BIPA clarifies the tender saga that involved a child

Martin Endjala

Namibia’s Business Intellectual Property Authority (BIPA) has clarified that the matter involving a five-year-old minor who is reported to be the majority shareholder of a company that won the pharmaceutical bidding via the Central Procurement Board of Namibia (CPBN) is within the corporate laws and that the corporate laws have not been broken.

In a recent response to Windhoek Observer questions on the matter, BIPA’s Spokesperson, Ockert Jansen, explained that pursuant to the provisions of both the Companies Act, 2004 and the Close Corporations Act, 1988, there exist no restrictions or exclusions concerning the age of an owner (in this context, specifically a member or shareholder).

“With respect to the case in question, Cospharm Investments (PTY) LTD, it is evident from the official records maintained by BIPA that the shareholding stands as follows, C. Mukaratirwa – 49 percent shareholding (a major male) and H.E. Mukaratirwa – 51 percent shareholding (a minor female)

Furthermore, it is noteworthy that C. Mukaratirwa is duly authorised to represent the minor female, and he also serves as the sole Director of the company,” Jansen said.

Taking into account the aforementioned, Jansen further explained that it is established that corporate law in Namibia does not preclude individuals of minor age from being designated as members or shareholders during the establishment of a legal entity.

Saying that it is universally acknowledged that, within the realm of corporate law, a minor may hold shares or possess a financial interest.

Jansen argued that this is a well-established principle in contract law that a minor may not independently enter into contracts, but in the event that such minors do hold shares or are party to contracts, they should, therefore, be represented by an adult of major age, acting as their curator ad bona (guardian), to act in their best interests.

Meanwhile, this comes after Finance Minister Iipumbu Shiimi, shifted the matter to BIPA saying that the matter is not a procurement issue (in this case CPBN) but that of the registrar of companies (BIPA).

Shiimi was responding to questions posed to him in parliament recently, by Popular Democratic Movement party member Nico Smit on the procurement of supply and delivery of pharmaceutical products for the Ministry of Health and Social Services.

“It is important for the public to note the following: First, the issue of the minor owning a company is not a procurement issue, but a company law matter.

“The right question we should therefore ask is whether or not it is right for minors to be allowed in terms of the Company’s Act to be shareholders in companies. The competent authority to answer this question is BIPA, not CPBN. Secondly, contrary to some reports, Cospharm didn’t enjoy any local preference because one shareholder, the child, is a Namibian,” said Shiimi.

He, however, explained that before the tender was open, foreign bidders and many other bidders participated.

He also explained that the pharmaceutical products are not produced in Namibia and therefore the reason to open up the tender to foreign suppliers was to get competitive prices and quality.

Consequently, Shiimi said, public resources will be used more sparingly, making it possible to ensure the availability of all needed medicines at all public medical facilities.

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