority, express or implied. 

(2)

A contract made according to this section shall be effectual in law, and shall bind the company and its successors and all other parties thereto. 

(3)

A contract made according to this section may be varied or discharged in the same manner in which it is authorised by this section to be made. 

BILLS OF EXCHANGE AND PROMISSORY NOTES

47.  A bill of exchange or promissory note shall be deemed to have been made, accepted or endorsed on behalf of a company if made, accepted or endorsed in the name of, or by or on behalf or on account of, the company by any person acting under its authority. 

EXECUTION OF DEEDS ABROAD

48.  (1) A company may, by writing under its common seal, empower any person, either generally or in respect of any specified matters, as its attorney, to execute deeds on its behalf in any place not situated in Vanuatu. 

(2) A deed signed by such an attorney on behalf of the company and under his seal shall bind the company and have the same effect as if it were under its common seal. 

POWER FOR A COMPANY TO HAVE OFFICIAL SEAL FOR USE ABROAD

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49.  (1) A company whose objects require or comprise the transaction of business in foreign countries may, if authorised by its articles, have for use in any territory, district, or place not situated in Vanuatu, an official seal, which shall be a facsimile of the common seal of the company, with the addition on its face of the name of every territory, district or place where it is to be used. 

(2)

A deed or other document to which an official seal is duly affixed shall bind the company as if it had been sealed with the common seal of the company. 

(3)

A company having an official seal for use in any such territory, district or place may, by writing under its common seal, authorise any person appointed for the purpose in that territory, district or place to affix the official seal to any deed or other document to which the company is party in that territory, district or place. 

(4)

The authority of any such agent shall, as between the company and any person dealing with the agent, continue during the period, if any, mentioned in the instrument conferring the authority, or if no period is there mentioned, then until notice of the revocation or determination of the agent's authority has been given to the person dealing with him. 

(5)

The person affixing any such official seal shall, by writing under his hand, certify on the deed or other instrument in which the seal is affixed the date on which and the place at which it is affixed. 

AUTHENTICATION OF DOCUMENTS

AUTHENTICATION OF DOCUMENTS

50.  A document or proceeding requiring authentication by a company may be signed by a director, secretary or other authorised officer of the company, and need not be under its common seal. 

PART III

SHARE CAPITAL AND DEBENTURES

PROSPECTUS

PROSPECTUS TO BE APPROVED BY MINISTER

1. No prospectus shall be issued by or on behalf of a company or in relation to an intended company unless the Minister has first given his approval. 
2. MATTERS TO BE STATED AND REPORTS TO BE SET OUT IN PROSPECTUS
1. (1) Subject to the provisions of section 53, every prospectus issued by or on behalf of a company, or by or on behalf of any person who is or has been engaged or interested in the formation of the company, must be dated, and must state the matters specified in Part I of Schedule 4 and set out the reports specified in Part II of that Schedule, and the said Parts I and II shall have effect subject to the provisions contained in Part III of that Schedule. 

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(2)

A condition requiring or binding an applicant for shares in or debentures of a company to waive compliance with any requirement of this section, or purporting to affect him with notice of any contract, document or matter not specifically referred to in the prospectus, shall be void. 

(3)

Subject to the provisions of section 53, it shall not be lawful to issue any form of application for shares in or debentures of a company unless the form is issued with a prospectus which complies with the requirements of this section:

Provided that this subsection shall not apply if it is shown that the form of application was issued either 

(a)

in connection with a bona fide invitation to a person to enter into an underwriting agreement with respect to the shares or debentures; or

(b)

in relation to shares or debentures which were not offered to the public. 

If any person acts in contravention of the provisions of this subsection, he shall be liable to a fine not exceeding VT1,000,000. 

(4) In the event of noncompliance with or contravention of any of the requirements of this section, a director or other person responsible for the prospectus shall not incur any liability by reason of the noncompliance or contravention, if 

(a)

as regards any matter not disclosed, he proves that he was not cognisant thereof; or

(b)

he proves that the noncompliance or contravention arose from an honest mistake of fact on his part; or

(c)

the noncompliance or contravention was in respect of matters which in the opinion of the court were immaterial or was otherwise such as ought, in the opinion of the court, having regard to all the circumstances of the case, reasonably to be excused:

Provided that, in the event of failure to include in a prospectus a statement with respect to the matters specified in paragraph 16 of Schedule 4, no director or other person shall incur any liability in respect of the failure unless it be proved that he had knowledge of the matters not disclosed. 

(5) This section shall not apply 

(a) to the issue to existing members or debenture holders of a company of a prospectus or form of application relating to shares in or debentures of the company, whether an applicant for shares or debentures will or will not have the right to renounce in favour of other persons; or

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(b) to the issue of a prospectus or form of application relating to shares or debentures which are or are to be in all respects uniform with shares or debentures previously issued and for the time being dealt in or quoted on an approved stock exchange;

but, subject as aforesaid, this section shall apply to a prospectus or a form of application whether issued on or with reference to the formation of a company or subsequently. 

(6) Nothing in this section shall limit or diminish any liability which any person may incur under the general law or this Act apart from this section. 

EXCLUSION OF SECTION 52 AND RELAXATION OF SCHEDULE 4 IN CASE OF CERTAIN PROSPECTUSES

53.  (1) Where 

(a)

it is proposed to offer any shares in or debentures of a company to the public by a prospectus issued generally (that is to say, issued to persons who are not existing members or debenture holders of the company); and

(b)

application is made to an approved stock exchange for permission for those shares or debentures to be dealt in or quoted on that stock exchange:

there may, on the request of the applicant, be given by or on behalf of that stock exchange a certificate of exemption, that is to say, a certificate that, having regard to the proposals (as stated in the request) as to the size and other circumstances of the issue of shares or debentures and as to any limitations on the number and class of persons to whom the offer is to be made, compliance with the requirements of Schedule 4 would be unduly burdensome. 

(2) If a certificate of exemption is given, and if the proposals aforesaid are adhered to and the particulars and information required to be published in connection with the application for permission made to the stock exchange are so published, then 

(a)

a prospectus giving the particulars and information aforesaid in the form in which they are so required to be published shall be deemed to comply with the requirements of Schedule 4; and

(b)

section 52 shall not apply to any issue, after the permission applied for is granted, of a prospectus or form of application relating to the shares or debentures. 

EXPERT'S CONSENT TO ISSUE OF PROSPECTUS CONTAINING STATEMENT BY HIM

54.  (1) A prospectus inviting persons to subscribe for shares in or debentures of a company and including a statement purporting to be made by an expert shall not be issued unless 

(a) he has given and has not, before delivery of a copy of the prospectus for registration, withdrawn his written consent to the issue thereof with the statement included in the form and context in which it is included; and

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(b) a statement that he has given and has not withdrawn his consent as aforesaid appears in the prospectus. 

(2)

If any prospectus is issued in contravention of this section the company and every person who is knowingly a party to the issue thereof shall be liable to a fine not exceeding VT1,000,000. 

(3)

In this section the expression "expert" includes engineer, valuer, accountant and any other person whose profession gives authority to a statement made by him. 

REGISTRATION OF PROSPECTUS

55.  (1) No prospectus shall be issued by or on behalf of a company or in relation to an intended company unless, on or before the date of its publication, there has been delivered to the registrar of companies for registration a copy thereof signed by every person who is named therein as a director or proposed director of the company, or by his agent authorised in writing, and having endorsed thereon or attached thereto 

(a)

any consent to the issue of the prospectus required by section 54 from any person as an expert; and

(b)

in the case of a prospectus issued generally, also 

 (i)

a copy of any contract required by paragraph 14 of Schedule 4 to be stated in the prospectus or, in the case of a contract not reduced into writing, a memorandum giving full particulars thereof or, if in the case of a prospectus deemed by virtue of a certificate granted under section 53 to comply with the requirements of that Schedule a contract or a copy thereof or a memorandum of a contract is required to be available for inspection in connection with the application made under that section to the stock exchange, a copy or, as the case may be, a memorandum of that contract; and

(ii)

where the persons making any report required by Part II of that Schedule have made therein, or have, without giving the reasons, indicated therein, any such adjustments as are mentioned in paragraph 29 of that Schedule, a written statement signed by those persons setting out the adjustments and giving the reasons therefor. 

The references in subparagraph (i) of paragraph (b) of this subsection to the copy of a contract required thereby to be endorsed on or attached to a copy of the prospectus shall, in the case of a contract wholly or partly in a foreign language, be taken as references to a copy of a translation of the contract in English or French or a copy embodying a translation into English or French of the parts in a foreign language, as the case may be, being a translation certified in the prescribed manner to be a correct translation, and the reference to a copy of a contract required to be available for inspection shall include a reference to a copy of a translation thereof or a copy embodying a translation of parts thereof. 

(2) Every prospectus shall, on the face of it 

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(a)

state that a copy has been delivered for registration as required by this section; and

(b)

specify, or refer to statements included in the prospectus which specify, any documents required by this section to be endorsed on or attached to the copy so delivered. 

(3)

The registrar shall not register a prospectus unless it is dated and the copy thereof signed in manner required by this section and unless it has endorsed thereon or attached thereto the documents (if any) specified as aforesaid. 

(4)

If a prospectus is issued without a copy thereof being delivered under this section to the registrar or without the copy so delivered having endorsed thereon or attached thereto the required documents, the company, and every person who is knowingly a party to the issue of the prospectus, shall be liable to a fine not exceeding VT1,000 for every day from the day of the issue of the prospectus until a copy thereof is so delivered with the required documents endorsed thereon or attached thereto. 

CIVIL LIABILITY FOR MISSTATEMENTS IN PROSPECTUS

56.  (1) Subject to the provisions of this section, where a prospectus invites persons to subscribe for shares in or debentures of a company, the following persons shall be liable to pay compensation to all persons who subscribe for any shares or debentures on the faith of the prospectus for the loss or damage they may have sustained by reason of any untrue statement included therein, that is to say 

(a)

every person who is a director of the company at the time of the issue of the prospectus;

(b)

every person who has authorised himself to be named and is named in the prospectus as a director or as having agreed to become a director either immediately or after an interval of time;

(c)

every person being a promoter of the company; and

(d)

every person who has authorised the issue of the prospectus:

Provided that where, under section 54, the consent of a person is required to the issue of a prospectus and he has given that consent, he shall not by reason of his having given it be liable under this subsection as a person who has authorised the issue of the prospectus except in respect of an untrue statement purporting to be made by him as an expert. 

(2) No person shall be liable under subsection (1) of this section if he proves 

(a) that, having consented to become a director of the company, he withdrew his consent before the issue of the prospectus, and that it was issued without his authority or consent; or

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(b)

that the prospectus was issued without his knowledge or consent, and that on becoming aware of its issue he forthwith gave reasonable public notice that it was issued without his knowledge or consent; or

(c)

that, after the issue of the prospectus and before allotment thereunder, he, on becoming aware of any untrue statement therein, withdrew his consent thereto and gave reasonable public notice of the withdrawal and of the reason therefor; or

(d)	that
	(i)	as	regards					every					untrue			statement							not			purporting						to		be
		made on the authority of an expert or of a public official
		document or statement, he had reasonable
		grounds to believe, and did up to the time of the allotment
		of the shares or debentures,																		as	the	case					may be, believe,
		that the statement was true; an
	(ii)	as		regards					every					untrue				statement						purporting						to			be		a
		statement by an expert or contained in what purports to be a
		copy of or extract from a report or valuation of an expert, it
		fairly represented the statement, or was a correct and fair
		copy of or extract from the report or valuation, and he had
		reasonable grounds to believe and did up to the time of the
		issue of the prospectus believe that the person making the
		statement				was				competent to make it and that person had
		given the consent required by section 54 to the issue of the
		prospectus					and					had			not		withdrawn								that			consent			before
		delivery of a copy of the prospectus for registration or, to
		the			defendant's						knowledge,								before				allotment						thereunder;
		and

(iii) as regards every untrue statement purporting to be a statement made by an official person or contained in what purports to be a copy of or extract from a public official document, it was a correct and fair representation of the statement or copy of or extract from the document:

Provided that this subsection shall not apply in the case of a person liable, by reason of his having given a consent required of him by the said section 54, as a person who has authorised the issue of the prospectus in respect of an untrue statement purporting to be made by him as an expert. 

(3) A person who, apart from this subsection would under subsection (1) be liable, by reason of his having given the consent required of him by section 54, as a person who has authorised the issue of a prospectus in respect of an untrue statement purporting to be made by him as an expert shall not be so liable if he proves 

(a)

that, having given his consent under the said section 54 to the issue of the prospectus, he withdrew it in writing before delivery of a copy of the prospectus for registration; or

(b)

that, after delivery of a copy of the prospectus for registration and before allotment thereunder, he, on becoming aware of the untrue statement, withdrew his consent in writing and gave reasonable public notice of the withdrawal, and of the reason therefor; or

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(c) that he was competent to make the statement and that he had reasonable grounds to believe and did up to the time of the allotment of the shares or debentures, as the case may be, believe that the statement was true. 

(4) Where 

(a)

the prospectus contains the name of a person as a director of the company, or as having agreed to become a director thereof, and he has not consented to become a director, or has withdrawn his consent before the issue of the prospectus, and has not authorised or consented to the issue thereof; or

(b)

the consent of a person is required under section 54 to the issue of the prospectus and he either has not given that consent or has withdrawn it before the issue of the prospectus;

the directors of the company, except any without whose knowledge or consent the prospectus was issued, and any other person who authorised the issue thereof shall be liable to indemnify the person named as aforesaid or whose consent was required as aforesaid, as the case may be, against all damages, costs and expenses to which he may be made liable by reason of his name having been inserted in the prospectus or of the inclusion therein of a statement purporting to be made by him as an expert, as the case may be, or in defending himself against any action or legal proceeding brought against him in respect thereof:

Provided that a person shall not be deemed for the purposes of this subsection to have authorised the issue of a prospectus by reason only of his having given the consent required by section 54 to the inclusion therein of a statement purporting to be made by him as an expert. 

(5) For the purposes of this section 

(a)

the expression "promoter" means a promoter who was a party to the preparation of the prospectus, or of the portion thereof containing the untrue statement, but does not include any person by reason of his acting in a professional capacity for persons engaged in procuring the formation of the company; and

(b)

the expression "expert" has the same meaning as in section 54. 

CRIMINAL LIABILITY FOR MISSTATEMENTS IN PROSPECTUS

57. (1) Where a prospectus issued after the commencement of this Act (27 October 1986) includes any untrue statement, any person who authorised the issue of the prospectus shall be liable to imprisonment for a term not exceeding 2 years, or a fine not exceeding VT1,000,000, or both, unless he proves either that the statement was immaterial or that he had reasonable grounds to believe and did, up to the time of the issue of the prospectus, believe that the statement was true. LAWS OF THE REPUBLIC OF VANUATU

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(2) A person shall not be deemed for the purposes of this section to have authorised the issue of a prospectus by reason only of his having given the consent required by section 54 to the inclusion therein of a statement purporting to be made by him as an expert. 

DOCUMENT CONTAINING OFFER OF SHARES OR DEBENTURES FOR SALE TO BE DEEMED PROSPECTUS

58.  (1) Where a company allots or agrees to allot any shares in or debentures of the company with a view to all or any of those shares or debentures being offered for sale to the public, any document by which the offer for sale to the public is made shall for all purposes be deemed to be a prospectus issued by the company, and all enactments and rules of law as to the contents of prospectuses and to liability in respect of statements in and omissions from prospectuses, or otherwise relating to prospectuses, shall apply and have effect accordingly, as if the shares or debentures had been offered to the public for subscription and as if persons accepting the offer in respect of any shares or debentures were subscribers for those shares or debentures, but without prejudice to the liability, if any, of the persons by whom the offer is made, in respect of misstatements contained in the document or otherwise in respect thereof. 

(2)

For the purposes of this Act, it shall, unless the contrary is proved, be evidence that an allotment of, or an agreement to allot, shares or debentures was made with a view to the shares or debentures being offered for sale to the public if it is shown 

(a)

that an offer of the shares or debentures or of any of them for sale to the public was made within 6 months after the allotment or agreement to allot; or

(b)

that at the date when the offer was made the whole consideration to be received by the company in respect of the shares or debentures had not been so received.

(3)

Section 52 as applied by this section shall have effect as if it required a prospectus to state in addition to the matters required by that section to be stated in a prospectus 

(a)

the net amount of the consideration received or to be received by the company in respect of the shares or debentures to which the offer relates; and

(b)

the place and time at which the contract under which the said shares or debentures have been or are to be allotted may be inspected;

and section 55 as applied by this section shall have effect as though the persons making the offer were persons named in a prospectus as directors of a company. 

(4) Where a person making an offer to which this section relates is a company or a firm, it shall be sufficient if the document aforesaid is signed on behalf of the company or firm by two directors of the company or not less than half of the partners, as the case may be, and any such director or partner may sign by his agent authorised in writing. 

INTERPRETATION OF PROVISIONS RELATING TO PROSPECTUSES

59.  For the purposes of the foregoing provisions of this Part of this Act 

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(a)

a statement included in a prospectus shall be deemed to be untrue if it is misleading in the form and context in which it is included; and

(b)

a statement shall be deemed to be included in a prospectus if it is contained therein or in any report or memorandum appearing on the face thereof or by reference incorporated therein or issued therewith. 

ALLOTMENT

PROHIBITION OF ALLOTMENT UNLESS MINIMUM SUBSCRIPTION RECEIVED

60.  (1) No allotment shall be made of any share capital of a company offered to the public for subscription unless the amount stated in the prospectus as the minimum amount which, in the opinion of the directors, must be raised by the issue of share capital in order to provide for the matters specified in paragraph 4 of Schedule 4 has been subscribed, and the sum payable on application for the amount so stated has been paid to and received by the company. 

