NON-PERFORMING ASSETS (LOANS,
INVESTMENTS) RECOVERY ACT, 1996
(ACT 518)
ARRANGEMENT OF SECTIONS
PART I—ESTABLISHMENT OF TRUST, ITS
OBJECTS AND FUNCTIONS
Section
1. Establishment of the Trust.
2. Objects of the Trust.
3. Transfer of Non-Performing
Assets.
4. Action by Trust in Respect of
Transferred Assets.
5. Vesting of Transferred Assets.
6. Establishment of Non-Performing
Assets Recovery Fund.
7. Powers of the Trust.
8. The Board of Trustees.
9. Functions of the Board.
10. Meetings of the Board.
11. Committees of the Trust.
12. Chief Administrator.
13. Staff of the Trust.
14. Protection of Trustees
Employees of the Trust.
PART II—ESTABLISHMENT OF LOANS
15. Establishment of Tribunal.
16. Composition of the Tribunal.
17. Jurisdiction and Power of
Tribunal.
18. Judgment of Tribunal and
Execution of Judgment.
19. Procedure of Tribunal.
20. Registrar and Other Staff of
Tribunal.
21. Expenses and Allowances.
22. Obstruction of Tribunal.
PART III—FINANCIAL AND
MISCELLANEOUS PROVISIONS
23. Accounts and Audit.
24. Annual Report.
25. Tax Relief.
26. Payments of Proceeds into the
Consolidated Fund.
27. Regulations.
28. Interpretation.
29. Repeal.
30. Vesting of Assets and
Transfers.
31. Duration of Act.
THE FIVE HUNDRED AND EIGHTEENTH
ACT OF THE PARLIAMENT OF THE
REPUBLIC OF GHANA
ENTITLED
THE NON-PERFORMING ASSETS (LOANS,
INVESTMENTS) RECOVERY ACT, 1996
AN ACT to establish the
Non-Performing Assets Recovery
Trust and for related matters.
DATE OF ASSENT: 11TH SEPTEMBER,
1996
PART I—ESTABLISHMENT OF TRUST, ITS
OBJECTS AND FUNCTIONS
Section 1—Establishment of the
Trust.
(1) There is hereby established a
body to be known as the
Non-Performing Assets Recovery
Trust referred to in this Act as
"the Trust".
(2) The Trust shall be a body
corporate with a common seal and
may sue and be sued in its
corporate name.
(3) The Trust may for the
discharge of its functions under
this Act acquire, hold and dispose
of any movable or immovable
property or enter into any
contract or transaction.
Section 2—Objects of the Trust.
The objects of the Trust are—
(a) to hold for and on behalf of
the State any non-performing asset
of a bank which is transferred to
the Trust under this Act;
(b) to take such action as may be
necessary to recover the amounts
outstanding in respect of the
transferred non-performing asset;
and
(c) to administer and manage the
Non-Performing Assets Recovery
Fund established under this Act.
Section 3—Transfer of
Non-Performing Assets.
Notwithstanding any law or
agreement to the contrary, any
bank in Ghana shall at the
direction in writing of the Trust
transfer to the Trust such of its
non-performing assets—
(a) as are in existence at the
commencement of this Act; or
(b) as may exist as determined by
the audited account of the bank on
the 31st day of December, 1989 if
the loans and advances or equity
investments were actually on the
books of the bank on the 30th day
of June, 1987, even if not
identified or determined at that
time to be non-performing.
Section 4—Action by Trust in
Respect of Transferred Assets.
The Trust shall in respect of any
non-performing asset transferred
by a bank under section 3 of this
Act cause to be paid to the bank
for the transferred asset from the
Fund established under section 6
of this Act such sum as may be
determined by the Trust—
(a) at such rate;
(b) in such form; and
(c) subject to such other terms
and conditions as the Trust may
determine.
Section 5—Vesting of Transferred
Assets.
The assets, rights and obligations
attached to a non-performing asset
transferred by a bank under this
Act which immediately before the
date of the transfer, were held by
that bank shall vest in the Trust.
Section 6—Establishment of
Non-Performing Assets Recovery
Fund.
(1) There is hereby established a
Non-Performing Assets Recovery
Fund referred to as "the Fund"
into which shall be paid the
monies provided by the Government
or other sources to the Trust and
proceeds from recoveries made on
assets vested in the Trust.
