The State-Owned Enterprise Act, 2026

State-Owned Enterprises [No. 10 of 2026 417
THE STATE-OWNED ENTERPRISE ACT, 2026
ARRANGEMENT OF SECTIONS
PART I
PRELIMINARY PROVISIONS
Section
1. Short title and commencement
2. Interpretation
3. Non-application
4. Guiding principles
PART II
THE GOVERNMENT INVESTMENT DEPARTMENT
5. Government Investment Department
6. Director and other staff
PART III
INCORPORATION OF STATE-OWNED ENTERPRISES
7. Incorporation of state-owned enterprise
8. Incorporation, privatisation and winding up of
state-owned enterprise
9. Cessation of state shareholding
PART IV
SHAREHOLDER AND OWNERSHIP RIGHTS IN A STATE-OWNED
ENTERPRISE
10. Rights of shareholder in state-owned enterprise
11. Ownership rights of Minister in state-owned
enterprise that is exempt from incorporation
12. Shareholding and ownership of state-owned
enterprise
13. Holding company
PART V
GOVERNANCE OF STATE-OWNED ENTERPRISES
14. Responsibilities of Minister in governance of state-
owned enterprise
Single copies of this Act may be obtained from the Government Printer,
P.O. Box 30136, 10101, Lusaka, Price K100.00 each

ce of state-
owned enterprise
Single copies of this Act may be obtained from the Government Printer,
P.O. Box 30136, 10101, Lusaka, Price K100.00 each

15. Board of state-owned enterprise
16. Functions of board
17. Remuneration of directors
18. Chief executive officer
19. Secretary and other staff
20. Terms and conditions of appointment and remuneration
of chief executive officer, secretary and other staff
PART VI
FINANCIAL PROVISIONS AND DISCLOSURE
21. Financial year
22. Accounts and audit
23. Financial reporting
24. Quarterly reports
25. Publication of information
26. Request for information
PART VII
RECAPITALISATION, RESTRUCTURING, INVESTMENT AND DIVIDENDS
27. Recapitalisation of state-owned enterprise
28. Recapitalisation of subsidiary
29. Restructuring
30. Investment policy
31. Dividends and distributable annual net profit
PART VIII
PUBLIC INTEREST SERVICE OBLIGATION
32. Public interest service obligation
33. Transition to commercial viability
PART IX
COMPETITIVE NEUTRALITY
34. Non-discrimination and preferential treatment
35. Financing by Government
36. Exemption relating to non-discrimination and
preferential treatment
418 No. 10 of 2026] State-Owned Enterprises

atment
35. Financing by Government
36. Exemption relating to non-discrimination and
preferential treatment
418 No. 10 of 2026] State-Owned Enterprises

State-Owned Enterprises [No. 10 of 2026 419
PART X
MONITORING AND EVALUATION
37. Strategic and business plan of state-owned enterprise
38. Performance contract
39. Annual operating plan
40. Monitoring and evaluation of performance contract
PART XI
GENERAL PROVISIONS
41. Dissolution of board
42. Contraction of debt by state-owned enterprise
43. Exemption from provision of Act
44. Register
45. Publication of copies of register
46. Immunity
47. Offence by principal officers of body corporate or
unincorporate body
48. General offences
49. Guidelines
50. Regulations
51. Repeal of Cap. 408 and savings and transitional
provisions
SCHEDULES

ate or
unincorporate body
48. General offences
49. Guidelines
50. Regulations
51. Repeal of Cap. 408 and savings and transitional
provisions
SCHEDULES

An Act to establish the Government Investment Department
and provide for its functions; provide for the incorporation,
ownership and governance of state-owned enterprises;
provide for transparency and accountability in the
governance of state-owned enterprises; provide for the
undertaking of public interest service obligations by state-
owned enterprises; repeal the Self-Management
Enterprises Act, Cap. 408; and provide for matters
connected with, or incidental to, the foregoing.
[8th April, 2026
ENACTED by the Parliament of Zambia.
PART I
PRELIMINARY PROVISIONS
1. This Act may be cited as the State-owned Enterprises Act,
2026, and shall come into operation on the date appointed by the
Minister by statutory instrument.
2. In this Act, unless the context otherwise requires—
“annual accounts” has the meaning assigned to the words in
the Companies Act;
Enactment
Short title
and
commen-
cement
Interpretation
Cap. 388
State-Owned Enterprises [No. 10 of 2026 421
GOVERNMENT OF ZAMBIA
ACT
No. 10 of 2026
Date of Assent: 31st March, 2026

n-
cement
Interpretation
Cap. 388
State-Owned Enterprises [No. 10 of 2026 421
GOVERNMENT OF ZAMBIA
ACT
No. 10 of 2026
Date of Assent: 31st March, 2026

“associate” has the meaning assigned to the word in the Anti-
Corruption Act;
“bank” has the meaning assigned to the word in the Banking
and Financial Services Act, 2026;
“bilateral agreement” has the meaning assigned to the words
in the Ratification of International Agreements Act;
“board” means the governing board of a state-owned
enterprise constituted under section 15;
“Cabinet Minister” means a Minister referred to under Article
113(c) of the Constitution;
“chairperson” means the person appointed as chairperson of
the board in accordance with section 15;
“chief executive officer” has the meaning assigned to the
words in the Companies Act;
“commercial activity” includes an action which involves the
buying, selling or trading of goods or services with the
primary objective of generating a profit;
“Consolidated Fund” means the Consolidated Fund established
under the Constitution;
“controlling officer” has the meaning assigned to the words
in the Public Finance Management Act;
“corporate” has the meaning assigned to the word in the
Companies Act;
“council chairperson” has the meaning assigned to the words
in the Constitution;
“councillor” has the meaning assigned to the word in the
Constitution;
“Department” means the Government Investment
Department established under section 5;
“direct ownership” means—
(a) the sole ownership of shares, or the ownership of
more than fifty percent of the share capital, by the
Government in a state-owned enterprise; or
(b) the ownership by the Government of a state-owned
enterprise without shares;
Cap.

share capital, by the
Government in a state-owned enterprise; or
(b) the ownership by the Government of a state-owned
enterprise without shares;
Cap.

91
Act No. 9 of
2026
Cap.18
Cap. 1
Cap. 388
Cap. 1
Cap. 347
Cap. 388
Cap. 1
Cap. 1
422 No. 10 of 2026] State-Owned Enterprises

91
Act No. 9 of
2026
Cap.18
Cap. 1
Cap. 388
Cap. 1
Cap. 347
Cap. 388
Cap. 1
Cap. 1
422 No. 10 of 2026] State-Owned Enterprises

“director” has the meaning assigned to the word in the
Companies Act;
“economically significant price” means a price that influences
supply and demand;
“emoluments” has the meaning assigned to the word in the
Constitution;
“Emoluments Commission” means the Emoluments
Commission established under the Constitution;
“executive officer” has the meaning assigned to the words in
the Companies Act;
“financial institution” has the meaning assigned to the words
in the Banking and Financial Services Act, 2026;
“financially distressed” has the meaning assigned to the words
in the Corporate Insolvency Act;
“fit and proper person” means a person who is—
(a) financially sound, competent, reputable and reliable;
and
(b) suitable for a specific responsibility assessed in
relation to fit and proper requirements specified
under this Act;
“holding company” means a state-owned enterprise that—
(a) has been granted ownership powers under section
13(1); or
(b) holds shares on behalf of the Minister as a nominee
under section 13(2);
“independent non-executive director” means a person who is
not involved in the day-to-day management of a state-
owned enterprise and meets the criteria specified in the
First Schedule;
“indirect ownership” means the sole ownership of the shares,
or the ownership of the majority of the shares, by the
Government in a subsidiary through a state-owned
enterprise or any other State institution as may be
prescribed;
Cap.

e majority of the shares, by the
Government in a subsidiary through a state-owned
enterprise or any other State institution as may be
prescribed;
Cap.

1
Cap. 1
Cap. 388
Cap. 388
Cap. 431
Act No. 9 of
2026
State-Owned Enterprises [No. 10 of 2026 423

1
Cap. 1
Cap. 388
Cap. 388
Cap. 431
Act No. 9 of
2026
State-Owned Enterprises [No. 10 of 2026 423

“judicial officer” has the meaning assigned to the words in
the Constitution;
“legally disqualified” means the absence of legal capacity as
provided in section 4 of the Mental Health Act;
“major infrastructure project” means a large-scale project that
requires capital of more than zero-point zero five percent
of nominal Gross Domestic Product and includes a natural
resource investment project;
“market failure” means a scenario where a market, if left to
operate on its own, does not provide enough goods or
services in the Republic to meet the public interest;
“market production” means the production of goods or services
sold in the marketplace at an economically significant price;
“material relationship” means a personal, familial or business
affiliation between associated persons or a transaction that
relates to, or is connected with, the wealth, business or
family interests of a director;
“meeting” has the meaning assigned to the word in the
Companies Act;
“Member of Parliament” has the meaning assigned to the
words in the Constitution;
“multilateral agreement” means an agreement concluded
between Zambia and two or more States or between
Zambia and two or more international organisations that
does not require the ratification of the State;
“nominee” has the meaning assigned to the word in the
Companies Act;
“ownership powers” means the ownership by the Government
of a state-owned enterprise that is exempt from
incorporation as specified under section 7(3);
“parent company” means a state-owned enterprise primarily
engaged in market production that has ownership of a
majority of shares or exercises control in a subsidiary;
Cap.

a state-owned enterprise primarily
engaged in market production that has ownership of a
majority of shares or exercises control in a subsidiary;
Cap.

