Cameroon corporate law is largely based on the regulations of the Organization for the Harmonization of Business Law in Africa (OHADA), whereby 17 African countries largely converged their business, corporate and accounting laws.
Cameroon law does not expressly provide for the possibility to create a representative office. Nevertheless, it is possible to register a branch and apply for a declaration from the tax authorities to the effect that the branch undertaking mainly representative office tasks does not create a taxable presence in Cameroon. Pursuant to the revised OHADA rules, the branch must be converted into a subsidiary within 2 years of operations. The conversion obligation may be postponed by ministerial authorization for a similar period of 2 years but only once and only for companies subject to a “special regime”. Prior to the 2014 revision of the OHADA rules, the conversion obligation could be postponed by ministerial authorization multiple times and without the limitation to those entities benefitting from a “special regime”. Cameroon law provides for three main business forms, including:
A joint stock company (JSC) is a company whose capital is divided into shares between shareholders who are limited in liability in proportion to their contribution. They can be formed by natural persons or legal entities.
- Shareholders of a JSC can be natural persons or legal entities;
- No obligation to set nominal share value;
- Issued shares provide shareholder rights to company profits and net assets when wound up in proportion to each shareholders contribution unless the articles of association state otherwise;
- The Articles of Association must be formalized by notarized deed or private contract duration;
- If the articles of association are not in writing, the company will be considered a partnership;
- A registered office must be maintained; and
- The duration of the company cannot be for an indefinite period of time and must be set.
Private limited liability company's (LLC) formed in Cameroon provide limited liability for shareholders in proportion to their contribution. They can be formed by natural persons or legal entities.
- Shareholders of a private LLC can be natural persons or legal entities;
- The minimum registered capital is 1 million CFA francs;
- Share must be divided into equal value of not less than 5,000 CFA francs each;
- Registered capital must be paid in full upon incorporation;
- Shares may only be assigned with the consent of a majority of the non-transferring shareholders who hold at least 75% of the share capital excluding the shares to be transferred;
- In general, shares may be freely transferred between shareholder and to the family of shareholders, including spouse, ascendants, or descendants;
- Liability to losses of the company is limited to each shareholder's contribution; and
- Appointed managers have authority to act on behalf of the company.
A public limited company (PLC) is similar to an LLC in terms of liability, however, they are able to offer shares publicly and have greater capital and reporting requirements.
- A PLC may be formed by a single shareholder;
- In general a PLC must have a board of directors with at least 3 board members and a maximum of 12, or 24 in the event of a merger;
- PLCs with 3 or fewer shareholders may opt to appoint a managing director in lieu of forming a board of directors;
- Minimum authorized capital is 10 million CFA francs;
- Share must be divided into equal value of not less than 10,000 CFA francs each;
- Share of the company are freely negotiable;
- At least 25% of the face value of shares representing contributions in cash must be paid during capital subscription, and contributions in kind must be made in full;
- The Articles of Association of the company may be entered upon the rolls of deeds of a notary or by a notarized deed; and
- An auditor in tenure and alternate auditor must be appointed.
Further information on the general investment, tax and regulatory regime about the country is available at the following external references: