Ohada Articles 30 and 30-1

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On February 16, 2024, the new articles 30 and 30-1 of the OHADA  Uniform Act of 17 October 2023 organizing simplified recovery procedures and enforcement measures came into force.   These articles read as follows : 

Article 30

There can be no forceful enforcement or protective measures against legal entities governed by public law, in particular the State, local authorities and public establishments.

However, any debt which is certain, due and owing by legal persons under public law, shall give rise to a set-off against debts which are also certain, due and owing them, subject to an agreement of reciprocity.

The debts of the persons referred to in the preceding Paragraph may only be considered certain, within the meaning of this Article where they arise from either an acknowledgement by them of such debts or from a writ which is enforceable within the territory of the State where the persons are located.

This article 30 allows for direct compensation with e.g. taxes to be paid to the Government or, otherwise, the sale of the debt claim to a third party who pays an amount of taxes equal to the debt claim (in one or more years to come).

To avoid the creation of a market where such secondary debt claims would be bought and sold, a new article 30-1 has been created.

Article 30-1

Any debt established by a writ of execution or arising from an admission of indebtedness by a legal entity governed by public law, in particular the State, a local authority or a public institution may, after formal notice served on the governing body or competent authority in each State party without success for three (3) months from the date of notification, be automatically included in the accounts for the financial year and in the budget of the said legal entity, as compulsory expenditure.

The request for registration shall be sent to the Minister of Finance, together with supporting documents for the claim and a formal notice.

Claims registered following a request for compulsory registration shall automatically bear interest at the legal rate in force from the date of formal notice.

Hence, anyone holding a valid claim on the DRC, can now simply request to be paid within the ongoing fiscal year by means of a mandatory payment.

However, until now, the DRC still refuses to exectue its own law and requests for payment based on article 30-1 are simply ignored.