(2) There shall be paid out of the
Fund by the Trustees such sums of
money as may be required by the
Trust under this Act.
Section 7—Powers of the Trust.
(1) The Trust shall exercise such
powers and take such actions as it
considers advantageous or
necessary for or in connection
with the achievement of its
objects under this Act.
(2) Subject to subsection (1) of
this section the Trust may—
(a) sell at the best price
possible, enterprises or ventures
the subject of any transferred
non-performing assets or the
assets of the enterprises or
ventures;
(b) take such actions as may be
necessary for the recovery of
non-performing assets;
(c) negotiate and reschedule
payments of the transferred
non-performing assets;
(d) take any other action which is
incidental to the objects of the
Trust.
Section 8—The Board of Trustees.
(1) The governing body of the
Trust shall be a Board of Trustees
referred to in this Act as “the
Board".
(2) The Board shall consist of the
following members appointed by the
President acting in consultation
with the Council of State—
(a) a Chairman;
(b) a representative of the
Ministry of Finance;
(c) a representative of the Bank
of Ghana;
(d) the Chief Administrator of the
Trust;
(e) a chartered accountant from
the private sector;
(f) a lawyer knowledgeable in
corporate law from the private
sector; and
(g) three other persons with sound
knowledge or experience on matters
pertaining to the objects of the
Trust at least one of whom shall
be from the private sector.
(3) There shall be a Vice-Chairman
of the Board who shall be
appointed from members by the
President acting in consultation
with the Council of.
(4) The members of the Board shall
hold office for the duration of
the Trust but the membership may
be renewed for such further
periods as the President may
determine.
(5) A member of the Board, other
than an ex-officio member may
resign his office by writing
addressed to the President through
the Minister and the President may
remove a member from the Board for
stated reasons.
(6) The members of the Board shall
be paid such allowances as may be
determined by the Board with the
approval of the Minister for
Finance.
Section 9—Functions of the Board.
The Board of Trustees shall be
responsible for the formulation of
policies and the supervision of
the management of the Trust and
shall exercise the powers
conferred on the Trust under this
Act.
Section 10—Meetings of the Board.
(1) The Board shall meet for the
despatch of business at such times
and places as the Board may
determine but shall meet at least
once in every.
(2) At every meeting of the Board
at which he is present, the
Chairman shall preside but in his
absence the Vice-Chairman shall
preside.
(3) Decisions of the Board shall
be determined by a simple majority
of members present and voting and
in the event of equality of votes
the Chairman or the person
presiding shall have a second or
casting vote.
(4) The quorum at any meeting of
the Board shall be six.
(5) The Board may at any time
co-opt any person to act as an
adviser at its meeting, but the
co-opted person may not vote on
any matter for decision of the
Board.
(6) Any member of the Board who
has an interest financial or
otherwise, whether direct or
indirect, in any undertaking which
is the subject matter of a
decision before the Board, shall
disclose in writing to the Board
the nature of his interest and
shall not participate in any
discussion or decision of the
Board relating to the matter.
(7) Any member of the Board who
fails to disclose his interest
under subsection (6) of this
section commits an offence and
shall be removed from the Board,
and shall on conviction be liable
to a fine not exceeding ¢500,000
or to imprisonment for a term not
exceeding six months.
(8) Except as otherwise provided
in this section the Board shall
regulate its own procedure.
Section 11—Committees of the
Trust.
The Board may appoint committees
to perform such functions or
advise the Board on such matters
as the Board may direct.
Section 12—Chief Administrator.
(1) There shall be appointed by
the President in accordance with
the advise of the Board given in
consultation with the Public
Services Commission a Chief
Administrator of the Trust.
(2) The Chief Administrator shall
hold office on such terms and
conditions as shall be specified
in his letter of appointment.
(3) The Chief Administrator shall,
subject to such directions as may
be given by the Board be
responsible for the day-to-day
administration of the Trust and
shall be accountable to the Board.
Section 13—Staff of the Trust.
(1) The Trust may from time to
time engage such employees,
consultants and advisers as may be
necessary for the proper and
efficient performance of its
functions under this Act.