For the purposes of this subsection, a sum shall be deemed to have been paid to and received by the company if a cheque for that sum has been received in good faith by the company and the directors of the company have no reason for suspecting that the cheque will not be paid. 

(2)

The amount so stated in the prospectus shall be reckoned exclusively of any amount payable otherwise than in cash and is in this Act referred to as "the minimum subscription". 

(3)

The amount payable on application on each share shall not be less than 5 per cent of the nominal amount of the share. 

(4)

If the conditions aforesaid have not been complied with on the expiration of 40 days after the first issue of the prospectus, all money received from applicants for shares shall be forthwith repaid to them without interest, and, if any such money is not so repaid within 48 days after the issue of the prospectus, the directors of the company shall be jointly and severally liable to repay that money with interest at the rate of 10 per cent per annum from the expiration of the fortyeighth day:

Provided that a director shall not be liable if he proves that the default in the repayment of the money was not due to any misconduct or negligence on his part. 

(5)

Any condition requiring or binding any applicant for shares to waive compliance with any requirement of this section shall be void. 

(6)

This section, except subsection (3) thereof, shall not apply to any allotment of shares subsequent to the first allotment of shares offered to the public for subscription. 

EFFECT OF IRREGULAR ALLOTMENT

61. (1) An allotment made by a company to an applicant in contravention of the provisions of section 60 shall be voidable at the instance of the applicant within one month after the date of the allotment, and not later, and shall be so voidable notwithstanding that the company is in the course of being wound up. LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(2) If any director of a company knowingly contravenes, or permits or authorises the contravention of, any of the provisions of the said section with respect to allotment, he shall be liable to compensate the company and the allottee, respectively, for any loss, damages or costs which the company or the allottee may have sustained or incurred thereby:

Provided that proceedings to recover any such loss, damages, or costs shall not be commenced after the expiration of 2 years from the date of the allotment. 

APPLICATIONS FOR, AND ALLOTMENT OF, SHARES AND DEBENTURES

62.  (1) No allotment shall be made of any shares in or debentures of a company in pursuance of a prospectus issued generally and no proceedings shall be taken on applications made in pursuance of a prospectus so issued, until the beginning of the third day after that on which the prospectus is first so issued or such later time (if any) as may be specified in the prospectus. 

The beginning of the said third day or such later time as aforesaid is hereafter in this Act referred to as "the time of the opening of the subscription lists". 

(2)

The validity of an allotment shall not be affected by any contravention of the foregoing provisions of this section but, in the event of any such contravention, the company and every officer of the company who is in default shall be liable to a fine not exceeding VT100,000. 

(3)

In the application of this section to a prospectus offering shares or debentures for sale, subsections (1) and (2) shall have effect with the substitution of references to sale for references to allotment, and with the substitution for the reference to the company and every officer of the company who is in default of a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the contravention. 

(4)

An application for shares in or debentures of a company which is made in pursuance of a prospectus issued generally shall not be revocable until after the expiration of the third day after the time of the opening of the subscription lists, or the giving before the expiration of the said third day, by some person responsible under section 56 of this Act for the prospectus, of a public notice having the effect under that section of excluding or limiting the responsibility of the person giving it. 

(5)

In reckoning for the purposes of this section and section 63, the third day after another day, any intervening day which is a Saturday or Sunday or which is a public holiday in Vanuatu shall be disregarded, and if the third day (as so reckoned) is itself a Saturday or Sunday or such a public holiday there shall for the said purposes be substituted the first day thereafter which is none of them. 

(6)

This section shall not apply in relation to a prospectus to which paragraph

(a) or (b) of subsection (2) of section 53 applies.

ALLOTMENT OF SHARES AND DEBENTURES TO BE DEALT IN ON STOCK

EXCHANGE LAWS OF THE REPUBLIC OF VANUATU             COMPANIES

[CAP. 191. 

63.	(1)	Where a prospectus, whether issued generally or not, states that
		application has been or will be made for permission for the shares or
		debentures offered thereby to be dealt in on any stock exchange, any
		allotment made on an application in pursuance of the prospectus shall,
		whenever made, be void if the permission has not been applied for before
		the third day after the first issue of the prospectus or if the permission has
		been refused before the expiration of 3 weeks from the date of the closing
		of the subscription lists or such longer period not exceeding 6 weeks as
		may, within the said 3 weeks, be notified to the applicant for permission
		by or on behalf of the stock exchange.
	(2)	Where the permission has not been applied for as aforesaid, or has been
		refused as aforesaid, the company shall forthwith repay without interest all
		money received from applicants in pursuance of the prospectus, and, if
		any such money is not repaid within 8 days after the company becomes
		liable to repay it, the directors of the company shall be jointly and
		severally liable to repay that money with interest at the rate of 10 per cent
		per annum from the expiration of the eighth day: Provided that a director
		shall not be liable if he proves that the default in the repayment of the
		money was not due to any misconduct or negligence on his part.
	(3)	All money received as aforesaid shall be kept in a separate bank account
		so long as the company may become liable to repay it under subsection
		(2); and, if default is made in complying with this subsection, the company
		and every officer of the company who is in default shall be liable to a fine
		not exceeding VT500,000.
	(4)	Any condition requiring or binding any applicant for shares or debentures
		to waive compliance with any requirement of this section shall be void.
	(5)	For the purposes of this section, permission shall not be deemed to be
		refused if it is intimated that the application for it, though not at present
		granted, will be given further consideration.
	(6)	This section shall have effect

(a)

in relation to any shares or debentures agreed to be taken by a person underwriting an offer thereof by a prospectus as if he had applied therefor in pursuance of the prospectus; and

(b)

in relation to a prospectus offering shares for sale with the following modifications, that is to say 

(i)

references to sale shall be substituted for references to allotment;

(ii)

the persons by whom the offer is made, and not the company, shall be liable under subsection (2) to repay money received from applicants, and references to the company's liability under that subsection shall be construed accordingly; and for the reference in subsection (3) to the company and every officer of the company who is in default there shall be substituted a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the default. 

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

RETURN AS TO ALLOTMENTS

64.  (1) Whenever a company limited by shares makes any allotment of its shares, the company shall within one month thereafter deliver to the registrar of companies for registration 

(a)

a return of the allotments, stating the number and nominal amount of the shares comprised in the allotment, the names, addresses and descriptions of the allottees, and the amount, if any, paid or due and payable on each share; and

(b)

in the case of shares allotted as fully or partly paid up otherwise than in cash, a contract in writing constituting the title of the allottee to the allotment together with any contract of sale, or for services or other consideration in respect of which that allotment was made, such contracts being duty stamped if so required, and a return stating the number and nominal amount of shares so

allotted, the extent to which they are to be treated as paid up, and the consideration for which they have been allotted. 

(2)

Where such a contract as above mentioned is not reduced to writing, the company shall within 1 month after the allotment deliver to the registrar of companies for registration the prescribed particulars of the contract stamped with the same stamp duty (if any) as would have been payable if the contract had been reduced to writing, and those particulars shall be deemed to be an instrument within the meaning of the Stamp Duties Act, Cap. 68, and the registrar may, as a condition of filing the particulars, require that the duty payable thereon be assessed under section 9 of that Act. 

(3)

If default is made in complying with this section, every officer of the company who is in default shall be liable to a fine not exceeding VT1,000 for every day during which the default continues:

Provided that, in case of default in delivering to the registrar of companies within 1 month after the allotment any document required to be delivered by this section, the company, or any officer liable for the default, may apply to the court for relief, and the court, if satisfied that the omission to deliver the document was accidental or due to inadvertance or that it is just and equitable to grant relief, may make an order extending the time for delivery of the document for such period as the court may think proper. 

COMMISSIONS AND DISCOUNTS, ETC

POWER TO PAY CERTAIN COMMISSIONS, AND PROHIBITION OF PAYMENT OF ALL OTHER COMMISSIONS, DISCOUNTS, ETC.

65.  (1) It shall be lawful for a company to pay a commission to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any shares in the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares in the company if –

(a) the payment of the commission is authorised by the articles; and

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(b)

the commission paid or agreed to be paid does not exceed 10 per cent of the price at which the shares are issued or the amount or rate authorised by the articles, whichever is the less; and

(c)

the amount or rate per cent of the commission paid or agreed to be paid is 

(i)

in the case of shares offered to the public for subscription, disclosed in the prospectus; or

(ii)

in the case of shares not offered to the public for subscription, disclosed in a statement signed by at least two directors of the company and delivered before the payment of the commission to the registrar of companies for registration, and, where a circular or notice, not being a prospectus, inviting subscription for the shares is issued, also disclosed in that circular or notice; and

(d)

the number of shares which persons have agreed for a commission to subscribe absolutely is disclosed in manner aforesaid. 

(2)

Save as aforesaid, no company shall apply any of its shares or capital money either directly or indirectly in payment of any commission, discount or allowance to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any shares in the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares in the company, whether the shares or money be so applied by being added to the purchase money of any property acquired by the company or to the contract price of any work to be executed for the company, or the money be paid out of the nominal purchase money or contract price, or otherwise. 

