About Shelf Companies
What you should know…
A shelf company is a registered company that is inactive, having never traded or conducted business, holding no assets or liabilities, that is ready and available for purchase by those who wish to avoid the delay involved in incorporating a new company themselves. In Zimbabwe, shelf companies are registered as Private Limited Companies; the most popular company structure in Zimbabwe. This company structure is popular as the company exists as a separate legal entity from the individual owner.
This means the owners have limited financial liability, so their personal finances are protected if the company encounters financial problems.
Limited liability is a major benefit over the sole trader structure whereby the sole trader is liable for business debt. This page provides all of the need-to-know information about private limited companies
Benefits of a Shelf Company
- Getting new suppliers and contracts – An aged shelf company is already registered with the Companies and Intellectual Property (Previously Deeds, Companies and Intellectual Property; DCIP), and hence, it gives an image of longevity to your company. In other words, when you start your business, it often becomes difficult to secure the contracts because your company is relatively new. But, buying a shelf company to begin with business can help you gain instant trust from the suppliers because it promotes a more professional image.
- Easier approval of business banking – Running a business smoothly is equally vital as registering the company, and hence, business banking is an essential part of running the business. You are required to open a business bank account to build a professional image. It becomes a lot easier to approach any bank for credit cards and business account with the shelf company. It is because of the reason that banks are more inclined towards the older company to make investments.
- Boost up the client confidence – The most critical requirement for any business is to build the confidence of clients in the business because confidence and trust indeed play a crucial role in the success of the company. Research has shown that owning a shelf company can drastically boost the client’s confidence in the business because a shelf company gives an impression of longevity.
- Save your time – Shelf companies can potentially save a lot of your time because you aren’t required to register a company from scratch. When you start a business, time is indeed an essential factor that decides your business’s success. Buying a shelf company can drastically save time because the company is pre-registered. Hence, you can start your business the very day you buy the aged company.
- Bidding on government tendors – There are many government tendors that require a specific time in business for a company to bid on them, and buying a shelf company would provide your business with the necessary time in business. Hence, a shelf company can allow you to bid on government contracts very quickly.
Buying a Shelf Company
Buying a shelf company in Zimbabwe with Companies Made Easy is incredibly simple.
Here is what you need to know about the buying a shelf company:
- All Shelf Companies are registered as Private Limited Companies and must be legally registered with the Companies and Intellectual Property (former Deeds, Companies and Intellectual Property; DCIP), the official Registrar of Companies in Zimbabwe.
- It has a unique company name that has been approval and registered at the Companies and Intellectual Property.
- You must have a physical, postal and email address – these are the official addresses of the company which will appear on your CR 5. The physical address must be a full physical address (not a PO Box Number) and a Zimbabbwean address.
- You require a minimum of one shareholder and atleast two directors to register Private Limited Company. The same people can hold both positions.
- It has objectives included to describe the business activities that your company will engage in.
- On incorporation, the Deeds and Intellectual Property issued a memorandum of association to state the business objectives, names of the first shareholders (known as the ‘subscribers’) and their intention to form the company and take at least one share.
- A governing document called the articles of association must was adopted during the company incorporation process – this outlines the rules and regulation of the company.
Are you ready to buy a Shelf Company?
Frequently asked questions
What are the advantages of this type of company?
The most significant benefit of registering a Private Limited Company in Zimbabwe is limited liability for company shareholders. Their obligation to pay for business debts is restricted to the nominal value of their shares. This means their personal assets – property, car, finances etc. – are secure and cannot be used if the company becomes insolvent. Sole trader businesses do not have this benefit, and the owner is personally responsible for any business debts.
The other benefits of this type of business structure are enhanced professional status, and the ability to effectively plan your company’s finances to take advantage of any favourable tax rules
Who can own a Private Limited Company?
Any person or corporate body can own a Private Limited Company. The owners are known as ‘shareholders’, ‘members’ or ‘subscribers’ and they will appoint directors to run the day-to-day activities of the company. In many cases, the shareholders will also be directors in their company.
How many people are needed to register a Private Limited Company?
You must have at least one shareholder and atleast 2 directors but the same people can also hold both of these positions.
How do I register a Private Limited Company in Zimbabwe?
Companies Made Easy offers an easy company registration service – simply choose one of our Private Limited Company Packages that you need and complete our easy application form with details of your new company. We will prepare all the neccessary documantation and your company will be ready to trade in 7 – 9 working days.
What are the reporting and filing requirements do Private Limited Companies have?
Every Zimbabwean registered Private Limited Company is required to file an annual return and a declaration of annual general meeting to Companies Registry each year.
An annual return is a document containing details about your company at a certain date. This is used by the Companies Registry to confirm and maintain the accuracy of their records and the information that is displayed on public record.
Declaration of annual general meeting declares that a Private Limited Company has conducted its AGM as required by the Companies and Other Businesss Entities Act (Chapter 24:32).
You must also report any significant changes to your Private Limited Company to the Companies Registry.
Are you ready to register your company?
Companies Made Easy (Private) Limited. Registered in Zimbabwe at Hungwe House, 69 Jason Moyo, 1st Floor, North Wing, Harare, Zimbabwe
Tel: 0242 709 883
Mobile: 0786 507 151
Company Number: 19879/2021
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