(2) Appointment of staff of the
Trust shall be made by the
President in accordance with the
advice of the Board given in
consultation with the Public
Services Commission.
(3) Other public officers may be
transferred or seconded to the
Trust.
Section 14—Protection of Trustees
Employees of the Trust.
Subject to article 293 (2) of the
Constitution no act of a Trustee
or a staff member of the Trust
shall where the act was done in
good faith in the course of his
employment, subject the employee
or any person acting under his
direction, personally, to an
action, liability or claim.
PART II—ESTABLISHMENT OF LOANS
Recovery Tribunal
Section 15—Establishment of
Tribunal.
There is hereby established a
tribunal to be known as the
Non-Performing Assets Recovery
Tribunal referred to in this Act
as "the Tribunal".
Section 16—Composition of the
Tribunal.
The Tribunal shall consist of—
(a) a Chairman who shall be a
judge of the Superior Courts not
below the rank of a Justice of the
Court of Appeal or a person
qualified to be appointed to that
office; and
(b) two other persons who shall be
appointed by the President in
accordance with the advice of the
Chief Justice given in
consultation with the Public
Services Commission.
Section 17—Jurisdiction and Power
of Tribunal.
(1) The Tribunal shall have
original exclusive jurisdiction to
hear and determine matters arising
under this Act or relating to any
non-performing asset transferred
to the Trust under this Act.
(2) The Tribunal shall in the
exercise of its jurisdiction under
this Act have the powers of a High
Court of Justice and for that
purpose the civil procedure rules
applicable to civil actions before
the High Court shall apply to
actions before the Tribunal.
Section 18—Judgment of Tribunal
and Execution of Judgment.
(1) Judgments and orders of the
Tribunal shall be executed and
enforced in the same manner as
judgments and orders of the High
Court.
(2) The Tribunal may review its
own judgment or orders.
(3) The Supreme Court shall have
supervisory jurisdiction over the
Tribunal.
Section 19—Procedure of Tribunal.
(1) The Tribunal shall in the
exercise of its functions under
this Act be guided by the rules of
natural justice.
(2) Without prejudice to the
general effect of subsection (2)
of section 17 of this Act the
Tribunal shall in the discharge of
its functions under this Act have
the powers of a High Court of
Justice in respect of—
(a) enforcing the attendance of
witnesses and examining them on
oath, affirmation or otherwise;
(b) compelling the production of
documents; and
(c) the issue of a commission or
request to examine witnesses
abroad.
(3) The Tribunal shall at any time
be deemed to be duly constituted
if the Chairman and one other
member are present.
(4) Any decision shall be deemed
to be a decision of the Tribunal
if it is supported by a majority
of the members.
(5) A witness before the Tribunal
shall have the immunities and
privileges as if he were a witness
before the High Court.
Section 20—Registrar and Other
Staff of Tribunal.
(1) The President shall in
consultation with the Chief
Justice appoint an officer to be
designated as the Registrar for
the Tribunal.
(2) The President shall appoint
staff for the Tribunal in
accordance with the advice of the
Chief Justice given in
consultation with the Public
Services Commission.
Section 21—Expenses and
Allowances.
The members of the Tribunal, the
Registrar and staff of the
Tribunal shall be paid such
remuneration and allowances as the
Minister may determine.
Section 22—Obstruction of
Tribunal.
(1) Any person who—
(a) when summoned to attend a
witness before the Tribunal,
refuses to attend or fails without
reasonable excuse to attend; or
(b) being in attendance as a
witness refuses to take an oath or
to make an affirmation required by
the Tribunal; or
(c) makes any statement before the
Tribunal which he knows to be
false or which he has no reason to
believe to be true; or
(d) omits or suppresses any
information required by the
Tribunal in the discharge of its
functions or relevant to the
discharge of those functions; or
(e) in any manner misleads,
obstructs, insults or disturbs the
Tribunal,
commits an offence and is liable
on conviction to a fine not
exceeding ¢500,000.00 or to
imprisonment for a term not
exceeding six months or to both.
PART III—FINANCIAL AND
MISCELLANEOUS PROVISIONS
Section 23—Accounts and Audit.
(1) The Trust shall keep books of
accounts and proper records in
relation to them and the books of
account and records of the Trust
shall be in a form approved by the
Auditor-General.