1
Cap. 1
Cap. 388
Cap. 305
Cap.388
424 No. 10 of 2026] State-Owned Enterprises

1
Cap. 1
Cap. 388
Cap. 305
Cap.388
424 No. 10 of 2026] State-Owned Enterprises

“performance management framework” means a framework
developed by the Department for the purpose of improving
accountability of a state-owned enterprise;
“practice standard” has the meaning assigned to the words in
the Accountants Act;
“procuring entity” has the meaning assigned to words in the
Public Procurement Act, 2020;
“Provincial Minister” has the meaning assigned to the words
in the Constitution;
“public interest” means the protection of the welfare of a
citizen and includes the equitable provision of essential
goods and services and the safeguarding of national or
critical infrastructure;
“public interest service obligation” means an obligation that
the Government assigns a state-owned enterprise for the
purpose of ensuring that an essential service is provided to
the public and includes an activity that a state-owned
enterprise or any other company would not normally offer
on a commercial basis;
“recapitalisation” means the process of restructuring the debt
and equity structure of a state-owned enterprise to stabilise
the capital structure of that state-owned enterprise;
“regulatory distortion” means a regulatory provision that
favours a certain market participant or introduces a
regulatory barrier to market entry and competition;
“relative” has the meaning assigned to the word in the Anti-
Corruption Act;
“reorganisation” means the process of changing the internal
structure or operations of a state-owned enterprise to
improve the effectiveness, efficiency or competitiveness
of a state-owned enterprise by changing the reporting
structure, operational processes, management systems or
other areas of a state-owned enterprise to achieve the goals
of a state-owned enterprise;
Cap.

structure, operational processes, management systems or
other areas of a state-owned enterprise to achieve the goals
of a state-owned enterprise;
Cap.

91
Cap.1
Cap. 390
Act No. 8 of
2020
State-Owned Enterprises [No. 10 of 2026 425

91
Cap.1
Cap. 390
Act No. 8 of
2020
State-Owned Enterprises [No. 10 of 2026 425

“restructuring” means the process of reorganising the structure,
operations or finances of a state owned enterprise to
improve efficiency and profitability by means as may be
prescribed to streamline operations, reduce costs or improve
productivity;
“secretary” has the meaning assigned to the word in the
Companies Act;
“Securities and Exchange Commission” means the Securities
and Exchange Commission continued under the Securities
Act;
“shareholder” has the meaning assigned to the word in the
Companies Act;
“State institution” has the meaning assigned to the words in
the Constitution;
“state shareholding” means a form of ownership where the
Government owns a majority of shares either directly in,
or through, a state-owned enterprise or State institution;
“state-owned enterprise” means a—
(a) corporate that is primarily engaged in market
production or commercial activity in which the
Government—
(i) has either indirect, or direct, ownership; or
(ii) exercises control to appoint the majority of
the board of directors or senior
management;
(b) statutory corporation that is primarily engaged in
market production or commercial activity;
(c) parent company;
(d) holding company; or
(e) subsidiary;
Cap.

ry corporation that is primarily engaged in
market production or commercial activity;
(c) parent company;
(d) holding company; or
(e) subsidiary;
Cap.

388
Cap. 354
Cap. 388
Cap. 1
426 No. 10 of 2026] State-Owned Enterprises

388
Cap. 354
Cap. 388
Cap. 1
426 No. 10 of 2026] State-Owned Enterprises

“subsidiary” means a state-owned enterprise that is a subsidiary
of another state-owned enterprise and includes a—
(a) state-owned enterprise in which the holding company
or parent company holds more than half in value
of the equity share capital, whether the state-owned
enterprise is incorporated in a jurisdiction that has
or does not have nominal value for share capital;
(b) state-owned enterprise of which the holding
company or parent company is a member, and
whose composition of board of directors is
controlled by the holding company or parent
company; or
(c) subsidiary of a state-owned enterprise which is itself
a subsidiary of a holding company or parent
company in accordance with paragraph (a) or (b);
“vice-chairperson” means the person appointed as vice-
chairperson under section 15;
“winding up” has the meaning assigned to the words in the
Corporate Insolvency Act;
“Zambia Institute of Chartered Accountants” means the
Zambia Institute of Chartered Accountants continued under
the Accountants Act; and
“Zambia Qualifications Authority” means the Zambia
Qualifications Authority continued under the Zambia
Qualifications Authority Act, 2024. 3.

Act; and
“Zambia Qualifications Authority” means the Zambia
Qualifications Authority continued under the Zambia
Qualifications Authority Act, 2024. 3.

(1) This Act shall not apply to a—
(a) state-owned enterprise established under a bilateral
agreement or multilateral agreement; or
(b) state-owned enterprise formed for the purpose of
matters dealing with defence or security of the
Republic. 4. The following principles shall be applied in achieving the
purpose of this Act:
(a) the need to address market failure;
(b) accountability and transparency of a state-owned
enterprise;
Cap. 431
Cap. 390
Act No. 8 of
2024
Non-
application
Guiding
principles
State-Owned Enterprises [No. 10 of 2026 427

rency of a state-owned
enterprise;
Cap. 431
Cap. 390
Act No. 8 of
2024
Non-
application
Guiding
principles
State-Owned Enterprises [No. 10 of 2026 427

(c) fair competition and preservation of market integrity;
(d) equitable treatment of, and equal access to information
to, shareholders; and
(f) sustainability and resilience of a state-owned
enterprise. PART II
THE GOVERNMENT INVESTMENT DEPARTMENT
5. (1) There is established, within the Ministry responsible for
finance, the Government Investment Department which is
responsible for the administration of this Act under the general
direction of the Permanent Secretary in the Ministry responsible
for finance.

hich is
responsible for the administration of this Act under the general
direction of the Permanent Secretary in the Ministry responsible
for finance.

(2) Despite the generality of subsection (1), the functions of
the Department are to—
(a) develop the policies, guidelines, strategies and standards
relating to the governance of state-owned enterprises;
(b) develop a performance management framework for a
state-owned enterprise;
(c) review the portfolio of a state-owned enterprise and make
recommendations for reforms and restructuring of a
state- owned enterprise;
(d) review state shareholding in a state-owned enterprise in
line with the principles of this Act;
(e) review shareholder agreements, transfer agreements or
any other agreements relating to the sale or transfer of
shares, where applicable;
(f)review a recommendation by a relevant ministry,
Government department, state-owned enterprise or other
appropriate authority that intends to incorporate a state-
owned enterprise;
(g) review a written proposal for recapitalisation of a state-
owned enterprise;
(h) conduct a periodic review of the financial and operational
performance of a state-owned enterprise in line with
the performance management framework and
performance contracts;
Government
Investment
Department
428 No. 10 of 2026] State-Owned Enterprises

line with
the performance management framework and
performance contracts;
Government
Investment
Department
428 No. 10 of 2026] State-Owned Enterprises

(i) assess the fiscal risks of a state-owned enterprise;
(j)develop and publish a comprehensive annual aggregate
state-owned enterprise performance report;
(k) keep and maintain records for information on the financial
statements, dividends, grants and recapitalisation of a
state-owned enterprise;
(l) monitor compliance of a state-owned enterprise with the
provisions of this Act;
(m) advise the Minister on matters relating to this Act; and
(n) perform any other function relating to the incorporation
or establishment of a state-owned enterprise as the
Minister may prescribe. 6. (1) The Civil Service Commission shall appoint as a public
officer, a Director who is responsible for the administration of the
functions of the Department. (2) The Permanent Secretary in the Ministry responsible for
finance may give to the Director, general or specific directions,
which are consistent with the provisions of this Act, relating to the
performance of the Director’s functions and the Director shall give
effect to those directions.

stent with the provisions of this Act, relating to the
performance of the Director’s functions and the Director shall give
effect to those directions.

(3) The Civil Service Commission shall appoint as public
officers, other staff of the Department that the Civil Service
Commission considers necessary for the administration and
implementation of this Act. (4) The Director may, in writing, delegate the exercise of any
of the functions conferred on the Director by this Act to any other
staff that the Director considers necessary. PART III
INCORPORATION OF STATE-OWNED ENTERPRISES
7. (1) Subject to subsection (3), a state-owned enterprise shall
be incorporated in accordance with the Companies Act. (2) Despite subsection (1), a state-owned enterprise shall not
incorporate a subsidiary without the approval of the Minister. Director and
other staff
Incorporation
of state-
owned
enterprise
Cap. 388
State-Owned Enterprises [No. 10 of 2026 429

t the approval of the Minister. Director and
other staff
Incorporation
of state-
owned
enterprise
Cap. 388
State-Owned Enterprises [No. 10 of 2026 429

(3) Despite subsection (1), the Minister may, with the approval
of Cabinet, by statutory instrument, exempt an existing state-owned
enterprise from being incorporated under the Companies Act. (4) The Minister may, make Regulations relating to the
establishment, restructuring, privatisation or winding up of a state-
owned enterprise exempt under subsection (3). 8. (1) Subject to subsections (4) and (5), the Minister shall, on
the Minister’s own motion or on recommendation of a relevant
ministry, Government department, state-owned enterprise, or other
appropriate authority, incorporate, privatise or wind up a state- owned
enterprise or acquire state shareholding.

nt, state-owned enterprise, or other
appropriate authority, incorporate, privatise or wind up a state- owned
enterprise or acquire state shareholding.

(2) The Minister shall, in incorporating a state-owned enterprise
or acquiring state shareholding under subsection (1), take into
account the following:
(a) safeguarding the public interest where private sector
participants are unwilling to assume the costs or risks of
operating that commercial activity or enterprise;
(b) addressing market failure where an essential service is
undersupplied, unaffordable or delivered inefficiently
due to information gaps, high entry barriers or natural
monopoly characteristics; and
(c) enhancing market competition with the objective of
improving efficiency, innovation and consumer choice. (3) The recommendation by a relevant ministry, Government
department, state-owned enterprise or other appropriate authority
for the incorporation of a state-owned enterprise or acquisition of
state shareholding under subsection (1) shall—
(a) specify the reason and objective for the proposed
incorporation of a state-owned enterprise or acquisition
of state shareholding;
(b) demonstrate the existence of an unsatisfied demand for
goods or services that is not being met by private sector
participants;
Cap.

shareholding;
(b) demonstrate the existence of an unsatisfied demand for
goods or services that is not being met by private sector
participants;
Cap.

