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Topic: Doing business in the CEMAC Region and Cameroon: The Role of the Lawyer in the Region.

By Neneng Yannick,

Managing Partner, Neneng Law Office,

Douala, Cameroon.

 

  1. What is CEMAC?

The Central African Economic and Monetary Community (CEMAC), is a regional integration made up of six Central African States; Cameroon, Chad, Central African Republic, Gabon, Equatorial Guinea and the Republic of Congo. Its main objectives are to promote trade, institution of a genuine common market, creating greater solidarity among its people and toward under privileged countries and regions. The region has a common Bank of Central African States (BEAC), with the Francs CFA as a means of legal tender. Its banking institution is governed by the Central African Banking Commission (COBAC) and the financial market controlled and supervised by the Central African Financial Market Surveillance Commission (COSUMAF).

 

  1. Doing Business in the CEMAC Region; the OHADA Harmonized Business Laws.

Doing business in the CEMAC region, is governed by the harmonized OHADA business laws also referred to as Uniform Acts. What is OHADA? It is a French acronym that stands for the organization for the harmonization of business laws in Africa which are the main legal norms governing economic activities in the whole of the CEMAC region and Francophone Africa. OHADA is an intergovernmental organization for legal and economic integration established by the treat of 17 October 1993 as a result to address the economic inflation that plague most African economies in the early 90s. The organization brings together 17 African countries mostly of Francophone Africa and membership is open to any state of the African Union.

The harmonized OHADA business laws facilitate business activities within the CEMAC region and the whole of Francophone Africa. The OHADA business laws are contained in Uniform acts including;

The Uniform Act on General Commercial law, Uniform Act on Commercial Companies and Economic Interest groups, Uniform Act on Organizing Simplified recovery procedures and measures of execution, Uniform Act on Contracts of Carriage of goods by road, Uniform Act on Insolvency law, Uniform Act on Security law, Uniform Act relating to accounting law and financial information and the Uniform Act on Arbitration.

Irrespective of the Harmonized OHADA Uniform acts been the main legal norms governing economic activities in the region, member states do have internal guiding and governing policies, when it comes to doing business within their states.  For example;

The Chad has the National Investment Charter of 2008

There is the Cameroon Investment Code as revised 1990

The Central African Republic Investment Code of 2020

The Gabonese Investment Code of 1998

The Republic of Congo Investment code of 2002

And Law N° 7/1992 on the Investment regime of Equatorial Guinea.

Within the legal frameworks of these investment code of the member states of the CEMAC are two principle objectives;

Firstly, they act as guiding policies for both nationals and foreigners doing business within member states

Secondly, the spell out guidelines and investment opportunities attracting Foreign Direct Investment within member states.

Notwithstanding, within the framework of these investment codes, are existing structures within each member state such as the Investment Promotion Centers, that help advise the various governments on investment policies promoting trade in member states and within the region.

Also, we have other key agencies or institutions within member states responsible for the aspect of doing business such as;

The Ministry of Justice: Within its framework is responsible for criminal background checks on any investor be it national or foreigner filing to do business within any member state. Also, they are partially responsible for procedural aspect of corporate entities filing with the business registry.

Ministry of Finance: Doing business in the region, they are responsible for issuing tax clearance certificate also known as certificate of non- indebtedness likewise tax Identification numbers to businesses operating within member states.

Ministry of Commerce:  They are responsible for business registration within the framework of the OHADA Uniform act on commercial companies and economic interest groups within member states. This is supervised by the Trade and Personal Property Registry.

 

  1. The CEMAC Financial Market

Financial market is a vital aspect of any state economic when it comes to doing business. The Central African Economic and Monetary Community has a common Financial market, a Bank of Central African States, a common currency with the Central African Banking Commission (COBAC) which regulates the banking sector in the region.

Hence, the CEMAC Financial Market is controlled and supervised by the Central African Financial Market Surveillance Commission (COSUMAF), created within the framework of the Central African Monetary Union (UMAC). The Commission ensures the protection of savings invested in transferable securities and other financial instruments, information of investors, and the proper functioning of the Central African financial market. Within the framework of COSUMAF, the commission has

  1. Regulatory Capacity

The regulatory capacity of COSUMAF is demonstrated through the making of regulations, the adoption of instructions, circulars, opinions, recommendations and press releases.

  1. Decision taking

It gives COSUMAF the capacity to issue authorizations and approvals to players and operations such as Fintech companies to be admitted into the market stemming from banks and Fintech companies.

  1. Market surveillance

The power of the market surveillance enables COSUMAF to monitor the operations of the financial market with the aim of seeking stock market and Fintech offenses detecting any suspicious behavior.