(2) The books of account of the
Trust shall be audited by the
Auditor-General within six months
after the end of each financial
year.
(3) The audited accounts shall be
submitted to the Board not later
than three months after the end of
the financial year to which they
relate.
(4) The Board shall as soon as
possible but in any case not later
than one month after receipt of
the report of the Auditor-General
forward the report to the Bank of
Ghana and the Minister.
(5) The financial year of the
Trust shall be the same as the
financial year of the Government.
Section 24—Annual Report.
The Board shall not later than
four months after the end of each
financial year submit to the
Minister an annual report on the
management of the Trust in respect
of that financial year and the
Minister shall submit the report
together with his observations on
it to Parliament.
Section 25—Tax Relief.
The Trust shall be exempted from
the payment of taxes, rates and
duties.
Section 26—Payments of Proceeds
into the Consolidated Fund.
The Trust shall transfer on a
quarterly basis into the
Consolidated Fund the proceeds
from recoveries made on assets
vested in the Trust and lodged in
the Fund.
Section 27—Regulations.
The Minister may by legislative
instrument make such regulations
as may be necessary for the
effective and full implementation
of this Act.
Section 28—Interpretation.
In this Act unless the context
otherwise requires—
"bank" means any bank in existence
in Ghana at the commencement of
this Act;
"Fund" means the Non-Performing
Assets Recovery Fund established
under this Act;
"Non-performing asset" means—
(a) loans and advances including—
(i)
any advances in respect of which
the principal or interest or
scheduled instalment thereof has
remained overdue for any period
specified by the Bank of Ghana by
notice or regulation then in
existence;
(ii) any advance to a borrower who
has subsequent to the granting of
the advance gone into insolvency
or whose industrial or commercial
operation has remained
unoperational for any period
specified by the Bank of Ghana by
notice or regulations;
(iii) any overdraft in respect of
which interest is due and unpaid
or the overdraft is outstanding
after the expiry of the
authorisation or is consistently
at or exceeding the credit limit
for such period as the bank of
Ghana may by notice or regulation
specify, or in respect of which
the credit limit is regularly
increased by the bank; or
(iv) any advance, overdrafts or
guarantees for which the borrower
is unable or unwilling to
discharge his obligation to
service the interest or principal
repayment; or
(b) investment in the nature of
equity holdings, debentures or
other commercial paper issued by a
corporate body in Ghana where—
(i)
the body has suffered losses which
in aggregate, exceed its paid up
capital and declared reserves and
surpluses; or
(ii) insolvency proceedings have
been initiated against the body;
or
(iii) the body's commercial or
industrial operations have
remained unoperational for a
period longer than a period
specified in notices or
regulations issued by the Bank of
Ghana and the marketability or
realizable value has been
substantially impaired exposing
the bank to risk of loss;
"Minister" means the Minister
responsible for Finance;
"Tribunal" means the
Non-Performing Assets Recovery
Tribunal established under this
Act.
Section 29—Repeal.
(a) The following enactment is
repealed—
Non-Performing Assets (Loans,
Investments) Recovery Law, 1990 (P.N.D.C.L.
242);
(b) The following instruments are
revoked—
Non-Performing Assets (Loans,
Investments) Recovery Instrument
1992 (L.I. 1533); and
Non-Performing Assets Recovery
Tribunal (Adaptation to
Constitution) Instrument, 1993
(C.I. 3).
Section 30—Vesting of Assets and
Transfers.
(1) There shall be vested in the
Trust the assets, rights,
obligations and liabilities of the
Non-Performing Assets Recovery
Trust established under the
Non-Performing Assets Recovery
Trust Law, 1990 (P.N.D.C.L. 242).
(2) There shall be transferred to
the Fund the monies in the
Non-Performing Assets Recovery
Fund established under the
Non-Performing Assets Recovery
Trust Law, 1990 (P.N.D.C.L. 242).
(3) Any appointment made under the
repealed enactment shall on the
coming into force of this Act
remain as if made under the
corresponding provision of this
Act until otherwise dealt with
under this Act.
Section 31—Duration of Act.
This Act shall continue in force
until the 30th day of June, 1997
and shall then expire unless
Parliament extends its duration
for a further period.
Date of Gazette Notification: 11th
October, 1996.
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