388
Incorporation,
privatisation
and winding
up of state-
owned
enterprise
430 No. 10 of 2026] State-Owned Enterprises

388
Incorporation,
privatisation
and winding
up of state-
owned
enterprise
430 No. 10 of 2026] State-Owned Enterprises

(c) demonstrate that the private sector participants in the
industry to which a state-owned enterprise is proposed
to be incorporated or state shareholding are proposed to
be acquired have not entered, or have left the market
voluntarily, and not due to the existence of a barrier to
competition or other regulatory distortions;
(d) demonstrate that Government has taken appropriate
measures to eliminate all barriers to entry and
competition in the area in which the state-owned
enterprise is proposed to operate;
(e) specify the environmental, employee or social implications
to be considered and measures to be taken or adopted
to ensure protection or mitigation of risks associated
with the environment, employees or social implications;
(f)determine whether the regulatory framework requires any
changes to accommodate or ensure proper regulation
of the proposed state-owned enterprise, or of the market
in which the state-owned enterprise shall operate;
(g) analyse the potential impact on trade and competition;
(h) justify why the proposed activity or mandate proposed to
be carried out by the state-owned enterprise cannot be
achieved through an existing state-owned enterprise, a
written law or any other means; and
(i) enumerate the proposed shareholding structure and total
capital requirement for the state-owned enterprise.

a
written law or any other means; and
(i) enumerate the proposed shareholding structure and total
capital requirement for the state-owned enterprise.

(4) The Minister shall, on receipt of the recommendation
referred to under subsection (1)—
(a) conduct an assessment of that recommendation;
(b) prepare a market failure and options assessment report
as prescribed on the finding of the assessment;
(c) submit the report to Cabinet; and
(d) publish the report in the Gazette and on the official website
of the ministry responsible for finance. (5) The Minister shall, in consultation with Cabinet, make a
decision on the recommendation referred to under subsection (1)
and notify a relevant ministry, Government department, state-owned
enterprise or other appropriate authority of the decision of the
Minister. State-Owned Enterprises [No. 10 of 2026 431

ernment department, state-owned
enterprise or other appropriate authority of the decision of the
Minister. State-Owned Enterprises [No. 10 of 2026 431

9. (1) The Minister shall cease the state shareholding in a state-
owned enterprise where the—
(a) purpose for its establishment has been achieved and the
continued existence of that state-owned enterprise is no
longer required;
(b) continued operation of the state-owned enterprise is
creating market distortion which stifles market
development;
(c) goods and services offered by the state-owned enterprise
are provided at a lower cost to the consumer and more
cost effectively by the private sector and render the
continued existence of the state-owned enterprise
unsustainable;
(d) state-owned enterprise undertaking an economic activity
cannot be operated profitably on a sustainable basis or
without creating substantial fiscal risk to the Government;
or
(e) continued operation of the state-owned enterprise is not
in the public interest and is contrary to the Government’s
national investment policies and strategies. (2) The Minister shall ensure that where the cessation of the
state shareholding of a state-owned enterprise involves winding
up, that the winding up is conducted in accordance with the Corporate
Insolvency Act and any other written law.

tate-owned enterprise involves winding
up, that the winding up is conducted in accordance with the Corporate
Insolvency Act and any other written law.

(3) The Minister shall ensure that where the cessation of the
state shareholding of a state-owned enterprise involves privatisation,
that cessation is conducted as prescribed and in accordance with
any other relevant written law, and that the Government’s interest
in the state-owned enterprise is adequately protected. (4) The Minister shall at least every three years, review
whether the conditions for continued state shareholding as specified
under section 8(2) and (3) still exist in order to inform the Minister’s
decision under subsection (1). (5) The Minister shall submit the results of a review conducted
under subsection (4) to the National Assembly not later than ninety
days after the completion of the review. Cessation of
state
shareholding
Cap. 431
432 No. 10 of 2026] State-Owned Enterprises

ly not later than ninety
days after the completion of the review. Cessation of
state
shareholding
Cap. 431
432 No. 10 of 2026] State-Owned Enterprises

PART IV
SHAREHOLDER AND OWNERSHIP RIGHTS IN A STATE-OWNED
ENTERPRISE
10. Subject to the Companies Act and sections 8 and 9, the
rights of a shareholder in a state-owned enterprise shall include—
(a) approving—
(i) the issuance of new shares or repurchase of shares
that affect the rights of a shareholder;
(ii) the sale and acquisition of shares in a state-owned
enterprise;
(iii) the winding up of the state-owned enterprise;
and
(iv) the entering into transactions that—
(a) have the effect of a state-owned
enterprise acquiring a right or interest
or incurring an obligation or a liability,
including a contingent liability, whose
value exceeds twenty-five percent of
the net assets of the state-owned
enterprise; or
(b) involve a merger, acquisition, sell, lease
or otherwise disposal of assets, whose
value exceeds twenty-five percent of
the gross assets of a state-owned
enterprise’s assets;
(b) amending the articles of association or constitutive
documents to change the core business activities of a
state-owned enterprise; and
(c) the fixing of the remuneration of a director for
recommendation to the Emoluments Commission. 11.

ness activities of a
state-owned enterprise; and
(c) the fixing of the remuneration of a director for
recommendation to the Emoluments Commission. 11.

The ownership rights of the Minister in a state-owned
enterprise that is exempt from incorporation as specified under
section 7(3) shall include—
(a) participating at general meetings, where applicable;
Rights of
shareholder
in state-
owned
enterprise
Cap. 388
Ownership
rights of
Minister in
state-owned
enterprise
that is
exempt from
incorporation
State-Owned Enterprises [No. 10 of 2026 433

terprise
Cap. 388
Ownership
rights of
Minister in
state-owned
enterprise
that is
exempt from
incorporation
State-Owned Enterprises [No. 10 of 2026 433

(b) appointing or removing directors;
(c) approving—
(i) the appointment of auditors and fixing of the
auditor’s remuneration for recommendation to
the Emoluments Commission;
(ii) the winding up of the state-owned enterprise;
(iii) financial statements and annual reports; and
(iv) the entering into transactions that—
(a) have the effect of a state-owned
enterprise acquiring a right or interest
or incurring an obligation or a liability,
including a contingent liability, whose
value exceeds twenty-five percent of
the net assets of the state-owned
enterprise; or
(b) involve a merger, acquisition, sell, lease
or otherwise disposal of assets, whose
value exceeds twenty-five percent of
the gross assets of a state-owned
enterprise’s assets; and
(c) the fixing of the remuneration of a director for
recommendation to the Emoluments Commission. 12. (1) Shares directly or indirectly owned by the Government
or ownership powers of the Government, in a state-owned enterprise
shall vest in the Minister and shall be held in trust for the people of
Zambia in accordance with the Minister of Finance (Incorporation)
Act.

erprise
shall vest in the Minister and shall be held in trust for the people of
Zambia in accordance with the Minister of Finance (Incorporation)
Act.

(2) Despite subsection (1), shares in a subsidiary may be
registered in the name of a holding company or parent company. (3) The subscription or acquisition of shares in a state-owned
enterprise by the Minister shall be paid from the funds appropriated
by Parliament. Shareholding
and
ownership of
state-owned
enterprise
Cap. 349
434 No. 10 of 2026] State-Owned Enterprises

d from the funds appropriated
by Parliament. Shareholding
and
ownership of
state-owned
enterprise
Cap. 349
434 No. 10 of 2026] State-Owned Enterprises

(4) A holding company or parent company shall, where the
Minister has ownership powers in that holding company or parent
company, exercise ownership powers in relation to a subsidiary of
that holding company or parent company. 13. (1) The Minister may exercise the rights of a shareholder,
ownership powers, and oversight over a state-owned enterprise or
subsidiary through a holding company. (2) The shares of a state-owned enterprise or subsidiary vested
in the Minister under section 12(1) may be registered in the name
of the holding company as a nominee of the Minister in accordance
with guidelines issued by the Minister for that purpose. (3) A holding company referred to under subsection (1), shall
hold, manage, coordinate or control state shareholding or ownership
on behalf of the Government in a state-owned enterprise that is a
subsidiary in a manner as may be determined by the Minister through
transfer of shares, agreement or any other form.

state-owned enterprise that is a
subsidiary in a manner as may be determined by the Minister through
transfer of shares, agreement or any other form.

(4) A holding company shall exercise the rights of a shareholder,
ownership powers, and oversight over its subsidiary in the following
manner which includes:
(a) developing a list of qualified board candidates in accordance
with this Act and other applicable written law and any
other criteria specified by the Minister and select
members of the board for each state-owned enterprise
for approval at a general meeting;
(b) ensuring that subsidiaries adhere to the provisions of this
Act and any other written law;
(c) reviewing strategic and business plans of subsidiaries under
its authority in order to promote return on investment
and improvement of performance, and to identify
financial, operational, strategic, compliance and other
relevant risks, and concrete measures to mitigate such
risks;
(d) evaluating and monitoring the performance of all
subsidiaries under its authority to assess, at a minimum,
implementation of performance targets, profitability,
efficiency, financial liabilities, risk management and the
impact of the subsidiary on private sector activities and
investment;
Holding
company
State-Owned Enterprises [No. 10 of 2026 435

k management and the
impact of the subsidiary on private sector activities and
investment;
Holding
company
State-Owned Enterprises [No. 10 of 2026 435

(e) monitoring compliance of subsidiaries to statutory
obligations and taking remedial measures;
(f)reviewing the audited financial statements and auditor’s
report for each subsidiary and propose corrective action
plans to address any documented issues at the general
meeting;
(g) developing and submitting consolidated investment plan
for its subsidiary to the Minister;
(h) determining minimum standards and policies on human
resource management, remuneration, corporate
governance, information technologies, risk management
and audit in line with best practices, and policies
developed under section 5 and any other written law;
(i) appointing or removing directors in accordance with the
Companies Act; and
(j)making recommendations to the Minister on the
restructuring of a state-owned enterprise, where
appropriate. PART V
GOVERNANCE OF STATE-OWNED ENTERPRISES
14. (1) The Minister shall, for the purposes of this Act—
(a) adopt a nomination policy for a director of a state-owned
enterprise; and
(b) restructure, wind up or divest state shareholding in line
with national policies, principles under this Act and the
rationale for state shareholding.

restructure, wind up or divest state shareholding in line
with national policies, principles under this Act and the
rationale for state shareholding.

