Ghanaian traders seem to be prepared for the worst. Ghana Union Traders Association (GUTA)has demanded the total closure of all retail shops belonging to foreigners by Monday, November 4, 2019, with claims that the government has not fulfilled its promise of ridding the market of such traders despite several appeals. GUTA has also dared the foreign traders whose retail shops have been closed so far to sue them if they feel they are being treated unfairly.
“What we are saying is that if they, in the first place , have flouted the laws, what is the beef if you also flout the laws? They should take us to court if they think what we are doing is not right. What they are doing is offending the law. When you look on and allow someone to come into your country without the recourse of obeying the laws of the land, do you sit down for the person to go on and break your laws?” he asked.
Here Is All You Need To Know
- The Ghana Union Traders Association (GUTA) has on several occasions complained about what they say is the collapse of their businesses due to the invasion of foreigners in the retail business.
- According to them, the activities of the foreigners breach the Ghana Investment Promotion Centre’s Act (Act 865).
- Citing the closure of the Nigerian border to protect its country from the smuggling of goods into their country, the Association said they will not tolerate the foreigners anymore, and demanded that their shops be closed down.
- The latest has been that the Association has begun serving foreign traders with notices demanding them to evacuate their shops, and have already locked up a few shops.
When questioned on Eyewitness News as to whether their move to close down such shops was legal, the Ashanti Regional Secretary of the Association, Daniel Owoahene Acheampong responded that the foreigners can decide to sue them if they ‘think what we are doing is not right”.
A Look At The Controversial Section 27(1) of Ghana’s Investment Promotion Act
According to Section 27 (1) of the GIPC Act, a person who is not a citizen or an enterprise which is not wholly-owned by a citizen shall not invest or participate in the sale of goods or provision of services in a market, petty trading or hawking or selling of goods in a stall at any place. The list of prohibited trading activities are:
- The sale of goods or provision of services in a market, petty trading or hawking or selling of goods in a stall at any place;
- The operation of taxi or car hire service in an enterprise that has a fleet of less than twenty-five vehicles;
- The operation of a beauty salon or a barbershop;
- The printing of recharge scratch cards for the use of subscribers of telecommunication services;
- The production of exercise books and other basic stationery; f. the retail of finished pharmaceutical products;
- The production, supply, and retail of sachet water;
- All aspects of pool betting business and lotteries, except football pool
Consequently, enterprises eligible for foreign participation and minimum foreign capital requirement are as follows:
A person who is not a citizen may participate in an enterprise other than an enterprise specified in section 27 if that person
- In the case of a joint enterprise with a partner who is a citizen, invests a foreign capital of not less than two hundred thousand United States dollars in cash or capital goods relevant to the investment or a combination of both by way of equity participation and
- The partner who is a citizen does not have less than ten percent equity participation in the joint enterprise; or
- Where the enterprise is wholly owned by that person, invests a foreign capital of not less than five hundred thousand United States dollars in cash or capital goods relevant to the investment or a combination of both by way of equity capital in the enterprise.
- A person who is not a citizen may engage in a trading enterprise if that person invests in the enterprise, not less than one million United States dollars in cash or goods and services relevant to the investments.
- For the purpose of this section, “trading” includes the purchasing and selling of imported goods and services.
- An enterprise referred to shall employ at least twenty skilled Ghanaians
Chase Away Foreigners?
GUTA President, in July 2019, said these confrontations are just actions by local retailers to preserve Ghana’s retail space and should not be seen as xenophobic attacks.
“We are going to declare the destiny day demonstration in three months, where all other laws will not be regarded if our pleas are not being noticed,” he said to the delight of the traders.
Same July, Ghana Union Traders Association President was quoted as insisting that if the Ghanaian government does not do as expected and the time comes for the demonstration, its members will not be stopped.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world