(3)

Nothing in this section shall affect the power of any company to pay such brokerage as it has heretofore been lawful for a company to pay. 

(4)

A vendor to, promoter of, or other person who receives payment in money or shares from, a company shall have and shall be deemed always to have had power to apply any part of the money or shares so received in payment of any commission, the payment of which, if made directly by the company, would have been legal under this section. 

(5)

If default is made in complying with the provisions of this section relating to the delivery to the registrar of the statement, the company and every officer of the company who is in default shall be liable to a fine not exceeding VT5,000. 

PROHIBITION OF PROVISION OF FINANCIAL ASSISTANCE BY COMPANY FOR PURCHASE OF OR SUBSCRIPTION FOR ITS OWN, OR ITS HOLDING COMPANY'S, SHARES

66.  (1) Subject as provided in this section, it shall not be lawful for a company to give, whether directly or indirectly, and whether by means of a loan, guarantee, the provision of security or otherwise, any financial assistance for the purpose of or in connection with a purchase or subscription made or to be made by any person of or for any shares in the company, or, where the company is a subsidiary company, in its holding company:

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

Provided that nothing in this section shall be taken to prohibit 

(a)

where the lending of money is part of the ordinary business of a company, the lending of money by the company in the ordinary course of its business;

(b)

the provision by a company, in accordance with any scheme for the time being in force, of money for the purchase of, or subscription for, fullypaid shares in the company or its holding company, being a purchase or subscription by trustees of or for shares to be held by or for the benefit of employees of the company, including any director holding a salaried employment or office in the company;

(c)

the making by a company of loans to persons, other than directors, bona fide in the employment of the company with a view to enabling those persons to purchase or subscribe for fullypaid shares in the company or its holding company to be held by themselves by way of beneficial ownership. 

(2) If a company acts in contravention of this section, the company and every officer of the company who is in default shall be liable to a fine not exceeding VT500,000. 

CONSTRUCTION OF REFERENCES TO OFFERING SHARES OR DEBENTURES TO THE PUBLIC

CONSTRUCTION OF REFERENCES TO OFFERING SHARES OR DEBENTURES TO THE PUBLIC

67.  (1) Any reference in this Act to offering shares or debentures to the public shall, subject to any provision to the contrary contained therein, be construed as including a reference to offering them to any section of the public, whether selected as members or debenture holders of the company concerned or as clients of the person issuing the prospectus or in any other manner, and references in this Act or in a company's articles to invitations to the public to subscribe for shares or debentures shall, subject as aforesaid, be similarly construed. 

(2) Subsection (1) shall not be taken as requiring any offer or invitation to be treated as made to the public if it can properly be regarded, in all the circumstances, as not being calculated to result, directly or indirectly, in the shares or debentures becoming available for subscription or purchase by persons other than those receiving the offer or invitation, or otherwise as being a domestic concern of the persons making and receiving it, and in particular 

(a)

a provision in a company's articles prohibiting invitations to the public to subscribe for shares or debentures shall not be taken as prohibiting the making to members or debenture holders of an invitation which can properly be regarded as aforesaid; and

(b)

the provisions of this Act relating to private companies shall be construed accordingly. 

ISSUE OF SHARES AT PREMIUM AND DISCOUNT AND REDEEMABLE PREFERENCE SHARES

APPLICATION OF PREMIUMS RECEIVED ON ISSUE OF SHARES

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

68.  (1) Where a company issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those shares shall be transferred to an account, to be called "the share premium account", and the provisions of this Act relating to the reduction of the share capital of a company shall, except as provided in this section, apply as if the share premium account were paid up share capital of the company. 

(2) The share premium account may, notwithstanding anything in subsection (1), be applied by the company in paying up unissued shares of the

company to be issued to members of the company as fully paid bonus

shares, in writing off –

(a)

the preliminary expenses of the company; or

(b)

the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company;

or in providing for the premium payable on redemption of any redeemable preference shares or of any debentures of the company. 

(3) Where a company has before the commencement of this Act (27 October 1986), issued any shares at a premium, this section shall apply as if the shares had been issued on or after that date:

Provided that any part of the premiums which has been so applied that it does not at the commencement of this Act (27 October 1986), form an identifiable part of the company's reserves within the meaning of Schedule 6 shall be disregarded in determining the sum to be included in the share premium account. 

PROHIBITION ON ALLOTMENT OF SHARES AT A DISCOUNT

69.  (1) It shall not be lawful for a company to allot or issue shares at a discount. 

(2) Where shares are allotted in contravention of subsection (1), the allottee shall be liable to pay to the company an amount equal to the discount, together with interest at the rate of 10 per cent per annum, and the directors who were privy to the making of the allotment shall be jointly and severally liable to the company for any loss it sustains. 

POWER TO ISSUE REDEEMABLE PREFERENCE SHARES

70.  (1) Subject to the provisions of this section, a company limited by shares may, if so authorised by its articles, issue preference shares which are, or at the option of the company are to be liable, to be redeemed:

Provided that 

(a) no such shares shall be redeemed except out of profits of the company which would otherwise be available for dividend or out of the proceeds of a fresh issue of shares made for the purposes of the redemption;

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES

[CAP. 191. 

(b)

no such shares shall be redeemed unless they are fully paid;

(c)

the premium, if any, payable on redemption, must have been provided for out of the profits of the company or out of the company's share premium account before the shares are redeemed;

(d)

where any such shares are redeemed otherwise than out of the proceeds of a fresh issue, there shall out of profits which would otherwise have been available for dividend be transferred to a reserve fund, to be called "the capital redemption reserve fund", a sum equal to the nominal amount of the shares redeemed, and the provisions of this Act relating to the reduction of the share capital of a company shall, except as provided in this section, apply as if the capital redemption reserve fund were paidup capital of the company. 

(2)

Subject to the provisions of this section, the redemption of preference shares thereunder may be effected on such terms and in such manner as may be provided by the articles of the company. 

(3)

The redemption of preference shares under this section by a company shall not be taken as reducing the amount of the company's authorised share capital. 

(4)

Where in pursuance of this section a company has redeemed or is about to redeem any preference shares, it shall have power to issue shares up to the nominal amount of the shares redeemed or to be redeemed as if those shares had never been issued, and accordingly the share capital of the company shall not for the purposes of any enactments relating to stamp duty be deemed to be increased by the issue of shares in pursuance of this subsection:

Provided that, where new shares are issued before the redemption of the old shares, the new shares shall not, so far as relates to stamp duty, be deemed to have been issued in pursuance of this subsection unless the old shares are redeemed within 1 month after the issue of the new shares. 

(5)

The capital redemption reserve fund may, notwithstanding anything in this section, be applied by the company in paying up unissued shares of the

company to be issued to members of the company as fully paid bonus

shares. 

MISCELLANEOUS PROVISIONS AS TO SHARE CAPITAL

 POWER OF COMPANY TO ARRANGE FOR DIFFERENT AMOUNTS BEING PAID ON SHARES

71.  A company, if so authorised by its articles, may do any one or more of the following things

(a) make arrangements on the issue of shares for a difference between the shareholders in the amounts and times of payment of calls on their shares;

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

(b)

accept from any member the whole or a part of the amount remaining unpaid on any shares held by him, although no part of that amount has been called up;

(c)

pay dividend in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others. 

POWER OF COMPANY LIMITED BY SHARES TO ALTER ITS SHARE CAPITAL

72.  (1) A company limited by shares, if so authorised by its articles, may alter the conditions of its memorandum as follows, that is to say, it may 

(a)

increase its share capital by new shares of such amount as it thinks expedient;

(b)

consolidate and divide all or any of its share capital into shares of larger amount than its existing shares;

(c)

convert all or any of its paidup shares into stock, and reconvert that stock into paidup shares of any denomination; 

(d)

subdivide its shares, or any of them, into shares of smaller amount than is fixed by the memorandum, so, however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as

it was in the case of the share from which the reduced share is

derived;

(e) cancel shares which, at the date of the passing of the resolution in that behalf, have not been taken or agreed to be taken by any person, and diminish the amount of its share capital by the amount of the shares so cancelled. 

(2)

The powers conferred by this section must be exercised by the company in general meeting. 

(3)

A cancellation of shares in pursuance of this section shall not be deemed to be a reduction of share capital within the meaning of this Act. 

NOTICE TO REGISTRAR OF CONSOLIDATION OF SHARE CAPITAL, CONVERSION OF SHARES INTO STOCK, ETC. 

73.  (1) If a company having a share capital has 

(a)

consolidated and divided its share capital into shares of larger amount than its existing shares; or

(b)

converted any shares into stock; or

(c)

reconverted stock into shares; or

(d)

subdivided its shares or any of them; or

(e)

redeemed any redeemable preference shares; or

(f)

cancelled any shares, otherwise than in connection with a reduction of share capital under section 75, 

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

it shall within 1 month after so doing give notice thereof to the registrar of companies specifying, as the case may be, the shares consolidated, divided, converted, subdivided, redeemed or cancelled, or the stock reconverted. 