(2) A nomination policy referred to under subsection (1)(a)
shall specify a transparent, fair and competitive nomination and
selection process of a director of a state-owned enterprise. 15. (1) A board of a state-owned enterprise shall—
(a) be appointed in accordance with the Companies Act or
any other relevant written law; and
(b) consist of an odd number of directors not exceeding eleven. (2) A board referred to under subsection (1) shall consist of a
majority of independent non-executive directors. (3) The chairperson and vice-chairperson of a board shall be
appointed from among the independent directors. Cap. 388
Responsibilities
of Minister
in
governance
of state-
owned
enterprise
Board of
state-owned
enterprise
Cap. 388
436 No. 10 of 2026] State-Owned Enterprises

onsibilities
of Minister
in
governance
of state-
owned
enterprise
Board of
state-owned
enterprise
Cap. 388
436 No. 10 of 2026] State-Owned Enterprises

(4) The composition of a board referred to under subsection
(1) shall be—
(a) balanced to ensure relevant professional experience,
qualifications and skills; and
(b) represented of fifty percent of each gender excluding the
chairperson unless it is not practicable to do so. (5) A director of a state-owned enterprise shall not sit on the
boards of more than two state-owned enterprises. (6) A person qualifies for appointment as director if that
person—
(a) possesses the relevant professional experience and
competence skills as prescribed; and
(b) is a fit and proper person in accordance with the
requirements specified in the Second Schedule.

perience and
competence skills as prescribed; and
(b) is a fit and proper person in accordance with the
requirements specified in the Second Schedule.

(7) Subject to the Companies Act, and this Act, a person is not
eligible for appointment as director if that person—
(a) has been convicted of an offence involving fraud and
dishonesty;
(b) is an undischarged bankrupt;
(c) is legally disqualified from performing the functions of a
director;
(d) is an office bearer or employee of a political party;
(e) is a councillor, council chairperson or Member of
Parliament;
(f)is a judicial officer;
(g) has a superior rank in the Defence Forces;
(h) is a Cabinet Minister or Provincial Minister;
(i) is a Permanent Secretary;
(j)is an employee of that state-owned enterprise;
(k) has been convicted of an offence under any written law
and is sentenced to imprisonment for a term exceeding
six months without the option of a fine;
(l) has any material relationship with that state-owned
enterprise;
Cap. 388
State-Owned Enterprises [No. 10 of 2026 437

without the option of a fine;
(l) has any material relationship with that state-owned
enterprise;
Cap. 388
State-Owned Enterprises [No. 10 of 2026 437

(m) is an employee of a regulatory body which regulates the
state-owned enterprise; or
(n) is a controlling officer of a State institution. (8) The Third Schedule applies to a board. 16. (1) A board shall be responsible for providing oversight and
strategic direction to a state-owned enterprise.

e Third Schedule applies to a board. 16. (1) A board shall be responsible for providing oversight and
strategic direction to a state-owned enterprise.

(2) Despite the generality of subsection (1), the functions of a
board are to—
(a) advise the shareholders, or the Minister, where the Minister
has ownership powers, on matters relating to the
supervision, risk management, internal controls and
operation of a state-owned enterprise;
(b) develop, negotiate and execute performance contracts
entered into with the shareholders, or the Minister, where
the Minister has ownership powers;
(c) approve the organisational structure of the state-owned
enterprise, taking into account the financial sustainability
of the state-owned enterprise;
(d) ensuring that decisions, rules and guidelines for the
operation of the state-owned enterprise align with the
primary objective of the state-owned enterprise;
(e) approve—
(i) policies, frameworks, plans and the annual budget
and oversee the implementation of the policies,
frameworks, plans and the annual budget;
(ii) any transactions with third parties in accordance
with the policies of a state-owned enterprise;
and
(iii) the financial statements prepared by the state-
owned enterprise and cause the financial
statements to be submitted to the Secretary to
the Treasury;
(f)monitor and evaluate the performance of a state-owned
enterprise against its policies, frameworks, plans and the
annual budget;
Functions of
board
438 No.

tor and evaluate the performance of a state-owned
enterprise against its policies, frameworks, plans and the
annual budget;
Functions of
board
438 No.

10 of 2026] State-Owned Enterprises

10 of 2026] State-Owned Enterprises

(g) enter into transactions relating to mergers, acquisitions,
divestitures, reorganisation, restructuring or other similar
transactions, subject to the approval of the shareholders
or the Minister, where the Minister has ownership
powers;
(h) monitor and manage areas of potential conflicts of interest
between a director and a state-owned enterprise;
(i) develop and submit an investment plan of a state-owned
enterprise to the shareholders or the Minister, where
the Minister has ownership powers;
(j)make recommendations on any matter relating to the state-
owned enterprise at a general meeting; and
(k) conduct annual board performance evaluations of the
directors. (3) Subject to the other provisions of this Act, a board shall
establish committees on matters dealing with audit, risk management,
finance and investment, human resource and remuneration,
nomination and any other matter that the board considers necessary. 17. (1) The Emoluments Commission may, on the recommendation
of the shareholders, or the Minister, where the Minister has
ownership powers, determine the remuneration of the directors of
a state-owned enterprise.

f the shareholders, or the Minister, where the Minister has
ownership powers, determine the remuneration of the directors of
a state-owned enterprise.

(2) The shareholders, or the Minister, where the Minister has
ownership powers, shall, in recommending the remuneration
referred to under subsection (1), consider the financial sustainability
of a state-owned enterprise. (3) Despite subsections (1) and (2), the remuneration of
directors of a state-owned enterprise shall be on a quarterly basis
and may include board meeting fees and retainer fees. (4) Despite subsection (3), a director shall not be entitled to
board meeting fees if the director has not attended any board meeting
in a quarter. (5) A director shall not be entitled to any benefits from a state-
owned enterprise, including—
Remuneration
of directors
State-Owned Enterprises [No. 10 of 2026 439

shall not be entitled to any benefits from a state-
owned enterprise, including—
Remuneration
of directors
State-Owned Enterprises [No. 10 of 2026 439

(a) personal to holder vehicles;
(b) housing allowances;
(c) preferential access to goods or services provided by the
state-owned enterprise;
(d) club memberships, association memberships or similar
benefits;
(e) annual retainers or honoraria not expressly authorised by
this Act;
(f)stock options, equity-based compensation, or profit sharing
schemes;
(g) variable pay, unless specifically authorised by any other
written law; or
(h) any other additional benefits as may be prescribed. (6) A state-owned enterprise shall disclose the remuneration
received by directors in the audited financial statements of a state
owned enterprise which shall be published in the Gazette and an
official website of a state-owned enterprise. (7) The disclosure referred to under subsection (6) shall include
the form, amount and basis for each remuneration. 18. (1) A board shall appoint a chief executive officer of a
state- owned enterprise who shall be responsible for the day-to-
day management of a state-owned enterprise.

ll appoint a chief executive officer of a
state- owned enterprise who shall be responsible for the day-to-
day management of a state-owned enterprise.

(2) The responsibilities of the chief executive officer in the
day-to-day management of a state-owned enterprise shall include
the following:
(a) implementing goals, targets and strategic objectives as
determined by a board;
(b) risk management, internal controls and legal and regulatory
compliance; and
(c) the proper financial management and expenditure for all
funds, assets and any resources appropriated to the
state- owned enterprise. (3) The chief executive officer shall—
(a) be an ex-officio member of a board;
(b) not have voting rights on a board; and
(c) not be entitled to a board meeting fee or a retainer. Chief
executive
officer
440 No. 10 of 2026] State-Owned Enterprises

g rights on a board; and
(c) not be entitled to a board meeting fee or a retainer. Chief
executive
officer
440 No. 10 of 2026] State-Owned Enterprises

(4) A person qualifies for appointment as a chief executive
officer if that person—
(a) holds a degree or its equivalent recognised by the Zambia
Qualifications Authority; and
(b) possesses the relevant qualifications and professional
competencies, as prescribed.

ivalent recognised by the Zambia
Qualifications Authority; and
(b) possesses the relevant qualifications and professional
competencies, as prescribed.

(5) A person does not qualify for appointment as a chief
executive officer of a state-owned enterprise if that person—
(a) is serving as a director of that state-owned enterprise;
(b) has served as a director of that state-owned enterprise
within the last preceding three years;
(c) has a material relationship with the state-owned enterprise;
(d) has been convicted of an offence involving fraud or
dishonesty;
(e) is an undischarged bankrupt;
(f)is legally disqualified from performing the functions of a
chief executive officer;
(g) is an office bearer or employee of a political party;
(h) is a councillor, council chairperson or Member of
Parliament;
(i) is a judicial officer;
(j)has a superior rank in the Defence Forces;
(k) is a Cabinet Minister or Provincial Minister;
(l) is a Permanent Secretary;
(m) has been removed from a public office for misconduct;
(n) has been convicted of an offence under any written law
and is sentenced to imprisonment for a term exceeding
six months without the option of a fine; or
(o) is a controlling officer of a State institution.

and is sentenced to imprisonment for a term exceeding
six months without the option of a fine; or
(o) is a controlling officer of a State institution.

(6) The chief executive officer shall hold office for a term of
five years and may be re-appointed for two further and final terms
of five years. State-Owned Enterprises [No. 10 of 2026 441

old office for a term of
five years and may be re-appointed for two further and final terms
of five years. State-Owned Enterprises [No. 10 of 2026 441

(7) The office of a chief executive officer shall become vacant
if that chief executive officer—
(a) dies;
(b) is convicted of an offence under any written law and is
sentenced to imprisonment for a term exceeding six
months without the option of a fine;
(c) is adjudged bankrupt under any written law;
(d) resigns by notice, in writing, to the board;
(f)breaches a fiduciary duty;
(g) misappropriates funds or assets of a state-owned enterprise;
(h) is found guilty of professional misconduct;
(i) is legally disqualified from performing the functions of a
chief executive officer; or
(j)holds a position in a political party. 19. (1) Subject to the Companies Act, a board shall appoint a
secretary of a state-owned enterprise who shall perform the
secretarial functions of the board. (2) A board may appoint other staff of a state-owned enterprise
that the board considers necessary for the performance of the
functions of the state-owned enterprise. 20. A board shall determine the terms and conditions of
appointment and remuneration of a chief executive officer, secretary
and other staff of a state-owned enterprise. PART VI
FINANCIAL PROVISIONS AND DISCLOSURE
21.

and remuneration of a chief executive officer, secretary
and other staff of a state-owned enterprise. PART VI
FINANCIAL PROVISIONS AND DISCLOSURE
21.

