Malawi government is consulting stakeholders on the draft Companies Act expected to simplify formation and registration of companies.
Currently, it takes a long time for potential investors to register companies and government described this as frustrating.
This is one area that cause Malawi to fare badly on sustainable economic opportunity category of the 2012 Ibrahim Index of African Governance (2012 IIAG) despite the country being placed on position 17 out of 52 countries in Africa.
Malawi has also slipped six steps from 151 to 157 on World Bankâ€™s Ease of Doing Business 2013 (DB13).
But chief legislative assistant in the Ministry of Justice, Reyneck Matemba, said the new law is likely to improve the countryâ€™s business climate.
â€œThe incorporation of companies will be simplified with this draft bill and unnecessary complexity and delays in formation of companies will be minimised,â€ said Matemba at a company review workshop in Blantyre.
The workshop was aimed at soliciting views from both the public and private sectors on the bill.
Society of Accountants in Malawi (Socam) executive director Daniel Dunga commended for the reforms, saying they will improve business competitiveness in the country.
â€œThe Companies Act is a fundamental piece of legislation for the development of the business sector, creating conducive environment businesses and attracting foreign direct investment.
â€œIt is, therefore, important that all stakeholders contribute meaningfully for the act to contain the aspirations of all key players in the economy,â€ he said.
The act, among other things, looks at capital maintenance and shares, insolvency, corporate governance, reasonable care, skill and diligence and conflict of interest in companies.
To simplify doing business, Malawi formed the Malawi Investment and Trade Centre (MITC) to create a one-stop-shop for investors and passed Business Names Registration Bill which provides for a computerised registration system.