(2) If default is made in complying with this section, the company and every officer of the company who is in default shall be liable to a default fine. 

NOTICE OF INCREASE OF SHARE CAPITAL

74.	(1)	Where a company having a share capital, whether its shares have or have
		not been converted into stock, has increased its share capital beyond the
		registered		capital,		it		shall,			within			15	days				after			the		passing				of	the
		resolution		authorising the					increase, give							to		the			registrar				of	companies
		notice of the increase, and the registrar shall record the increase.
	(2)	The notice to be given as aforesaid shall include such particulars as may
		be	prescribed		with		respect			to		the	classes				of			shares			affected				and			the
		conditions subject to which the new shares have been or are to be issued,
		and there shall be forwarded to the registrar of companies together with
		the notice a printed copy, or a copy in some other form approved by the
		registrar, of the resolution authorising the increase.
	(3)	If default is made in complying with this section, the company and every
		officer of the company who is in default shall be liable to a default fine.

REDUCTION OF SHARE CAPITAL

SPECIAL RESOLUTION FOR REDUCTION OF SHARE CAPITAL

75.  (1) Subject to confirmation by the court, a company limited by shares may, if so authorised by its articles, by special resolution reduce its share capital in any way, and in particular, without prejudice to the generality of the foregoing power, may 

(a)

extinguish or reduce the liability on any of its shares in respect of share capital not paid up; or

(b)

either with or without extinguishing or reducing liability on any of its shares, cancel any paidup share capital which is lost or unrepresented by available assets; or

(c)

either with or without extinguishing or reducing liability on any of its shares, pay off any paidup share capital which is in excess of the wants of the company;

and may, if and so far as is necessary, alter its memorandum by reducing the amount of its share capital and of its shares accordingly. 

(2) A special resolution under this section is in this Act referred to as "a resolution for reducing share capital". 

LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

APPLICATION TO COURT FOR CONFIRMING ORDER, OBJECTIONS BY CREDITORS, AND SETTLEMENT OF LIST OF OBJECTING CREDITORS

76.  (1) Where a company has passed a resolution for reducing share capital, it may apply to the court for an order confirming the reduction. 

(2)

Where the proposed reduction of share capital involves either diminution of liability in respect of unpaid share capital or the payment to any shareholder of any paidup share capital, and in any other case if the court so directs, the following provisions shall have effect, subject nevertheless to subsection (3) 

(a)

every creditor of the company who at the date fixed by the court is entitled to any debt or claim which, if that date were the commencement of the winding up of the company, would be admissible in proof against the company, shall be entitled to object to the reduction;

(b)

the court shall settle a list of creditors so entitled to object, and for that purpose shall ascertain, as far as possible without requiring an application from any creditor, the names of those creditors and the nature and amount of their debts or claims, and may publish notices fixing a day or days within which creditors not entered on the list are to claim to be so entered or are to be excluded from the right of objecting to the reduction;

(c)

where a creditor entered on the list whose debt or claim is not discharged or has not determined does not consent to the reduction, the court may, if it thinks fit, dispense with the consent of that creditor, on the company securing payment of his debt or claim by appropriating, as the court may direct, the following amount 

(i)

if the company admits the full amount of the debt or claim, or, though not admitting it, is willing to provide for it, then the full amount of the debt or claim;

(ii)

if the company does not admit and is not willing to provide for the full amount of the debt or claim, or if the amount is contingent or not ascertained, then an amount fixed by the court after the like enquiry and adjudication as if the company were being wound up by the court. 

(3)

Where a proposed reduction of share capital involves either the diminution of any liability in respect of unpaid share capital or the payment to any

shareholder of any paidup share capital, the court may, if, having regard to any special circumstances of the case, it thinks proper so to do, direct that subsection (2) shall not apply as regards any class or any classes of creditors. 

ORDER CONFIRMING REDUCTION AND POWERS OF COURT ON MAKING SUCH ORDER

77.  The court, if satisfied, with respect to every creditor of the company who under section 76 is entitled to object to the reduction, that either his consent to the reduction has been obtained or his debt or claim has been discharged or has determined, or has been secured, may make an order confirming the reduction on such terms and conditions as it thinks fit. 

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REGISTRATION OF ORDER AND MINUTE OF REDUCTION

78.	(1)	The registrar of companies, on production to him of an order of the court
		confirming		the		reduction		of			the	share			capital	of		a	company,				and			the
		delivery to him of a copy of the order and of a minute approved by the
		court showing, with respect to the share capital of the company as altered
		by the order, the amount of the share capital, the number of shares into
		which it is to be divided, and the amount of each share, and the amount, if
		any, at the date of the registration deemed to be paid up on each share,
		shall register the order and minute.
	(2)	On the registration of the order and minute, and not before, the resolution
		for reducing share capital							as		confirmed by the order									so	registered shall
		take effect.
	(3)	Notice of the registration shall be published in such manner as the court
		may direct.
	(4)	The registrar shall certify under his hand the registration of the order and
		minute,	and		his		certificate			shall			be	conclusive			evidence					that		all	the
		requirements of this Act with respect to reduction of share capital have
		been complied with, and that the share capital of the company is such as is
		stated in the minute.

(5)

The minute when registered shall be deemed to be substituted for the corresponding part of the memorandum, and shall be valid and alterable as if it had been originally contained therein. 

(6)

The substitution of any such minute as aforesaid for part of the memorandum of the company shall be deemed to be an alteration of the memorandum within the meaning of section 35. 

LIABILITY OF MEMBERS IN RESPECT OF REDUCED SHARES

79.  (1) In the case of a reduction of share capital, a member of the company, past or present, shall not be liable in respect of any share to any call or contribution exceeding in amount the difference, if any, between the amount of the share as fixed by the minute and the amount paid, or the reduced amount, if any, which is to be deemed to have been paid, on the share, as the case may be:

Provided that, if any creditor, entitled in respect of any debt or claim to object to the reduction of share capital, is, by reason of his ignorance of the proceedings for reduction, or of their nature and effect with respect to his claim, not entered on the list of creditors, and, after the reduction, the company is unable, within the meaning of the provisions of this Act with respect to winding up by the court, to pay the amount of his debt or claim, then 

(a)

every person, who was a member of the company at the date of the registration of the order for reduction and minute, shall be liable to contribute for the payment of that debt or claim an amount not exceeding the amount which he would have been liable to contribute if the company had commenced to be wound up on the day before the said date; and

(b)

if the company is wound up, the court, on the application of any such creditor and proof of his ignorance as aforesaid, may, if it thinks fit, settle accordingly a list of persons so liable to contribute, and make and enforce calls and orders on the contributories settled on the list, as if they were ordinary contributories in a winding up. 

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(2) Nothing in this section shall affect the rights of the contributories among themselves. 

PENALTY FOR CONCEALING NAME OF CREDITOR, ETC. 

80.  If any officer of the company

(a)

wilfully conceals the name of any creditor entitled to object to the

reduction; or

(b)

wilfully misrepresents the nature or amount of the debt or claim of any creditor; or

(c)

aids, abets or is privy to any such concealment or misrepresentation as aforesaid, he shall be liable to a fine not exceeding VT100,000. 

VARIATION OF SHAREHOLDERS, RIGHTS

RIGHTS OF HOLDERS OF SPECIAL CLASSES OF SHARES

81.  (1) If, in the case of a company the share capital of which is divided into different classes of shares, provision is made by the memorandum or articles for authorising the variation of the rights attached to any class of shares in the company, subject to the consent of any specified proportion of the holders of the issued shares of that class or the sanction of a resolution passed at a separate meeting of the holders of those shares, and in pursuance of the said provision the rights attached to any such class of shares are at any time varied, the holders of not less in the aggregate than 15 per cent of the issued shares of that class, being persons who did not consent to or vote in favour of the resolution for the variation, may apply to the court to have the variation cancelled, and, where any such application is made, the variation shall not have effect unless and until it is confirmed by the court. 

(2)

An application under this section must be made within 21 days after the date on which the consent was given or the resolution was passed, as the case may be, and may be made on behalf of the shareholders entitled to make the application by such one or more of their number as they may appoint in writing for the purpose. 

(3)

On any such application the court, after hearing the applicant and any other persons who apply to the court to be heard and appear to the court to be interested in the application, may, if it is satisfied, having regard to all the circumstances of the case, that the variation would unfairly prejudice the shareholders of the class represented by the applicant, disallow the variation and shall, if not so satisfied, confirm the variation. 

(4)

The decision of the court on any such application shall be final. 

(5)

The company shall within 15 days after the making of an order by the court on any such application forward a copy of the order to the registrar of companies, and, if default is made in complying with this provision, the company and every officer of the company who is in default shall be liable to a default fine. 

(6)

The expression "variation" in this section includes abrogation and the

expression "varied" shall be construed accordingly.