The financial year of a state-owned enterprise shall be a
period of twelve months ending on 31st December in each year. 22. (1) A state-owned enterprise shall cause to be kept
proper books of account and other records relating to its accounts. Secretary and
other staff
Cap. 388
Terms and
conditions of
appointment
and
remuneration
of chief
executive
officer,
secretary
and other
staff
Financial
year
Accounts
and audit
442 No. 10 of 2026] State-Owned Enterprises

t
and
remuneration
of chief
executive
officer,
secretary
and other
staff
Financial
year
Accounts
and audit
442 No. 10 of 2026] State-Owned Enterprises

(2) The accounts of a state-owned enterprise shall be audited
by the Auditor-General or an auditor appointed by the Auditor-
General in accordance with the Public Audit Act. (3) A state-owned enterprise shall, in addition to the audit
referred to under subsection (2), have the financial statements of
the state-owned enterprise audited annually by an external auditor. (4) A board shall, at a general meeting, recommend the
external auditor referred to under subsection (3) to the shareholders,
or the Minister, where the Minister has ownership powers, for
appointment, to audit the state-owned enterprise. (5) The external auditor referred to under subsection (3) shall
be an audit firm registered with the Zambia Institute of Chartered
Accountants. (6) Despite subsection (5), an individual in the audit firm under
subsection (5) shall not be engaged as an auditor by the same
state- owned enterprise for a period of more than seven consecutive
years in any of the following roles:
(a) as the partner responsible for signing an audit report;
(b) as an individual appointed to perform the audit quality
review; or
(c) as an individual involved in any other key audit roles.

ng an audit report;
(b) as an individual appointed to perform the audit quality
review; or
(c) as an individual involved in any other key audit roles.

(7) An individual referred to under subsection (6) shall be
eligible to perform the functions of an auditor after the expiration
of the following periods:
(a) in the case of a partner responsible for signing the audit
report, five years;
(b) in the case of an individual appointed to perform the audit
quality review, three years; or
(c) in the case of an individual involved in any other key audit
roles, two years. (8) The fees of the external auditor shall be paid by the state-
owned enterprise. 23. (1) A state-owned enterprise shall cause to be prepared a
financial statement in accordance with the practice standards
recognised by the Zambia Institute of Chartered Accountants that
the Minister may determine. Cap. 378
Financial
reporting
State-Owned Enterprises [No. 10 of 2026 443

he Zambia Institute of Chartered Accountants that
the Minister may determine. Cap. 378
Financial
reporting
State-Owned Enterprises [No. 10 of 2026 443

(2) A state-owned enterprise shall, not later than ninety days
after the end of the financial year—
(a) in the case of a state-owned enterprise that is not a
subsidiary, submit to the Secretary to the Treasury, an
annual report and audited financial statements; and
(b) in the case of a subsidiary, submit an annual report and
audited financial statements to a holding company or
parent company. (3) A holding company or parent company shall, on receipt of
an annual report and audited financial statement under subsection
(2)(b), within ninety days after the end of the financial year, submit
the annual report and audited financial statement to the Secretary
to the Treasury, as prescribed.

ty days after the end of the financial year, submit
the annual report and audited financial statement to the Secretary
to the Treasury, as prescribed.

(4) An annual report referred to under subsection (2)(b) shall
include information on the following:
(a) an audited financial statement;
(b) summarised audit and risk report of a committee of a
board;
(c) an analysis of the progress towards key performance
targets in the contracts between a board and the
shareholders, or the board and the Minister, where the
Minister has ownership powers;
(d) grants or recapitalisation funds received from Government
or any other source and the purpose; and
(e) an environmental, social and governance report. (5) A holding company or parent company shall, within six
months after the end of a financial year, submit to the Secretary to
the Treasury the following information:
(a) a consolidated annual report on the activities of the holding
company or parent company during that financial year;
and
(b) a consolidated audited financial statement for the holding
company or parent company during that financial year. 444 No. 10 of 2026] State-Owned Enterprises

olidated audited financial statement for the holding
company or parent company during that financial year. 444 No. 10 of 2026] State-Owned Enterprises

(6) The Minister shall, not later than seven months after the
end of a financial year, cause to be laid before the National Assembly
the annual aggregate state-owned enterprise performance report
of all state-owned enterprises. (7) The aggregate annual report referred to under subsection
(6) shall include:
(a) a financial analysis of the state-owned enterprise;
(b) a highlight of major investment or disinvestment
undertaken by a state-owned enterprise;
(c) an overview of corporate governance practises in a state-
owned enterprise;
(d) a summary of monies remitted from the Government and
any other source; and
(e) dividends declared and paid by a state-owned enterprise. 24.

prise;
(d) a summary of monies remitted from the Government and
any other source; and
(e) dividends declared and paid by a state-owned enterprise. 24.

(1) A board of a state-owned enterprise other than a
subsidiary shall, at the end of the quarter of a financial year, submit
to the Secretary to the Treasury the following information:
(a) outstanding guaranteed and non-guaranteed debt for both
foreign and local currency denominated debt;
(b) outstanding on-lending debt for both foreign and local
currency denominated debt;
(c) grants and recapitalisation received from Government or
any other source;
(d) outstanding pension liabilities, including gratuities and
defined pension obligations;
(e) arrears between state-owned enterprises; and
(f)outstanding tax obligations. (2) Despite subsection (1), a board of a subsidiary shall submit
the information referred to under subsection (1) to a holding company
or parent company. (3) A holding company or parent company shall, on receipt of
the information referred to under subsection (2), at the end of a
quarter of a financial year, submit the information to the Secretary
to the Treasury, as prescribed. Quarterly
reports
State-Owned Enterprises [No. 10 of 2026 445

financial year, submit the information to the Secretary
to the Treasury, as prescribed. Quarterly
reports
State-Owned Enterprises [No. 10 of 2026 445

25. (1) A state-owned enterprise shall, not later than six months
after the end of a financial year, publish the following information
in the Gazette and an official website of a state-owned enterprise:
(a) annual reports and audited financial statements;
(b) costs and funding arrangements relating to public policy
objectives or public interest service obligations;
(c) financial assistance, including guarantees, subsidies and
capital transfers received from another state-owned
enterprise or any other source; and
(d) major investment to be undertaken by the state-owned
enterprise. (2) A state-owned enterprise shall, not later than one month of
any change in the following information, publish in the Gazette and
an official website of a state-owned enterprise:
(a) shareholding structure and voting rights of the shareholders;
(b) participation rights of the Minister, where the Minister
has ownership powers;
(c) composition of the board and senior management of a
state-owned enterprise; and
(d) mandate and objective of a state-owned enterprise. 26.

powers;
(c) composition of the board and senior management of a
state-owned enterprise; and
(d) mandate and objective of a state-owned enterprise. 26.

(1) A state-owned enterprise shall, on request by the
Minister, relevant ministry, holding company or parent company,
submit information relating to the affairs of a state-owned enterprise
or its subsidiaries to the Minister, relevant ministry, holding company
or parent company. (2) Despite subsection (1), a state-owned enterprise shall not
submit information relating to an employee or a customer of the
state-owned enterprise, or any other person, if the information
shall result in the identification of another person. PART VII
RECAPITALISATION, RESTRUCTURING, INVESTMENT AND DIVIDENDS
27. (1) A board may, by resolution, make a written proposal
for recapitalisation of a state-owned enterprise. (2) The written proposal for recapitalisation under subsection
(1) shall be accompanied by—
Publication
of
information
Request for
information
Recapitalisation
of state-
owned
enterprise
446 No. 10 of 2026] State-Owned Enterprises

mpanied by—
Publication
of
information
Request for
information
Recapitalisation
of state-
owned
enterprise
446 No. 10 of 2026] State-Owned Enterprises

(a) a statement on the current state of the state-owned
enterprise;
(b) an estimation of the recapitalisation requirements;
(c) the reasons for and justification of the proposed
recapitalisation;
(d) a description of the intended use of any additional equity
or a loan of a shareholder or a loan from the Minister,
where the Minister has ownership powers;
(e) the expected return of the recapitalisation;
(f)an assessment of the associated risks and proposed risk
management strategy; and
(g) a management action plan outlining measures to ensure
the efficient use of equity or a loan of a shareholder or
a loan from the Minister, where the Minister has
ownership powers. (3) A board of a state-owned enterprise, other than a board of
a subsidiary shall, after making the written proposal referred to
under subsection (1), submit the written proposal to the Secretary
to the Treasury.

a subsidiary shall, after making the written proposal referred to
under subsection (1), submit the written proposal to the Secretary
to the Treasury.

(4) The Secretary to the Treasury may, on receipt of the written
proposal referred to under subsection (1), provide a favourable
written opinion to the board on terms and conditions that the
Secretary to the Treasury may determine, if the state-owned
enterprise shows that the proposed recapitalisation shall not—
(a) confer an undue advantage on the state-owned enterprise
over other market participants; and
(b) result in a distortion or substantial lessening of competition
in the relevant sector. (5) The terms and conditions referred to under subsection (4)
may include—
(a) a minimum required return to be provided on the equity or
a loan of a shareholder or a loan from the Minister, where
the Minister has ownership powers;
(b) additional key performance indicators to be incorporated
in a performance contract executed in accordance with
this Act;
State-Owned Enterprises [No. 10 of 2026 447

performance indicators to be incorporated
in a performance contract executed in accordance with
this Act;
State-Owned Enterprises [No. 10 of 2026 447

(c) additional reporting obligations to the Secretary to the
Treasury including methods of verification of agreed
milestones;
(d) phased disbursement of equity or a loan of a shareholder
or a loan from the Minister, where the Minister has
ownership powers based on the achievement of agreed
milestones; or
(e) sanctions or remedial measures to be imposed in the event
of non-compliance with the conditions. (6) A board shall, on receipt of the favourable written opinion
referred to under subsection (4), present the written proposal for
recapitalisation to the shareholders or the Minister, where the Minister
has ownership powers, at a meeting. (7) The shareholders or the Minister, where the Minister has
ownership powers, may, at a meeting referred to under subsection
(6), approve the written proposal where—
(a) a board submitted the written proposal for recapitalisation
to the Secretary to the Treasury at least two months
before the date of the meeting at which the written
proposal is considered; and
(b) the Secretary to the Treasury has provided a favourable
written opinion to a board on the written proposal.

he written
proposal is considered; and
(b) the Secretary to the Treasury has provided a favourable
written opinion to a board on the written proposal.

(8) A recapitalisation under this section may take the form of
equity or a loan of a shareholder or a loan from the Minister, where
the Minister has ownership powers. 28. (1) A board of a subsidiary shall, after making a written
proposal for recapitalisation referred to under section 27 (1), submit
the written proposal to a holding company or parent company. (2) A holding company or parent company shall, on receipt of
the written proposal referred to under subsection (1), assess the
written proposal and the possibility of providing the necessary
recapitalisation funds or recommend alternative measures. (3) A holding company or parent company shall provide the
necessary recapitalisation funds, where the subsidiary shows that
the proposed recapitalisation shall not—
Recapitalisation
of subsidiary
448 No. 10 of 2026] State-Owned Enterprises

s, where the subsidiary shows that
the proposed recapitalisation shall not—
Recapitalisation
of subsidiary
448 No. 10 of 2026] State-Owned Enterprises

(a) confer an undue advantage on the subsidiary over other
market participants; and
(b) result in a distortion or substantial lessening of competition
in the relevant sector. (4) The provisions of section 27(3), (4), (5), (6) and (7) shall
apply where a holding company or parent company is unable to
provide the necessary recapitalisation funds to a subsidiary under
this section. (5) Despite subsection (3), a holding company in which the
Government has ownership powers or sole ownership of shares
shall not provide any equity, capital contribution or any other
recapitalisation without the approval of the Minister. (6) The holding company referred to in subsection (5) shall,
when seeking the approval of the Minister to provide any equity,
capital contribution or any other recapitalisation, submit a
recapitalisation plan for that financial year.

val of the Minister to provide any equity,
capital contribution or any other recapitalisation, submit a
recapitalisation plan for that financial year.

(7) The recapitalisation plan referred to under subsection (6)
shall include—
(a) a subsidiary to be recapitalised in the financial year and
the amounts required for recapilisation;
(b) a clear statement of the purpose and basis for the
recapitalisation;
(c) a comprehensive business case demonstrating why
alternatives, including asset disposals, covenant waivers,
third-party financing, restructuring or liquidation are
unavailable or unsuitable; and
(d) an assessment of fiscal impact on the national budget and
any contingent liabilities including guarantees. (8) The Minister may, where the Minister approves the
recapitalisation referred to under subsection (5), set performance
conditionalities tied to recapitalisation of a subsidiary including
reporting and restructuring. (9) A recapitalisation under this section may take the form of
equity or a loan of a shareholder or a loan from the Minister, where
the Minister has ownership powers. State-Owned Enterprises [No. 10 of 2026 449

of
equity or a loan of a shareholder or a loan from the Minister, where
the Minister has ownership powers. State-Owned Enterprises [No. 10 of 2026 449

29. (1) A board of a state-owned enterprise shall, where a state
owned enterprise is financially distressed, submit a business
restructuring plan outlining the actions which the state-owned
enterprise proposes to undertake to avoid the insolvency of that
state-owned enterprise to the—
(a) in the case of a state-owned enterprise, other than a
subsidiary, the Minister; or
(b) in the case of a subsidiary, a holding company or parent
company. (2) A holding company or parent company shall, on receipt of
a business restructuring plan in accordance with subsection (1)(b)—
(a) review the business restructuring plan and make a
recommendation on the action to be undertaken by a
subsidiary to avoid the insolvency of the subsidiary; and
(b) where necessary, inform the Minister of the financial
distress of the subsidiary. (3) The Minister shall, on receipt of the business restructuring
plan in accordance with subsection (1)(a) or information on the
financial distress of a subsidiary under subsection (2), review the
business restructuring plan or the information, as the case may be,
and make a decision on the action to be undertaken by the state-
owned enterprise or subsidiary.

ucturing plan or the information, as the case may be,
and make a decision on the action to be undertaken by the state-
owned enterprise or subsidiary.

(4) The Minister shall, where the business restructuring plan
referred to under this section involves privatisation, ensure that the
privatisation of a state-owned enterprise is conducted as prescribed
and in accordance with any other relevant written law. 30. (1) A board shall develop an investment policy with a
list of —
(a) assets that the state-owned enterprise holds or may
purchase; and
(b) ineligible assets or non-core assets. (2) The investment policy referred to under subsection (1) shall
reflect the core activities and core assets of a state-owned
enterprise. (3) A board shall submit the investment policy referred to under
subsection (1) for review and approval—
Investment
policy
450 No. 10 of 2026] State-Owned Enterprises
Restructuring

nvestment policy referred to under
subsection (1) for review and approval—
Investment
policy
450 No. 10 of 2026] State-Owned Enterprises
Restructuring

(a) in the case of a state-owned enterprise other than a
subsidiary, to the shareholders or the Minister, where
the Minister has ownership powers, at a meeting; or
(b) in the case of a subsidiary, to a holding company or parent
company. (4) A holding company or parent company shall, on receipt of
the investment policy in accordance with subsection (3)(b), submit
at a meeting the investment policy to the shareholders or the
Minister, where the Minister has ownership powers. (5) A state-owned enterprise shall, where the investment policy
referred to under this section relates to a major infrastructure or
natural resource investment project with capital requirements of
more than zero point zero five percent of nominal Gross Domestic
Product—
(a) require the commission of an independent feasibility study,
environmental and social impact assessment, and proof
of financial viability; and
(b) publish the notice of intention to undertake the activities
under paragraph (a), at least three months prior to the
commencement of the activities in the Gazette and an
official website of a state-owned enterprise. 31.

ragraph (a), at least three months prior to the
commencement of the activities in the Gazette and an
official website of a state-owned enterprise. 31.

(1) The shareholders of a state-owned enterprise shall, on
the recommendation of a board, approve by resolution, the amount
of declared dividends to be paid by a state-owned enterprise to the
shareholders. (2) The Minister shall, where the Minister has ownership
powers, on the recommendation of the board, approve the amount
of the distributable annual net profit to be declared and paid by a
state-owned enterprise to the Government. (3) A board shall, in considering whether to recommend the
declaration of dividends or distributable annual net profit under
subsection (1) and (2), consider various factors including the
solvency, liquidity position and future investment needs of the state-
owned enterprise. (4) Despite subsection (3), a holding company in which the
Government has ownership powers or sole ownership of shares
shall remit one hundred percent of the distributable annual net profit
to the Government. Dividends
and
distributable
annual net
profit
State-Owned Enterprises [No. 10 of 2026 451

nt of the distributable annual net profit
to the Government. Dividends
and
distributable
annual net
profit
State-Owned Enterprises [No. 10 of 2026 451

(5) Despite subsection (4), the Minister shall prescribe a ceiling
on the operational and capital cost for a holding company in which
the Government has ownership powers or sole ownership of shares. (6) A state-owned enterprise that declares dividends under
subsection (1) shall distribute the dividends out of distributable annual
net profit and remit the dividends to the shareholders within ninety
days after the approval of the distribution of dividends by the
shareholders. PART VIII
PUBLIC INTEREST SERVICE OBLIGATION
32. (1) A relevant ministry shall, where that relevant ministry
requires a state-owned enterprise to undertake a public interest
service obligation, write to the Minister requesting that a state-
owned enterprise undertakes the public interest service obligation. (2) Despite subsection (1), the Minister may, by statutory
instrument, limit the number of public interest service obligations
that a state-owned enterprise may undertake.

n (1), the Minister may, by statutory
instrument, limit the number of public interest service obligations
that a state-owned enterprise may undertake.

(3) The Minister shall, where the Minister, on receipt of the
request under subsection (1), determines that a state-owned
enterprise should provide the public interest service obligation, seek
approval from Cabinet for the state-owned enterprise to undertake
the public interest service obligation. (4) The Minister shall, where Cabinet grants approval for the
state-owned enterprise to undertake a public interest service
obligation, ensure that the Minister responsible for a relevant ministry,
the Minister and a state-owned enterprise referred to under
subsection (1), enter into a written agreement for the state-owned
enterprise to provide the public interest service obligation. (5) The written agreement referred to under subsection (4)
shall contain the following information:
(a) the nature and quality of the public interest service obligation
to be provided by the state-owned enterprise;
(b) costs and the parameters used to determine the costs to
be incurred by the state-owned enterprise for providing
the public interest service obligation;
(c) the fees to be charged by the state-owned enterprise for
the public interest service obligation;
Public
interest
service
obligation
452 No.

ation;
(c) the fees to be charged by the state-owned enterprise for
the public interest service obligation;
Public
interest
service
obligation
452 No.

10 of 2026] State-Owned Enterprises

10 of 2026] State-Owned Enterprises

(d) the payment modality to compensate a state-owned
enterprise, where the fees charged by the state-owned
enterprise are insufficient to cover the costs incurred
by a state-owned enterprise in providing the public
interest service obligation, as prescribed;
(e) conditions to be met for compensation under paragraph
(d); and
(f)any other information as prescribed. (6) The compensation referred to under subsection (5)(d) shall
be —
(a) limited to the public interest service obligation provided
by a state-owned enterprise; and
(b) proportional to the net cost of the public interest service
obligation provided by the state-owned enterprise. (7) The written agreement referred to under subsection (4)
shall be published in the Gazette and the official website of the
ministry responsible for finance. (8) The Minister shall, within thirty days of entering into the
agreement referred to under this section, submit the written
agreement to the National Assembly. 33.

er shall, within thirty days of entering into the
agreement referred to under this section, submit the written
agreement to the National Assembly. 33.

(1) A state-owned enterprise providing a public interest
service obligation may, where the provision of the public interest
service obligation is no longer necessary or feasible for public benefit,
provide the service on a commercial basis. (2) The Minister may prescribe the criteria for the regular
assessment of the continued necessity or feasibility of a public
interest service obligation for the purposes of subsection (1). (3) The assessment of the continued necessity or feasibility of
a public interest service obligation referred to under subsection (2)
shall be conducted at least every three years. PART IX
COMPETITIVE NEUTRALITY
34. (1) The Government shall—
(a) treat all state-owned enterprises and enterprises in the
private sector on a non-discriminatory basis; and
Transition
to
commercial
viability
Non-
discrimination
and
preferential
treatment
State-Owned Enterprises [No. 10 of 2026 453

iscriminatory basis; and
Transition
to
commercial
viability
Non-
discrimination
and
preferential
treatment
State-Owned Enterprises [No. 10 of 2026 453

(b) not give preferential treatment, or an undue advantage, to
a state-owned enterprise over an enterprise in the private
sector, or vice versa. (2) The Government shall not grant a state-owned enterprise
preferential—
(a) access to financing, including subsidies from equity, debt
or grants from the Government, a financial institution or
a bank in which the Government has direct ownership
or indirect ownership or another state-owned enterprise;
(b) access to pricing for land, natural resources, energy, utilities,
electronic communication spectrum or labour; or
(c) treatment in procurement and through a procuring entity. (3) Subject to subsection (2)(c) the Government shall ensure
a procuring entity provides equal treatment and non-discrimination
between state-owned enterprises and private bidders. 35. Financing of a state-owned enterprise by the Government,
a financial institution or a bank in which the Government has direct
ownership or indirect ownership shall be based on market terms. 36. Despite section 34, the Minister may, by statutory
instrument, in the interest of a public interest service obligation,
exempt a state-owned enterprise from the provisions of this Part.

y, by statutory
instrument, in the interest of a public interest service obligation,
exempt a state-owned enterprise from the provisions of this Part.

(2) The exemption referred to under subsection (1), shall be
limited and proportionate to the determined cost of the provision of
the public interest service obligation by a state-owned enterprise. PART X
MONITORING AND EVALUATION
37. A state-owned enterprise shall develop and implement a
strategic and business plan relating to the operations of a state-
owned enterprise. 38. (1) The shareholders, or Minister, where the Minister has
ownership powers, shall enter into a performance contract with a
board for the effective operation of the state-owned enterprise. (2) A performance contract referred to under subsection (1)
shall include—
Financing by
Government
Exemption
relating to
non-
discrimination
and
preferential
treatment
Strategic and
business
plan of
state-owned
enterprise
Performance
contract
454 No. 10 of 2026] State-Owned Enterprises

tion
and
preferential
treatment
Strategic and
business
plan of
state-owned
enterprise
Performance
contract
454 No. 10 of 2026] State-Owned Enterprises

(a) the mandate of the state-owned enterprise, including the
extent of public interest service obligation, where
applicable;
(b) key investments and activities to be undertaken by a state-
owned enterprise in accordance with the strategic and
business plan of the state-owned enterprise;
(c) an estimate of the amount of dividends to be distributed to
the shareholder;
(d) the financial and non-financial key performance indicators,
baseline and targets, in which the state-owned enterprise
shall be assessed by the shareholders, or Minister, where
the Minister has ownership powers, in relation to the
mandate of the state-owned enterprise;
(e) risk management and internal controls, strategies including
measures for safeguarding public assets; and
(f)monitoring and evaluation mechanism including frequency
of progress reporting. (3) A performance contract referred to under subsection (1)
shall be valid for three years.

ation mechanism including frequency
of progress reporting. (3) A performance contract referred to under subsection (1)
shall be valid for three years.

(4) A board shall submit to the shareholders, or Minister, where
the Minister has ownership powers, a proposed performance
contract or where the board intends to amend a performance
contract before its expiry, a draft proposed amended performance
contract, in writing, at least thirty days prior to when the proposed
performance contract or proposed amended performance contract
is intended to take effect. (5) A performance contract referred to under subsection (1)
shall be signed by the chairperson of a board and the shareholders
or the chairperson and the Minister, where the Minister has
ownership powers. (6) The targets referred to under subsection (2)(d) may be
integrated into the performance assessment of a chief executive
officer of a state-owned enterprise. 39. (1) A board shall, prior to the commencement of a financial
year, adopt an annual operating plan based on the strategic and
business plan and the performance contract. Annual
operating
plan
State-Owned Enterprises [No. 10 of 2026 455

perating plan based on the strategic and
business plan and the performance contract. Annual
operating
plan
State-Owned Enterprises [No. 10 of 2026 455

(2) An annual operating plan referred to under subsection (1)
shall take effect on the first day of the financial year to which the
plan applies. (3) A state-owned enterprise shall, every six months, submit a
report to the shareholders, or the Minister, where the Minister has
ownership powers, detailing progress made on the strategic and
business plan, performance contract and annual operating plan
referred to under this Part. 40. (1) The shareholders or Minister, where the Minister has
ownership powers, shall, every six months of a financial year,
evaluate and monitor the implementation of a performance contract
of a state-owned enterprise. (2) A board shall evaluate and monitor the performance
contract of a chief executive officer. PART XI
GENERAL PROVISIONS
41. The shareholder, or Minister, where the Minister has
ownership powers, may dissolve a board of a state-owned enterprise
where the board fails to—
(a) have a financial statement of a state-owned enterprise
audited for two years by an external auditor in
accordance with section 22(3); and
(b) meet targets in the performance contracts as prescribed. 42.

se
audited for two years by an external auditor in
accordance with section 22(3); and
(b) meet targets in the performance contracts as prescribed. 42.

The provisions of the Public Debt Management Act, 2022,
shall apply to the contraction of debt by a state-owned enterprise. 43. The Minister may, where there is inconsistency between a
provision of this Act and a provision of the Banking and Financial
Services Act, 2026, the Insurance Act, 2021 and the Securities
Act, by statutory instrument, exempt a state-owned enterprise from
a provision of this Act if that state-owned enterprise is regulated
under the —
(a) Banking and Financial Services Act;
(b) Insurance Act; or
(b) Securities Act. Monitoring
and
evaluation of
performance
contract
Dissolution
of board
Contraction
of debt by
state-owned
enterprise
Act No. 15
of 2022
Exemption
from
provision of
Act
Act No. 9 of
2026
Act No. 38 of
2021
Act No. 9 of
2026
Act No. 38
of 2021
Cap 354
Cap 354
456 No. 10 of 2026] State-Owned Enterprises

provision of
Act
Act No. 9 of
2026
Act No. 38 of
2021
Act No. 9 of
2026
Act No. 38
of 2021
Cap 354
Cap 354
456 No. 10 of 2026] State-Owned Enterprises

44. (1) The Department shall keep and maintain a register of
state-owned enterprises. (2) A register referred to under subsection (1) may be in
electronic form. (3) The register referred to under subsection (1) shall —
(a) contain prescribed particulars and information; and
(b) be kept at the office of the Department and shall be open
for inspection to members of the public during normal
office hours. (4) The Director may, on an application by a person, issue to
the person a certified extract from the register on payment of a fee
that the Director may determine. 45. (1) The Director shall, cause copies of a register, and any
alterations of, or additions to, the register referred to under section
44 to be printed and published in the Gazette and a daily newspaper
of general circulation in the Republic or any other electronic media
that the Director may determine. (2) Subject to this Act, a copy of the last printed and published
register is prima facie evidence in legal proceedings of what is
contained in that register and the absence of any name of a state-
owned enterprise from the copy shall be prima facie evidence
that the state-owned enterprise is not incorporated. 46.

absence of any name of a state-
owned enterprise from the copy shall be prima facie evidence
that the state-owned enterprise is not incorporated. 46.

An action or other proceedings shall not lie or be instituted
against a director or member of staff of the Department in respect
of, an act or thing done or omitted to be done in good faith in the
exercise or performance of any of the powers, functions or duties
conferred under this Act. 47. Where an offence under this Act is committed by a body
corporate or unincorporate body, with the knowledge, consent or
connivance of a director, manager or shareholder of that body
corporate or unincorporate body, that director, manager or
shareholder is liable, on conviction, to the penalty specified for that
offence. 48. (1) A person commits an offence if that person—
(a) obstructs, assaults, insults, hinders or delays an officer of
the Department in the lawful exercise of the powers
conferred on that officer under this Act;
Register
Publication
of copies of
register
Immunity
Offence by
principal
officers of
body
corporate or
unincorporate
body
General
offences
State-Owned Enterprises [No. 10 of 2026 457

f
register
Immunity
Offence by
principal
officers of
body
corporate or
unincorporate
body
General
offences
State-Owned Enterprises [No. 10 of 2026 457

(b) knowingly makes, or causes to be made, to the Director
or any staff of the Department, false information in any
material particular; or
(c) breaches the fiduciary duties of director. (2) A person who contravenes subsection (1) commits an
offence and is liable on conviction to a fine not exceeding two
hundred thousand penalty units or to imprisonment for a term not
exceeding two years, or to both. 49. (1) The Department shall, in the performance of its functions
under this Act, issue guidelines that are necessary for the better
carrying out of the provisions under this Act. (2) The Department shall cause to be published the guidelines
issued under this Act in the Gazette and in a daily newspaper of
general circulation in the Republic or any other electronic media
that the Department may determine. (3) The guidelines published under subsection (2) shall bind
the persons regulated under this Act. 50. (1) The Minister may, in consultation with the Department,
by statutory instrument, make Regulations for the better carrying
out of the provisions of this Act.

inister may, in consultation with the Department,
by statutory instrument, make Regulations for the better carrying
out of the provisions of this Act.

(2) Despite the generality of subsection (1), the Regulations
made under that subsection may provide for the—
(a) restructuring or privatisation of a state-owned enterprise;
(b) criteria for the regular assessment of the continued
necessity or feasibility of a public interest service
obligation;
(c) method for compensating a state-owned enterprise for
performing a public interest service obligation;
(d) corporate governance code for state-owned enterprise;
or
(e) any other information required to be prescribed under this
Act. 51. (1) The Self-Management Enterprises Act is repealed. (2) Despite subsection (1), the Fourth Schedule applies to the
savings and transitional provisions. Guidelines
Regulations
Repeal of
Cap. 408 and
savings and
transitional
provisions
458 No. 10 of 2026] State-Owned Enterprises

transitional provisions. Guidelines
Regulations
Repeal of
Cap. 408 and
savings and
transitional
provisions
458 No. 10 of 2026] State-Owned Enterprises

(3) Despite subsection (1), the Minister shall, within two years
from the date of commencement of this Act, review all State
institutions to determine which State institutions are state-owned
enterprises and update the register of state-owned enterprises kept
and maintained under this Act. (4) A statutory corporation that is primarily engaged in market
production or commercial activity shall, within six months from the
date of commencement of this Act, comply with the provisions of
this Act. (5) Subject to section 7(3), an existing state owned enterprise
which is not incorporated under the Companies Act shall, within
three years from the date of commencement of this Act, be
incorporated in accordance with the Companies Act and comply
with this Act. (6) A state-owned enterprise shall, with the approval of the
Minister, within three years from the date of commencement of
this Act, divest from non-core assets to assets that meet the
mandate of the state-owned enterprise.

thin three years from the date of commencement of
this Act, divest from non-core assets to assets that meet the
mandate of the state-owned enterprise.

(7) The Minister shall, in collaboration with the Minister
responsible for commerce, trade and industry, within two years
from the commencement of this Act, publish a competition impact
review of legislation relating to a state-owned enterprise with an
implementation timetable to repeal or amend law and practises
that distort competition in favour of state-owned enterprises. Cap. 388
Cap. 388
State-Owned Enterprises [No. 10 of 2026 459

r amend law and practises
that distort competition in favour of state-owned enterprises. Cap. 388
Cap. 388
State-Owned Enterprises [No. 10 of 2026 459

FIRST SCHEDULE
(Section 2)
CRITERIA FOR INDEPENDENT NON-EXECUTIVE DIRECTOR
An independent non-executive director shall meet the following
criteria:
(a) is capable of unbiased and objective decision making in
the interest of the state-owned enterprise;
(b) has not been employed by the state-owned enterprise,
including its major shareholders, in the past five years;
(c) is not an adviser or consultant to a state-owned enterprise
and is not affiliated with a company that is an adviser or
consultant to a state-owned enterprise;
(d) is not affiliated with a significant customer or supplier of a
state-owned enterprise, including a bank or other financial
institution owned by any of the major shareholders;
(e) has no personal service contracts with a state-owned
enterprise or its senior management;
(f)is not affiliated with a non-profit organisation that receives
significant funding from a state-owned enterprise;
(g) is not employed as a chief executive officer of another
company where a director of a state-owned enterprise
serves on that company’s board;
(h) is not a member of the immediate family of an individual
who is, or has been during the past five years, employed
by the state-owned enterprise as an executive officer;
(i) is not, nor in the past five years has been, affiliated with or
employed by a present or former auditor of a state-owned
enterprise; and
(j)is not an executive officer of a state-owned enterprise or
that person’s relative, surviving spouse, in-law, heir,
legatee and successor of any of the foregoing or the
executor.

of a state-owned enterprise or
that person’s relative, surviving spouse, in-law, heir,
legatee and successor of any of the foregoing or the
executor.

Criteria for
independent
non-
executive
director
460 No. 10 of 2026] State-Owned Enterprises

SECOND SCHEDULE
(Section 15(6) (b))
REQUIREMENTS FOR FIT AND PROPER PERSON
The shareholders, or Minister, where the Minister has ownership powers,
shall, for the purpose of determining whether a person proposed to be appointed
as director is a “fit and proper person”, take into account the following criteria:
(a) has the skills, knowledge and experience required for decision making
in the interest of a state owned enterprise;
(b) holds a degree or its equivalent, recognised by the Zambia Qualifications
Authority;
(c) is a business-person of repute or a recognised professional with relevant
sectoral experience;
(d) is financially sound;
(e) has good reputation and exhibits high ethical standards;
(f) is not disqualified to act as a director under this Act or any other
relevant written law; and
(g) has not been subject to an order made by the Securities and Exchange
Commission or any other regulatory body, withdrawing or refusing
to grant any licence or approval to that person which has a bearing
on the capital market.
State-Owned Enterprises [No. 10 of 2026 461

ing or refusing
to grant any licence or approval to that person which has a bearing
on the capital market.
State-Owned Enterprises [No. 10 of 2026 461

THIRD SCHEDULE
(Section 15 (8))
ADMINISTRATION OF A STATE-OWNED ENTERPRISE
1. (1) Subject to the other provisions of this Act, a director
of a board shall hold office for a term of three years and may be
re- appointed for a further term of three years. (2) Despite subparagraph (1), a director is eligible for re-
appointment after six years of serving the two terms referred to
under that paragraph. (3) A board shall, at least nine months before the expiry of a
performance contract, advise the shareholders or Minister, where
the Minister has ownership powers, the expiration date of the
performance contracts of the board or a director. (4) A director shall, on the expiration of the term for which the
director is appointed, continue to hold office until another director
is appointed, but in no case shall the further period exceed four
months.

ch the
director is appointed, continue to hold office until another director
is appointed, but in no case shall the further period exceed four
months.

(5) In addition to the provisions of the Companies Act, the office
of a director shall become vacant, where that director—
(a) is absent, without reasonable excuse, from three
consecutive meetings of the board of which the director
has had notice, without prior approval of the board;
(b) is convicted of an offence under this Act or any written
law and is sentenced to imprisonment for a term
exceeding six months without the option of a fine;
(c) is adjudged bankrupt;
(d) is found guilty of professional misconduct;
(e) is legally disqualified from performing the functions of a
director; or
(f)holds a position in a political party. (6) The shareholders, or Minister, where the Minister has
ownership powers, shall, where the office of a member of a board
becomes vacant, appoint another person in place of the member of
a board who vacates office and the member appointed shall hold
office for a term of three years and may be re-appointed for a
further term of three years. Tenure and
vacancy of
office of
director
Cap. 388
462 No. 10 of 2026] State-Owned Enterprises

d may be re-appointed for a
further term of three years. Tenure and
vacancy of
office of
director
Cap. 388
462 No. 10 of 2026] State-Owned Enterprises

Proceedings
of board
2. (1) Subject to the other provisions of this Act, a board may
regulate its own procedure. (2) A board shall meet for the transaction of business at least
once every three months at a place and time as the board may
determine. (3) There shall preside at a meeting of a board—
(a) the chairperson;
(b) in the absence of the chairperson, the vice-chairperson; or
(c) in the absence of the chairperson and the vice-chairperson,
a director as the directors present may elect for the
purposes of that meeting. (4) A shareholder, or Minister, where the Minister has
ownership powers, may be represented by a proxy at a general
meeting. (5) A board shall cause minutes to be kept of the proceedings
of every meeting of a board and of every committee of the board. 3.

t a general
meeting. (5) A board shall cause minutes to be kept of the proceedings
of every meeting of a board and of every committee of the board. 3.

(1) A person who is present at a meeting of a board or any
committee of a board at which a matter is the subject of
consideration, and in which matter that person or that person’s
relative or associate is directly or indirectly interested in a private
capacity shall, as soon as is practicable after the commencement
of the meeting, declare that interest and shall not, take part in a
consideration or discussion of, or vote on, a question relating to that
matter. (2) A disclosure of interest made under this paragraph shall be
recorded in the minutes of the meeting at which the disclosure is
made. 4. (1) A person shall not, without the consent, in writing, given
by, or on behalf of, a state-owned enterprise publish or disclose to
an unauthorised person, other than in the course of duties of that
person, the contents of a document, communication or information
which relates to or which has come to the knowledge of that person
in the course of that person’s duties under this Act.

communication or information
which relates to or which has come to the knowledge of that person
in the course of that person’s duties under this Act.

(2) A person who contravenes subsection (1) commits an
offence and is liable, on conviction, to a fine not exceeding two
hundred thousand penalty units or to imprisonment for a term not
exceeding two years, or to both. Disclosure
of interest
Prohibition
of
publication
or disclosure
of
information
to
unauthorised
person
State-Owned Enterprises [No. 10 of 2026 463

(3) A person who, having information which to that person’s
knowledge has been published or disclosed in contravention of
subsection (1), unlawfully publishes or communicates the information
to another person, commits an offence and is liable, on conviction,
to a fine not exceeding two hundred thousand penalty units or to
imprisonment for a term not exceeding two years, or to both.
464 No. 10 of 2026] State-Owned Enterprises

ding two hundred thousand penalty units or to
imprisonment for a term not exceeding two years, or to both.
464 No. 10 of 2026] State-Owned Enterprises

FOURTH SCHEDULE
(Section 51 (2))
SAVINGS AND TRANSITIONAL PROVISIONS
1. (1) A person who, before the commencement of this Act,
was an employee of a state owned enterprise shall continue to be
an employee of a state-owned enterprise, as if employed in
accordance with this Act. (2) The service of the persons referred to in subparagraph (1)
shall be treated as continuous service. (3) Nothing in the Act affects the rights and liabilities of any
person appointed or employed by the state-owned enterprise before
the commencement of this Act. 2. (1) A person who immediately before the commencement
of this Act held office as a director shall continue to hold office as
a director for a period of two years after which the shareholders,
or Minister, where the Minister has ownership powers, shall appoint
the directors in accordance with this Act.

two years after which the shareholders,
or Minister, where the Minister has ownership powers, shall appoint
the directors in accordance with this Act.

(2) Subject to subparagraph (1), every deed, bond or agreement,
other than an agreement for personnel service, to which a state-
owned enterprise was a party immediately before the
commencement of this Act, whether or not of a nature that rights,
liabilities and obligations could be assigned, shall, unless its subject
matter or terms make it impossible that it should have effect as
modified, as provided under this paragraph, have effect as if—
(a) the state-owned enterprise had been party to it;
(b) for any reference to a state-owned enterprise there was
substituted, with respect to anything falling to be done
on or after the commencement of this Act, a reference
to a state-owned enterprise; or
(c) for any reference to any officer of a state-owned enterprise,
not being a party to it and beneficially interested, there
were substituted, as respects anything falling to be done
on or after the commencement of this Act, a reference
to that officer of a state-owned enterprise, as a state-
owned enterprise shall designate. Staff of
state-owned
enterprise
Director of
board
State-Owned Enterprises [No. 10 of 2026 465

nterprise, as a state-
owned enterprise shall designate. Staff of
state-owned
enterprise
Director of
board
State-Owned Enterprises [No. 10 of 2026 465

3. (1) Any legal proceedings or application of a state-owned
enterprise pending immediately before the commencement of this
Act by or against a state-owned enterprise, may be continued by
or against a state-owned enterprise.
(2) After the commencement of this Act, proceedings in
respect of any right, liability or obligation which was vested in, held,
enjoyed, incurred or suffered by a former state-owned enterprise
may be instituted by or against a state-owned enterprise.
Legal
proceedings
466 No. 10 of 2026] State-Owned Enterprises