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Insolvency of companies in tz

Discussion in 'Jukwaa la Sheria (The Law Forum)' started by Madam Koku, Jun 23, 2009.

  1. Madam Koku

    Madam Koku Senior Member

    #1
    Jun 23, 2009
    Joined: Feb 16, 2009
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    Hi people,
    I would like to know generally if a company is wound up (any kind of winding up)due to insolvency in Tz, is there any legal way to protect the creditors? The status of employees for example, do they practicaly get their benefits? (i.e any kind of debts). What about big creditors like banks how are they protected?
    I am much interested in the practical part especialy at the curent situation where most of the companies are no longer under state ownership.
    Thanks.
     
  2. k

    kadorossa New Member

    #2
    Jul 6, 2009
    Joined: Aug 15, 2007
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    my dear
    im outside tanzania at the moment.it is important to know that first companies under the state are here by termed as public companies.but it seems to me that you are much interested into private companies governed by Cap 360, company Act as amended from time.shortly under insolvency i.e a company umable to realise its debts.then who may file bankrupcy?it either the company(voluntary bankrupcy) or the creditors (involuntary bankrupcy)here creditors are protected by law(referr to Cap 360) underwhich they may put the company under recevership and appoint their eceiver or put the company under administration...(note that this is a legal service provivded here, in the country that i am it is highly expensive.i here submit for the love of my people)
    thank you
     
  3. k

    kadorossa New Member

    #3
    Jul 6, 2009
    Joined: Aug 15, 2007
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    my dear
    im outside tanzania at the moment.it is important to know that first companies under the state are here by termed as public companies.but it seems to me that you are much interested into private companies governed by Cap 360, company Act as amended from time.shortly under insolvency i.e a company umable to realise its debts.then who may file bankrupcy?it either the company(voluntary bankrupcy) or the creditors (involuntary bankrupcy)here creditors are protected by law(referr to Cap 360) underwhich they may put the company under recevership and appoint their receiver or put the company under administration...so creditors are the number one to be protected, then shareholders with preferential shares etc(note that this is a legal service provivded here, in the country that i am it is highly expensive.i here submit for the love of my people)
    thank you
     
  4. Kang

    Kang JF-Expert Member

    #4
    Jul 7, 2009
    Joined: Jun 24, 2008
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    It depends on what type of creditor you are, Secured Creditors are considered first therefore if the company has any assets they get first consideration when it comes liquidation time, then the unsecured creditors get whatever if anything that is left.
    If the company has no assets at time of liquidation than tough luck no one gets anything.
    Employees are considered secured creditors as far as I can tell.

    Take a look at the Companies Act for details
    Link:http://www.parliament.go.tz/Polis/PAMS/Docs/12-2002.pdf
     
    Last edited: Jul 7, 2009
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