Section 524, The Companies Act, 2009

(1) Where– (a) a person has, while a director of a company- (i) persistently failed to comply with this Act; (ii) persistently failed to take all reasonable steps to obtain compliance with this Act by the company; (iii) been guilty of fraud in relation to the company or of a breach of duty to the company or a shareholder; (iv) acted in a reckless or incompetent manner in the performance of his duties as director; (b) a person who, while being a director of a company was wholly or substantially responsible for the company– (i) being wound up because of its inability to pay its debts as and when they become due; (ii) ceasing to carry on business because of it inability to pay its debts as and when they become due; (iii) entering into a scheme of compromise or arrangement with its creditors, the court may, on application make an order that the person shall not, without the leave of the court, be a director or promoter of, or in any way, whether directly or indirectly, be concerned or take part in the management of a company for a period not exceeding 5 years as may be specified in the order. (2) Where within the period of 7 years before the making of an application under this section a person is a director of two or more companies to which subparagraphs (i), (ii), (iii) of paragraph (b) of subsection (1) apply, the court may make an order that the person may not be a director or promoter of or in any way directly or indirectly be concerned in the management of a company for such period not exceeding 5 years as may be specified in the order unless that person satisfies the court– 380 381 Arbitration. Court may disqualify (a) that he was not wholly or substantially responsible for the insolvency of those companies; or (b) that it would not be just or equitable for the power to be exercised. (3) A person intending to apply for an order under this section shall give not less than 10 days’ notice of that intention to the person against whom the order is sought, and on the hearing of the application the last-mentioned person may appear and give evidence or call witnesses. (4) An application for an order under this section may be made by the Commission, or by the liquidator of the company, or by a person who is, or has been, a shareholder or creditor of the company; and on the hearing of– (a) an application for an order under this section by the Commission or the liquidator; or (b) an application for leave under this section by a person against whom an order has been made on the application of the Commission or the liquidator, the Commission or liquidator shall appear and call the attention of the court to any matters which seem to it or him to be relevant and may give evidence or call witnesses. (5) An order may be made under this section even though the person concerned may be criminally liable in respect of the matters on the ground of which the order is to be made. (6) The Registrar of the court shall, as soon as practicable after the making of an order under this section, give notice to the Commission that the order has been made and the Registrar shall publish in the Gazette and in two publications in a local newspaper the name of the person against whom the order is made. (7) Every person who acts in contravention of an order under this section commits an offence and is liable to a fine not exceeding Le5,000,000 or to imprisonment for a term not exceeding one year or to both the fine and imprisonment.