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TRANSFER OF SHARES AND DEBENTURES, EVIDENCE OF TITLE, ETC

NUMBERING OF SHARES

82.  Each share in a company having a share capital shall be distinguished by its appropriate number:

Provided that, if at any time all the issued shares in a company, or all the issued shares therein of a particular class, are fully paid up and rank pari passu for all purposes, none of those shares need thereafter have a distinguishing number so long as it remains fully paid up and ranks pari passu for all purposes with all shares of the same class for the time being issued and fully paid up. 

TRANSFER NOT TO BE REGISTERED EXCEPT ON PRODUCTION OF INSTRUMENT OF TRANSFER

83.  Notwithstanding anything in the articles of a company, it shall not be lawful for the company to register a transfer of shares in or debentures of the company unless a proper instrument of transfer has been delivered to the company:

Provided that nothing in this section shall prejudice any power of the company to register as shareholder or debenture holder any person to whom the right to any shares in or debentures of the company has been transmitted by operation of law. 

TRANSFER BY PERSONAL REPRESENTATIVE

1. A transfer of the share or other interest of a deceased member of a company made by his personal representative shall, although the personal representative is not himself a member of the company, be as valid as if he had been such a member at the time of the execution of the instrument of transfer. 
2. REGISTRATION OF TRANSFER AT REQUEST OF TRANSFEROR
1. On the application of the transferor of any share or interest in a company, the company shall enter in its register of members the name of the transferee in the same manner and subject to the same conditions as if the application for the entry were made by the transferee. 

NOTICE OF REFUSAL TO REGISTER TRANSFER

86.	(1)	If a company refuses to register a transfer of any shares or debentures, the
		company shall, within 2 months after the date on which the transfer was
		lodged with the company, send to the transferee notice of the refusal.
	(2)	If default is made in complying with this section, the company and every
		officer of the company who is in default shall be liable to a default fine.

CERTIFICATION OF TRANSFERS

87.  (1) The certification by a company of any instrument of transfer of shares in or debentures of the company shall be taken as a representation by the company to any person acting on the faith of the certification that there have been produced to the company such documents as on the face of them show a prima facie title to the shares or debentures in the transferor named in the

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instrument of transfer, but not as a representation that the transferor has any title to the shares or debentures. 

(2)

Where any person acts on the faith of a false certification by a company made negligently, the company shall be under the same liability to him as if the certification had been made fraudulently. 

(3)

For the purposes of this section 

(a)

an instrument of transfer shall be deemed to be certificated if it bears the words "certificate lodged" or words to the like effect;

(b)

the certification of an instrument of transfer shall be deemed to be made by a company if 

(i)

the person issuing the instrument is a person authorised to issue certificated instruments of transfer on the company's behalf; and

(ii)

the certification is signed by a person authorised to certificate transfers on the company's behalf or by any officer or servant either of the company or of a body corporate so authorised;

(c)

a certification shall be deemed to be signed by any person if 

(i)

it purports to be authenticated by his signature or initials (whether hand written or not); and

(ii)

it is not shown that the signature or initials was or were placed there neither by himself nor by any person authorised to use the signature or initials for the purpose of certificating transfers on the company's behalf. 

DUTIES OF COMPANY WITH RESPECT TO ISSUE OF CERTIFICATES

88.	(1)	Every company shall, within 2 months after the allotment of any of its
		shares, debentures or debenture stock and within 2 months after the date
		on which a transfer of any such shares, debentures or debenture stock is
		lodged with the company, complete and have ready for delivery the
		certificates of all shares, the debentures and the certificates of all
		debenture stock allotted or transferred, unless the conditions of issue of the
		shares, debentures or debenture stock otherwise provide.
		The expression "transfer" for the purpose of this subsection means a
		transfer duly stamped and otherwise valid, and does not include such a
		transfer as the company is for any reason entitled to refuse to register and
		does not register.
	(2)	If default is made in complying with this section, the company and every
		officer of the company who is in default shall be liable to a default fine.
	(3)	If any company on whom a notice has been served requiring the company
		to make good any default in complying with the provisions of subsection
		(1) fails to make good the default within 10 days after the service of the
		notice, the court may, on the application of the person entitled to have the
		certificates or the debentures delivered to him, make an order directing the
		company and any officer of the company to make good the default within
		such time as may be specified in the order, and any such order may
		provide that all costs of and incidental

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(4) to the application shall be borne by the company or by any officer of the company responsible for the default. 

CERTIFICATE TO BE EVIDENCE OF TITLE

1. A certificate, under the common seal of the company, specifying any shares held by any member, shall be prima facie evidence of the title of the member to the shares. 
2. EVIDENCE OF GRANT OF PROBATE
1. The production to a company of any document which is by law sufficient evidence of probate of the will, or letters of administration of the estate, or confirmation as executor, of a deceased person having been granted to some person shall be accepted by the company, notwithstanding anything in its articles, as sufficient evidence of the grant. 
2. ISSUE AND EFFECT OF SHARE WARRANTS TO BEARER
1. (1) A company limited by shares, if so authorised by its articles, may, with respect to any fully paidup shares, issue under its common seal a warrant stating that the bearer of the warrant is entitled to the shares therein specified, and may provide, by coupons or otherwise, for the payment of the future dividends on the shares included in the warrant. 
1. Such a warrant as aforesaid is in this Act termed a "share warrant". 
2. A share warrant shall entitle the bearer thereof to the shares therein specified, and the shares may be transferred by delivery of the warrant. 

PENALTY FOR PERSONATION OF SHAREHOLDER

92.  If any person falsely and deceitfully personates any owner of any share or interest in any company, or of any share warrant or coupon, issued in pursuance of this Act, and thereby obtains or endeavours to obtain any such share or interest or share warrant or coupon, or receives or endeavours to receive any money due to any such owner, as if the offender were the true and lawful owner, he shall on conviction thereof be liable to imprisonment for a term not exceeding 12 months or to a fine not exceeding VT200,000, or to both. 

SPECIAL PROVISIONS AS TO DEBENTURES

REGISTER OF DEBENTURE HOLDERS

93.  (1) A company which issues or has issued debentures in a series shall maintain a register of the holders thereof. 

(2) The provisions of sections 114 to 116 and 118 to 126 shall apply, with the appropriate modifications, to the register of debenture holders. 

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             COMPANIES [CAP. 191. 

(3)

A company shall, upon the demand of any trustee for debenture holders, within 7 days furnish to him the names, addresses and other particulars of such debenture holders appearing on such register, without charge. 

(4)

If a company contravenes subsection (3), the company and every officer of the company who is in default shall be liable to a default fine. 

RIGHTS OF INSPECTION OF REGISTER OF DEBENTURE HOLDERS AND TO COPIES OF REGISTER AND TRUST DEED

94.  (1) Every register of holders of debentures of a company shall, except when duly closed (but subject to such reasonable restrictions as the company may in general meeting impose, so that not less than 2 hours in each day shall be allowed for inspection), be open to the inspection of the registered holder of any such debentures or any holder of shares in the company without fee, and of any other person on payment of a fee of VT100 or such less sum as may be prescribed by the company. 

(2)

Any such registered holder of debentures or holder of shares as aforesaid or any other person may require a copy of the register of the holders of debentures of the company or any part thereof on payment of VT50, or such less sum as may be prescribed by the company, for every 100 words or fractional part thereof required to be copied. 

(3)

A copy of any trust deed for securing any issue of debentures shall be forwarded to every holder of any such debentures at his request on payment of VT50, or such less sum as may be prescribed by the company, for every 100 words or fractional part thereof required to be copied. 

(4)

If inspection is refused, or a copy is refused or not forwarded, the company and every officer of the company who is in default shall be liable to a default fine. 

(5)

Where a company is in default as aforesaid, the court may by order compel an immediate inspection of the register or direct that the copies required shall be sent to the person requiring them. 

(6)

For the purposes of this section, a register shall be deemed to be duly closed if closed in accordance with provisions contained in the articles or in the debentures or, in the case of debenture stock, in the stock certificates, or in the trust deed or other document securing the debentures or debenture stock, during such period or periods, not exceeding in the whole 30 days in any year, as may be therein specified. 

LIABILITY OF TRUSTEES FOR DEBENTURE HOLDERS

95.  (1) Subject to the following provisions of this section, any provision contained in a trust deed for securing an issue of debentures, or in any contract with the holders of debentures secured by a trust deed, shall be void in so far as it would have the effect of exempting a trustee thereof from or indemnifying him against liability for breach of trust where he fails to show the

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             COMPANIES [CAP. 191. 

degree of care and diligence required of him as trustee, having regard to the provisions of the trust deed conferring on him any powers, authorities or discretions. 

(2) Subsection (1) shall not invalidate 

(a)

any release otherwise validly given in respect of anything done or omitted to be done by a trustee before the giving of the release; or

(b)

any provision enabling such a release to be given

(i)

on the agreement thereto of a majority of not less than threefourths in value of the debenture holders present and voting in person or, where proxies are permitted, by proxy at a meeting summoned for the purpose; and

(ii)

either with respect to specific acts or omissions or on the trustee dying or ceasing to act. 

