NAMIBIA Law and Practice Contributed by: Professor Michael Katz, Wolf Wohlers, Karin Malherbe and Stefanie Busch, ENS Namibia (incorporated as Lorentz Angula Inc.)
Listed Companies Listed companies are expected to comply with the NamCode on Corporate Governance, which recom - mends that boards should comprise a balance of executive and non-executive directors, with a major - ity of non-executive directors, the majority of whom should be independent. The NSX Listings Require - ments mandate that audit committees and nomina - tion committees should consist only of non-executive directors, of whom the majority must be independent. 3.4 Appointment and Removal of Directors/ Officers Section 225 of the Companies Act, 2004 disqualifies the following persons from being appointed or acting as a director of a company: • a body corporate; • a minor or any other person under legal disability; • any person who is the subject of any order under the Companies Act (or deemed to have been issued under the Companies Act) disqualifying them from being a director; • save under authority of the court: (a) an unrehabilitated insolvent; (b) any person removed from an office of trust on account of misconduct; (c) any person convicted of insider trading or any other fraud-on-the-market offence; or (d) any person convicted, whether in Namibia or elsewhere, of theft, fraud, forgery, uttering a forged document, perjury, corruption, or any offence involving dishonesty or connected with the promotion, formation or management of a company, and sentenced to imprison - ment without the option of a fine or to a fine of NAD1,000 or more. Any person who is disqualified from being appointed or acting as a director and who purports to act as a director, or who directly or indirectly takes part in or is concerned in the management of any company, commits an offence. Such person is liable to a fine not exceeding NAD8,000, or to imprisonment for a period not exceeding two years, or to both the fine and imprisonment.
Nothing in Section 225 prevents a company from pro - viding in its articles for any further disqualifications for the appointment of, or the retention of office by, any person as a director of that company. Removal of Directors A company may by ordinary resolution remove a director before the expiration of the director’s period of office, notwithstanding anything in its memoran - dum, articles or in any agreement between it and the director. In terms of Sections 194 and 228 of the Com - panies Act, 2004, special notice of not less than 28 days must be given to the company, and the director concerned is entitled to be heard and to make written representations. 3.5 Independence of Directors Independence Requirements The Companies Act, 2004 does not prescribe specific requirements for director independence. However, directors are required to disclose conflicts of interest. Conflicts of Interest In terms of Section 242 of the Companies Act, 2004, a director who is in any way, whether directly or indi - rectly, materially interested in a contract or proposed contract which is of significance in relation to the com - pany’s business must declare their interest and full particulars of the interest. The declaration must be made at or before the directors’ meeting at which the contract is first considered. Although a director who has declared such interest is not prohibited by the Companies Act, 2004 from voting on the matter, Namibian corporate governance best practice, as reflected in the NamCode, expects that an interested director will not vote on such con - tract. Usually, such director would recuse themselves from both the discussion and the decision. 3.6 Legal Duties of Directors/Officers Directors’ duties in Namibia arise from three principal sources, namely the Companies Act, 2004, the com - mon law and the company’s articles of association. Statutory Duties The Companies Act, 2004 imposes numerous specific duties on directors, including:
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