To open a new HR&S CountryBranch

HR&S Sweden establishes HR&S Country Branches in Sub-Sahara African countries. The Branches represents HR&S Sweden in the country, and develop relations with Institution managements, local authorities and other relevant stakeholders. The Branches also manage RISE Centres, which provide support to local social entrepreneurs, researchers and innovators in order to empower them to offer their products and services to the local community.

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Starting a new HR&S Country Branch

Company registration guidelines

Company limited by guarantee. The HR&S Country Branches are initially registered in each country as a company limited by guarantee during the start-up phase.

Name
The name is usually “Human Rights & Science Branch Name of country”, or something similar depending on the rules of the country.
Alternatively the name can relate to the RISE Centre, such as HR&S RISE Support Centre Name of Country, or RISE Support Name of Country, or Research, Innovation and Social Enterprising Support Center Name of Country, etc.

Directors
The company is by law required to have at least one director. The HR&S Country Branch must have three Directors who are also the signatories of the bank account, usually the team-leader, the deputy team-leader and the accountant.

Capital
The capital required to always be available on the Branch account must be stated for the different countries. This is the amount that also has to be shown to the government if the company closes down.
Zambia: 15,000 Kwatcha, about USD 800.

Income generation for the sake of sustainable economy
We generate income to cover running costs, team member reimbursement and company growth investments. We do not transfer funds to share-holders (we do not have external share-holders) or bonuses to branch directors.

Bank account signatories
The company opens a bank account as soon as it has been registered. The HR&S Country Branch bank account must have three
signatories, the same as the company directors.

RISE Centre
The RISE Centre is one of the HR&S Country Branch activities.

Tax exemption
The HR&S Country Branch may be tax exempted during the early start-up phase, while the size of the capital is still small. This is made possible, in some countries, as a result of being registered as a company limited by guarantee.

start-up

The purpose with the company during the start-up phase is

  1. To have access to a separate bank account.
  2. To be able to handle company finances, a limited amount of company capital.
  3. To manage ActioInvest.
  4. To manage the RISE Centre.
  5. To be registered as a company in order to walk the talk.

The Directors /signatories of the Country Branch are members of the Country Branch Team of Operations during the start-up phase.

Scaling up

As soon as the Branch generates enough income to sustainably be able to cover all costs including, reimburse team-members and have a significant capital (different from ActionInvest) on the account, it is time to register a company limited by shares. At this time the country Branch and HR&S Sweden will discuss the set-up in detail.

About Companies limited by guarantee

A company limited by guarantee is a limited company, but with the difference to the usual company entity of there being no share capital. The company’s members are guarantors rather than shareholders. The same rules and regulations apply to companies limited by guarantee as to companies with a share capital. This means that the company will have to file accounts at the appropriate national institution within the usual deadline, file annual returns, keep proper accounting records, appoint directors and file returns with appropriate national institution. The main difference between a company limited by guarantee and one limited by shares is that the liability of shareholders is limited to the amount unpaid on shares, whereas the liability of guarantors (the members of a company limited by guarantee) is limited to the amount that they guaranteed. In most cases, the amount guaranteed will be around Euro 1 (in local curency) per member (similar to the ordinary Euro 1 share in a company limited by shares). Members cannot receive dividends, and will usually be involved due to their commitment to the company’s objectives, rather than to benefit financially. The memorandum and articles will usually differ from those of the standard share capital company and will generally include a defined list of specific objectives, and also a clause that prohibits the distribution of surplus profits. The balance sheet of a company limited by guarantee will be the same as that of a company limited by shares, apart from the fact that it will have no share capital. The bottom section of the balance sheet should be headed ‘Reserves’ rather than the usual ‘Shareholders’ funds’. There is no requirement, but it is common practice, to also include a note disclosing the guarantees; something simple such as: ‘The company is limited by guarantee of members and does not have a share capital. The liability of members is limited to Euro 1 (in local currency). The usual rules about related parties will apply, and the director(s) will be related parties in the usual way. Whether or not a member falls into the definition of related party will depend on the circumstances. Payments to members can only be by way of remuneration, as no dividends are possible.

Company limited by shares
At a later stage a company limited by shares can be registered and are then sub-divisions of HR&S Sweden.