Oil-and-Gas is hot in Ghana. No doubt you and your neighbour are hopeful (even if distantly) to get into the action. Are you curious about whether local content requirements are aiding Ghanaian individuals and companies to participate and make it big in Ghana’s baby petroleum industry or how? This article will tell you about four areas set apart by the local content law for only Ghanaians to operate or provide services in, unless no Ghanaian entities exist which can provide such services.
Oil and Gas companies must – and will – always insure their risks. Look into it if you own or know someone who owns a Ghanaian insurance company. Insurance services for petroleum activities can only be provided by Ghanaian insurance companies. Your insurance company is Ghanaian if you (as owner or owners) hold at least fifty-one percent of the shares. If a company in the industry finds no Ghanaian insurance companies able to insure their risks, then they may obtain the approval of the National Insurance Commission to look outside Ghana for an insurer.
2. Financial Services
You’re in luck if you are a financial services institution or organisation, and at least fifty-one percent of your shares are held by Ghanaian nationals. You’re a Ghanaian company, and a company engaged in petroleum activities can obtain financial services from only banks like you. If a financial institution or syndicate of institutions cannot be found with deep-enough pockets, the company may look outside Ghana, but only with the express approval of the Petroleum Commission.
3. Legal Services
You can’t participate in petroleum activities in Ghana without needing legal services. You will enter into contracts of all sorts (food, transport, accommodation, employment, etc). You can only engage Ghanaian lawyers or firms of Ghanaian lawyers to provide the legal services you need in Ghana as they relate to your activities. If you’re a law firm or lawyer, and haven’t yet become interested in oil and gas, maybe it’s time to take baby steps in getting the capacity. A law firm hired in connection with oil and gas operations in Ghana must have its principal office in Ghana. Unlike insurance and financial firms, eligible law firms must be fully owned by Ghanaians.
4. Non-Managerial Roles in Ghanaian Joint-Venture Partner Companies
As a foreign company, if you want to provide goods and services in the petroleum industry, you can’t do it alone. You must form a joint-venture company with an ‘indigenous’ company. An indigenous company is Ghana-incorporated, and has least fifty-one percent share ownership by Ghanaian nationals.
If you own an indigenous company or are involved in one, it’s a good time to position yourself to be seen by foreign companies who want to participate in the provision of goods and services. Note that eighty percent of your senior executive and managerial positions must be held by Ghanaian nationals, and all your non-managerial roles must be filled by Ghanaian nationals.
Thus, all the non-managerial roles in indigenous companies who join up with foreign companies to provide goods and services are reserved for Ghanaian nationals only.
As you’ve just discovered, insurance, legal and financial services can ordinarily only be provided by Ghanaian entities. And Ghanaian entities providing goods and services, which join with foreign companies, must fill all their non-managerial roles with Ghanaian nationals.