186,000 Companies Deregistered For Failing To Submit Annual Returns

In a sweeping move, the Uganda Registration Service Bureau (URSB) has taken action to deregister a staggering 186,000 companies due to their failure to submit annual returns over a five-year period.

This decisive action aligns with Section 134(6) of the Companies Act, 2012, which stipulates that companies consistently neglecting to file annual returns for five consecutive years may be removed from the official register.

The URSB initially issued a notice on March 20, 2023, instructing all companies to furnish their annual returns by April 20, 2023. Unfortunately, a significant number of companies did not adhere to the directive. As a result, on August 14, 2023, these non-compliant entities were officially deregistered.

The implications of deregistration are profound: these companies are no longer recognized as legal entities permitted to engage in business activities within Uganda. Furthermore, they could potentially face a fine of 25 currency points, which amounts to approximately 500,000 Ugandan shillings.

Mercy Kainobwisho, the URSB registrar, underscored the necessity of these deregistration’s in maintaining an ecosystem of active and compliant companies. She emphasized that ongoing monitoring will be conducted to ensure continued adherence to regulatory standards.

Concurrently with the deregistrations, the URSB issued a stern warning to dormant companies that have remained inactive for at least two years.

These dormant entities are obligated to inform the Bureau within 15 working days of attaining dormant status. Failure to meet this requirement could result in their deregistration as well.

This substantial deregistration event holds significance within Uganda’s business framework. It serves as a stark reminder to all companies about the imperative nature of legal compliance for maintaining registration status. The event accentuates the pivotal role of timely submission of annual returns.

The URSB serves is responsible for registering trademarks, business names, and companies in Uganda.The Companies Act, 2012 stands as the principal legislation overseeing companies within Uganda.