PERPETUAL DEBENTURES

96.  A condition contained in any debentures or in any deed for securing any debentures, whether issued or executed before or after the commencement of this Act (27 October 1986), shall not be invalid by reason only that the debentures are thereby made irredeemable or redeemable only on the happening of a contingency, however remote, or on the expiration of a period, however long, any rule of equity to the contrary notwithstanding. 

POWER TO REISSUE REDEEMED DEBENTURES IN CERTAIN CASES

97.	(1)	Where			either				before,				on	or		after				the			commencement								of		this			Act		(27
		October					1986),				a	company				has			redeemed					any			debentures							previously
		issued, then
		(a)	unless any provision to the contrary, whether express or implied, is
		contained in the articles																or			in any contract								entered into by the
		company; or
		(b)		unless the company has, by passing a resolution to that effect or by
		some other act, manifested its intention that the debentures shall be
		cancelled;
		the company shall have, and shall be deemed always to have had, power to
		reissue the debentures, either by reissuing the																								same				debentures							or		by
		issuing other debentures in their place.
	(2)	Subject				to		the		provisions					of		section					98, on			a			reissue				of			redeemed
		debentures the person entitled to the debentures shall have, and shall be
		deemed always to have had, the same priorities as if the debentures had
		never been redeemed.

(3)

Where a company has either before, on or after the commencement of this Act (27 October 1986), deposited any of its debentures to secure advances from time to time on current account or otherwise, the debentures shall not be deemed to have been redeemed by reason only of the account of the company having ceased to be in debit whilst the debentures remained so deposited. 

(3)

The reissue of a debenture or the issue of another debenture in its place under the power by this section given to, or deemed to have been possessed by, a company, whether the reissue

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(4) or issue was made before, on or after the commencement of this Act (27 October 1986), shall be treated as the issue of a new debenture for the purposes of stamp duty, but it shall not be so treated for the purposes of any provision limiting the amount or number of debentures to be issued:

Provided that any person lending money on the security of a debenture reissued under this section which appears to be duly stamped may give the debenture in evidence in any proceedings for enforcing his security without payment of the stamp duty or any penalty in respect thereof, unless he had notice or, but for his negligence, might have discovered, that the debenture was not duly stamped, but in any such case the company shall be liable to pay the proper stamp duty and penalty. 

SPECIFIC PERFORMANCE OF CONTRACTS TO SUBSCRIBE FOR DEBENTURES

1. A contract with a company to take up and pay for any debentures of the company may be enforced by an order for specific performance. 
2. PAYMENT OF CERTAIN DEBTS OUT OF ASSETS SUBJECT TO FLOATING CHARGE IN PRIORITY TO CLAIMS UNDER THE CHARGE
1. (1) Where either a receiver is appointed on behalf of the holders of any debentures of a company secured by a floating charge, or possession is taken by or on behalf of those debenture holders of any property comprised in or subject to the charge, then, if the company is not at the time in course of being wound up, the debts, which in every winding up are under the provisions of Part VI relating to preferential payments to be paid in priority to all other debts, shall be paid out of any assets coming to the hands of the receiver or other person taking possession as aforesaid in priority to any claim for principal or interest in respect of the debentures. 
1. In the application of the said provisions, section 308 shall be construed as if the provision for payment of accrued holiday remuneration becoming payable on the termination of employment before or by the effect of the winding up order or resolution were a provision for payment of such remuneration becoming payable on the termination of employment before or by the effect of the appointment of the receiver or possession being taken as aforesaid. 
2. The periods of time mentioned in the said provisions of Part VI shall be reckoned from the date of the appointment of the receiver or of possession being taken as aforesaid, as the case may be. 
3. Any payments made under this section shall be recouped as far as may be out of the assets of the company available for payment of general creditors. 

PART IV

REGISTRATION OF CHARGES

REGISTRATION OF CHARGES WITH REGISTRAR OF COMPANIES

REGISTRATION OF CHARGES CREATED BY COMPANIES

100. (1) Subject to the provisions of this Part of this Act, every charge created by a company and being a charge to which this section applies shall, so far as any security on the company's property or undertaking is conferred thereby, be void against the liquidator and any creditor LAWS OF THE REPUBLIC OF VANUATU

             COMPANIES [CAP. 191. 

of the company, unless the prescribed particulars of the charge together with the instrument, if any, by which the charge is created or evidenced, are delivered to or received by the registrar of companies for registration in manner required by this Act within 21 days after the date of its creation, but without prejudice to any contract or obligation for repayment of the money thereby secured and when a charge becomes void under this section the money secured thereby shall immediately become payable. 

(2)

This section applies to the following charges 

(a)

a charge for the purpose of securing any issue of debentures;

(b)

a charge on uncalled share capital of the company;

(c)

a charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale;

(d)

a charge on land, wherever situate, or any interest therein, but not including a charge for any rent or other periodical sum issuing out of land;

(e)

a charge on book debts of the company;

(f)

a floating charge on the undertaking or property of the company;

(g)

a charge on calls made but not paid;

(h)

a charge on a ship or any share in a ship;

(i)

a charge on goodwill, on a patent or a licence under a patent, on a trademark or on a copyright or a licence under a copyright. 

(3)

In the case of a charge created out of Vanuatu comprising property situate outside Vanuatu, the delivery to and the receipt by the registrar of a copy verified in the prescribed manner of the instrument by which the charge is created or evidenced shall have the same effect for the purposes of this section as the delivery and receipt of the instrument itself, and 21 days after the date on which the instrument or copy could, in due course of post, and if despatched with due diligence, have been received in Vanuatu shall be substituted for 21 days after the date of the creation of the charge as the

time within which the particulars and instrument or copy are to be delivered to the registrar.

(4)

Where a charge is created in Vanuatu but comprises property outside Vanuatu, the instrument creating or purporting to create the charge may be sent for registration under this section notwithstanding that further proceedings may be necessary to make the charge valid or effectual according to the law of the country in which the property is situate. 

(5)

Where a negotiable instrument has been given to secure the payment of any book debts of a company the deposit of the instrument for the purpose of securing an advance to the company shall not, for the purposes of this section, be treated as a charge on those book debts. 

(6)

The holding of debentures entitling the holder to a charge on land shall not for the purposes of this section be deemed to be an interest in land. 

(7)

Where a series of debentures containing, or giving by reference to any other instrument, any charge to the benefit of which the debenture holders of that series are entitled pari passu is created by a company, it shall, for the purposes of this section, be sufficient if there are delivered to or received by the registrar, within 21 days after the execution of the deed

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             COMPANIES [CAP. 191. 

containing the charge or, if there is no such deed, after the execution of any debentures of the series, the following particulars 

(a)

the total amount secured by the whole series; and

(b)

the dates of the resolutions authorising the issue of the series and the date of the covering deed, if any, by which the security is created or defined; and

(c)

a general description of the property charged; and

(d)

the names of the trustees, if any, for the debenture holders;

together with the deed containing the charge, or, if there is no such deed, one of the debentures of the series:

Provided that, where more than one issue is made of debentures in the series, there shall be sent to the registrar for entry in the register particulars of the date and amount of each issue, but an omission to do this shall not affect the validity of the debentures issued. 

(8) Where any commission, allowance or discount has been paid or made either directly or indirectly by a company to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any debentures of the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any such debentures, the particulars required to be sent for registration under this section shall include particulars as to the amount or rate per cent of the commission, discount or allowance so paid or made, but omission to do this shall not affect the validity of the debentures issued:

Provided that the deposit of any debentures as security for any debt of the company shall not, for the purposes of this subsection, be treated as the issue of the debentures at a discount. 

CHARGES TO SECURE FLUCTUATING AMOUNTS

101.  Where a charge, particulars of which require registration under section 100, is expressed to secure all sums due or to become due or some other uncertain or fluctuating amount, the particulars required under paragraph (a) of subsection (7) of the said section 100 shall state the maximum sum deemed to be secured by such charge, being the maximum capital sum covered by the stamp duty paid by the grantee, and such charge shall be void, so far as any security on the property of the company is thereby conferred, as respects any excess over the stated maximum:

Provided that if –

(a)

additional stamp duty is subsequently paid on such charge or the grantee shall certify in writing that the maximum sum secured thereby has been increased; and

 (b)

at any time thereafter prior to the commencement of the winding up of the company amended particulars of the said charge stating the increased maximum sum deemed to be secured thereby, together with the original instrument by which the charge was created or evidenced, are delivered to the registrar for registration, 

then, as from the date of such delivery the charge, if otherwise valid, shall be effective to the extent of such increased maximum sum except as regards any person who, prior to the date of such

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delivery, has acquired any proprietary rights in, or a fixed or floating charge on, the property subject to the charge. 

DUTY OF COMPANY TO REGISTER CHARGES CREATED BY THE COMPANY

102.  (1) It shall be the duty of a company to send to the registrar of companies for registration the particulars of every charge created by the company and of the issues of debentures of a series requiring registration under the said section 100, but registration of any such charge may be effected on the application of any person interested therein. 

(2) If any company makes default in sending to the registrar for registration the particulars of any charge created by the company or of the issues of debentures of a series requiring registration as aforesaid, then, unless the registration has been effected on the application of some other person, the company and every officer of the company who is in default shall be liable to a default fine of VT10,000. 

DUTY OF COMPANY TO REGISTER CHARGES EXISTING ON PROPERTY ACQUIRED

103.  (l) Where a company acquires any property which is subject to a charge of any such kind as would, if it had been created by the company after the acquisition of the property, have been required to be registered under this Part, the company shall cause the prescribed particulars of the charge, together with a copy (certified in the prescribed manner to be a correct copy) of the instrument, if any, by which the charge was created or is evidenced, to be delivered to the registrar of companies for registration in manner required by this Act within 21 days after the date on which the acquisition is completed:

Provided that, if the property is situate and the charge was created outside Vanuatu, 21 days after the date on which the copy of the instrument could in due course of post, and if despatched with due diligence, have been received in Vanuatu shall be substituted for 21 days after the completion of the acquisition as the time within which the particulars and the copy of the instrument are to be delivered to the registrar. 

(2) If default is made in complying with this section, the company and every officer of the company who is in default shall be liable to a default fine of VT10,000. 

REGISTER OF CHARGES TO BE KEPT BY REGISTRAR

104.  (1) The registrar shall keep, with respect to each company, a register in the prescribed form of all the charges requiring registration under this Part of this Act, and shall enter in the register with respect to such charges the following particulars 

(a)

in the case of a charge to the benefit of which the holders of a series of debentures are entitled, such particulars as are specified in section 100(7);

(b)

in the case of any other charge 

(i) if the charge is a charge created by the company, the date of its creation, and if the charge was a charge existing on property acquired by the company, the date of the acquisition of the property; and

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(ii) the amount secured by the charge; and

(iii) short particulars of the property charged; and

(iv) the persons entitled to the charge. 

(2)

The registrar shall give a certificate under his hand or seal of the registration of any charge registered in pursuance of this Part, stating the amount thereby secured, and the certificate shall be conclusive evidence that the requirements of this Part as to registration have been complied with. 

(3)

The register kept in pursuance of this section shall be open to inspection by any person on payment of such fee, not exceeding VT100 for each inspection, as may be prescribed by rules made by the Minister. 

ENDORSEMENT OF CERTIFICATE OF REGISTRATION ON DEBENTURES

105.  (1) The company shall cause a copy of every certificate of registration given under section 104 to be endorsed on every debenture or certificate of debenture stock which is issued by the company and the payment of which is secured by the charge so registered:

Provided that nothing in this subsection shall be construed as requiring a company to cause a certificate of registration of any charge so given to be endorsed on any debenture or certificate of debenture stock issued by the company before the charge was created. 

(2) If any person knowingly and wilfully authorises or permits the delivery of any debenture or certificate of debenture stock which under the provisions of this section is required to have endorsed on it a copy of a certificate of registration without the copy being so endorsed upon it, he shall, without prejudice to any other liability, be liable to a fine not exceeding VT20,000.

ENTRIES OF SATISFACTION AND RELEASE OF PROPERTY FROM CHARGE

106.  The registrar of companies, on evidence being given to his satisfaction with respect to any registered charge

(a)

that the debt for which the charge was given has been paid or satisfied in whole or in part; or

(b)

that part of the property or undertaking charged has been released from the charge or has ceased to form part of the company's property or undertaking;

may enter on the register a memorandum of satisfaction in whole or in part, or of the fact that part of the property or undertaking has been released from the charge or has ceased to form part of the company's property or undertaking, as the case may be, and where he enters a memorandum of satisfaction in whole he shall, if required, furnish the company with a copy thereof.

RECTIFICATION OF REGISTER OF CHARGES

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1. The court, on being satisfied that the omission to register a charge within the time required by this Act or that the omission or misstatement of any particular with respect to any such charge or in a memorandum of satisfaction was accidental, or due to inadvertence or to some other sufficient cause, or is not of a nature to prejudice the position of creditors or shareholders of the company, or that on other grounds it is just and equitable to grant relief, may, on the application of the company or any person interested, and on such terms and conditions as seem to the court just and expedient, order that the time for registration shall be extended, or, as the case may be, that the omission or misstatement shall be rectified. 
1. (1) If any person obtains an order for the appointment of a receiver or manager of the property of a company, or appoints such a receiver or manager under any powers contained in any instrument, he shall, within 7 days from the date of the order or of the appointment under the said powers, give notice of the fact to the registrar of companies, and the registrar shall enter the fact in the register of charges. 
1. Where any person appointed receiver or manager of the property of a company under the powers contained in any instrument ceases to act as such receiver or manager, he shall, on so ceasing, give the registrar of companies notice to that effect, and the registrar shall enter the notice in the register of charges. 
2. If any person makes default in complying with the requirements of this section, he shall be liable to a fine not exceeding VT1,000 for every day during which the default continues. 

REGISTRATION OF ENFORCEMENT OF SECURITY

PROVISIONS AS TO COPIES OF INSTRUMENTS CREATING CHARGES

COPIES OF INSTRUMENTS CREATING CHARGES TO BE KEPT BY COMPANY

109.  Every company shall cause a copy of every instrument creating any charge requiring registration under this Part of this Act to be kept at the registered office of the company:

Provided that, in the case of a series of uniform debentures, a copy of one debenture of the series shall be sufficient. 

RIGHT TO INSPECT COPIES OF INSTRUMENTS CREATING CHARGES

110.  (l) The copies of instruments creating any charge requiring registration under this Part shall be open during business hours (but subject to such reasonable restrictions as the company in general meeting may impose, so that not less than 2 hours in each day shall be allowed for inspection) to the inspection of any creditor or member of the company without fee. 

(2)

If inspection of the said copies is refused, every officer of the company who is in default shall be liable to a default fine. 

(3)

Upon any such refusal, the court may by order compel an immediate inspection of the copies or register. 

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APPLICATION OF PART IV TO COMPANIES INCORPORATED OUTSIDE VANUATU

APPLICATION OF PART IV TO CHARGES CREATED, AND PROPERTY SUBJECT TO CHARGE ACQUIRED, BY COMPANY INCORPORATED OUTSIDE VANUATU

111.  The provisions of this Part shall extend to charges on property in Vanuatu which are created, and to charges on property in Vanuatu which is acquired, by a company (whether a company within the meaning of this Act or not) incorporated outside Vanuatu which has an established place of business in Vanuatu. 

PART V

MANAGEMENT AND ADMINISTRATION

REGISTERED OFFICE AND NAME

REGISTERED OFFICE OF COMPANY

112.  (l) A company shall, as from the day on which it begins to carry on business or as from the fourteenth day after the date of its incorporation, whichever is the earlier, have a registered office in Vanuatu, to which all communications and notices must be addressed. 

(2)

Notice of the situation of the registered office, and of any change therein, shall be given within 14 days after the date of the incorporation of the company or of the change, as the case may be, to the registrar of companies, who shall record the same. 

The inclusion in the annual return of a company of a statement as to the address of its registered office shall not be taken to satisfy the obligation imposed by this subsection. 

(3)

Where under any provision of this Act any register, book of account or other document required by this Act to be kept by a company may be kept at a place other than the registered office of the company, the same shall be kept at some other premises situated in Vanuatu.

(4)

If default is made in complying with this section, the company and every officer of the company who is in default shall be liable to a default fine. 

PUBLICATION OF NAME BY COMPANY

113.  (1) Every company

(a)

shall paint or affix, and keep painted or affixed, its name on the outside of every office or place in which its business is carried on, in a conspicuous position, in letters easily legible;

(b)

shall have a common seal bearing its name in legible characters;

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(c) shall have its name mentioned in legible characters in all business letters of the company and in all notices and other official publications of the company, and in all bills of exchange, promissory notes, endorsements, cheques and orders for money or goods purporting to be signed by or on behalf of the company, and in all invoices, receipts and letters of credit of the company. 

(2)

If a company does not paint or affix its name in the manner directed by this Act, the company and every officer of the company who is in default shall be liable to a fine not exceeding VT10,000 and if a company does not keep its name painted or affixed in manner so directed, the company and every officer of the company who is in default shall be liable to a default fine. 

(3)

If a company fails to comply with paragraph (b) or paragraph (c) of subsection (1), the company shall be liable to a fine not exceeding VT10,000. 

(4)

If an officer of a company or any person on its behalf 

(a)

uses or authorises the use of any seal purporting to be a seal of the company which does not bear its name as aforesaid; or

(b)

issues or authorises the issue of any business letter of the company or any notice or other official publication of the company, or signs or authorises to be signed on behalf of the company any bill of exchange, promissory note, endorsement, cheque or order for money or goods wherein its name is not mentioned in manner aforesaid; or

(c)

issues or authorises the issue of any invoice, receipt or letter of credit of the company wherein its name is not mentioned in manner aforesaid;

he shall be liable to a fine not exceeding VT10,000, and shall further be personally liable to the holder of the bill of exchange, promissory note, cheque or order for money or goods for the amount thereof unless it is duly paid by the company.

REGISTER OF MEMBERS