  1. Sanction

The capacity to sanction allows COSUMAF to order the operations of any stakeholder contrary to regulations, to put an end to it or even suspend their activities.

 

  1. Doing Business in Cameroon.

We can’t talk of doing business in the CEMAC region without referencing doing business in Cameroon.

Cameroon economically, is the backbone and the gate way into the Central African Economic and Monetary Community. Doing business in Cameroon may be complex for foreign investors but can be flexible when you get the right information from the right source, likewise flexible compared to the other member states. This stem from;

  • Cameroon’s geographic Strategic position on the Gulf of Guinea
  • Its linguistic advantage of bilingualism over the other member states
  • Its legal system characterized of the civil and common law practices
  • And lastly a pace setter in the region when it comes to economic inclusion and innovation.

 

  1. The Cameroon Investment Code Verses the OHADA Uniform Acts

Since the 90s till date, the private sector, has been the backbone of the Cameroon economy. Doing business in Cameroon is guided by the Cameroon Investment Charter, which serves as a guide for the private sector to strive against the OHADA harmonized which governs and facilitates business activities. Taking into consideration the private sector as the backbone of the Cameroon economy, the Investment code act as a guide for nationals and foreign investors protecting rights such as;

  • Freedom to exercise an economic activity in Cameroon
  • Benefit of full protection of Cameroonian right
  • Free choice of legal procedure in dispute and Alternative Dispute Resolution
  • Enjoyment in respect of the laws and regulations enforce in terms of property (movable & immovable)
  • Free transfer out of Cameroon of revenue of every kind coming from capital invested
  • Free execution of contracts in terms of finance and commerce.

Doing business in Cameroon, the Cameroon investment code further provides opportunities to investors in the following sectors;

  • Mining Sector, Finance sector, Agricultural sector, Gas & Oil sector
  • Telecommunication & Technology sector, Health sector
  • Transportation sector, Entertainment sector, Tourism sector and a lot more.

 

  1. Key Aspects to Consider Doing Business in Cameroon
  • Immigration Policy

The Cameroon immigration policy is flexible, and gives room for temporary visit, long stay aliens and resident aliens in Cameroon. Entry visas into Cameroon is possible for transit visa (5 days), short stay visa (6 months), and long stay visa (not exceed 12 months). Depending on the objective of your business interaction in Cameroon.

  • Company incorporation

Business registration is a key aspect doing business in Cameroon, this is governed by the OHADA Uniform Act on commercial companies and economic interest groups which defines the status and the functioning of a business in Cameroon. Every existing company in Cameroon must be registered with the Trade & Personal Credit Registry in Cameroon to gain legal status.

  • Taxation

It is a vital aspect of every state’s economic, when it comes to revenue generating, hence an aspect of compliance for transactions and every business entity registered in Cameroon must comply accordingly with the Cameroon Tax Code which is reviewed and adopted by parliament annually. 

  • Employment and labor

Cameroon has a steady and available human resource work force in diverse space of the economy, regulated by the Cameroon Labor Code;

The law sets out the criteria for foreigners or expatriate to work in Cameroon

The law encourages and gives incentives to foreign companies that are able to provide massive employment for the local nationals.

  • The banking sector

The financial sector is key doing business in Cameroon. The banking sector is flexible with the Bank of Central African State (BEAC), The Central African Banking Commission with the present of about 20 Commercial Banks in the country facilitating cross border transactions likewise having good lending policies that support local businesses as well as foreign entities. With technology, Fintech inclusion has also made its way into the region with Cameroon been the pace setter.

  • Business environment

The business environment in Cameroon for a very long time has been very conducive until the Boko haram   terrorist activities in the FAR NORTH of the Country and the Anglophone Crisis in the North West and South west Region that pledge the country. Government security measures have been able to bring stability in these areas in the past few years. Away from that, you have the Douala seaport area of Cameroon which serves as a gateway for doing business in the CEMAC region. It is the largest industrial city in region of the CEMAC and a majority of domestic and foreign companies are established here for easy accessibility with the other member states.

 

  1. The Unique Role of a Lawyer in the Region.

The unique and most important aspect of the role of a lawyer in the region, I will say is; upholding the role of law protecting fundamental human rights. This stems from

  • Legal Advisory
  • Regulation & compliance
  • Business Incorporation
  • Administrative negotiations
  • Dispute management (litigation or in Alternative dispute resolution such as Arbitration and Mediation)
  • Legal representation (which could be in- house or outside counsel)

In a nutshell, doing business in Cameroon and the CEMAC region is welcoming conducive environment and flexible taken into consideration laws and regulations put in place by the member states to attract foreign direct investments. The unique role of a lawyer in the region is to uphold the role of law, protecting fundamental human rights in every sphere of the application of the law.