100+ Free GSL Company & Commercial Practice Practice Questions

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Sample GSL Company & Commercial Practice Practice Questions

Try these sample questions to test your GSL Company & Commercial Practice exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Under Section 11 of the Companies Act, 2019 (Act 992), within what timeframe must a company ratify a pre-incorporation contract after its formation to assume rights and liabilities under it?

A.Within 18 months

B.Within 12 months

C.Within 6 months

D.Within 24 months

Explanation: Section 11 of the Companies Act, 2019 (Act 992) allows a company to ratify a pre-incorporation contract within 18 months after its formation. If the company ratifies the contract within this period, it becomes bound by and entitled to the benefits of that contract as if the company had been in existence at the date of the contract. If not ratified within 18 months, the contract cannot be ratified, and personal liability remains on the person who entered into it.

2Which of the following describes the legal relationship between a promoter and the company they are engaged in forming under Ghanaian company law?

A.A fiduciary relationship

B.A relationship of principal and agent

C.A partnership relation

D.A simple contractual debtor-creditor relationship

Explanation: A promoter stands in a fiduciary relationship with the company they are engaged in forming, as established under Section 10 of Act 992. This fiduciary relationship requires the promoter to act in good faith, avoid conflicts of interest, account for any property received, and disclose any secret profits made. This duty continues until the company is formed and has raised its necessary working capital.

3In the landmark Ghanaian case of Morkor v Kuma [1998-99] SCGLR 620, what guiding principle did the Supreme Court reinforce regarding the piercing of the corporate veil?

A.The corporate veil will only be pierced where the company was used as a sham, device, or to commit fraud.

B.The corporate veil can be pierced whenever it is economically convenient for the creditors.

C.A sole shareholder is always personally liable for all the debts of the company.

D.The court can pierce the corporate veil at any time without any proof of wrongdoing.

Explanation: In Morkor v Kuma, the Supreme Court of Ghana reinforced that the corporate veil will not be lightly pierced. It will only be lifted where the corporate personality is being used as a sham or mask to evade a legal obligation, or to commit fraud, or where the director/shareholder has treated the company's assets as their personal property, causing a failure of separate corporate identity.

4Under the Companies Act, 2019 (Act 992), what is the minimum number of directors that every company registered in Ghana must have at all times?

A.Two directors

B.One director

C.Three directors

D.Five directors

Explanation: Section 171 of the Companies Act, 2019 (Act 992) provides that every company incorporated in Ghana must have at least two directors, one of whom must ordinarily be resident in Ghana. If the number of directors falls below two, the remaining director may act only to appoint another director or to call a general meeting for that purpose.

5What is the minimum age requirement for a person to be appointed as a director of a company under the Companies Act, 2019 (Act 992)?

A.18 years

B.21 years

C.16 years

D.25 years

Explanation: Under Act 992, the minimum age to be appointed as a director of a company is 18 years. This was a reform from the previous Companies Act, 1963 (Act 179) which set the minimum age at 21 years. A director must also be a natural person of sound mind.

6What is the maximum number of shareholders that a private company limited by shares is permitted to have in Ghana, excluding employees and former employees of the company?

A.50 shareholders

B.20 shareholders

C.100 shareholders

D.Unlimited

Explanation: Under Section 7 of the Companies Act, 2019 (Act 992), a private company must restrict the number of its members to a maximum of 50. This limit excludes joint holders of shares (who are counted as one member) and persons who are in the employment of the company or were members while in that employment.

7Which of the following is a key legal distinction between a private company and a public company under the Companies Act, 2019 (Act 992)?

A.A public company may invite the public to acquire its shares or debentures, whereas a private company is prohibited from doing so.

B.A public company must have at least three directors, while a private company only needs one.

C.A private company does not require a company secretary, whereas a public company does.

D.Only public companies are corporate bodies with separate legal personalities.

Explanation: Under Section 7 of Act 992, a private company's constitution must restrict the transfer of its shares and prohibit the company from making an invitation to the public to acquire shares or debentures. Public companies, on the other hand, are permitted to make public invitations and list their shares on a stock exchange.

8Under the Companies Act, 2019 (Act 992), when an application for name reservation is made, for how long is the approved name reserved by the Registrar?

A.30 days

B.60 days

C.90 days

D.180 days

Explanation: Section 22(3) of Act 992 provides that a reservation of a company name 'shall not exceed two months' (approximately 60 days) and may be renewed for a further period of two months. While the reservation subsists, no other company can be registered under that reserved name or a name the Registrar considers similar to it.

9Which of the following is a mandatory restriction governing a company limited by guarantee under Section 8 of the Companies Act, 2019 (Act 992)?

A.It cannot pay dividends or make distributions of profit to its members.

B.It must have a share capital of no par value shares.

C.It is exempt from the requirement of appointing an auditor.

D.Its membership is restricted to a maximum of 20 persons.

Explanation: Under Section 8 of Act 992, a company limited by guarantee is not incorporated for the purpose of making profits for its members. The Act strictly prohibits the payment of dividends or return of capital to its members. All profits and property must be applied solely to the promotion of the objects of the company.

10What statutory declaration is required from the directors and promoters of a company during the application for incorporation under Section 13 of the Companies Act, 2019 (Act 992)?

A.A statutory declaration that they have not been convicted of an offence involving dishonesty, fraud, or company management in the preceding five years.

B.A statutory declaration that the company will guarantee a minimum profit in its first year.

C.A declaration confirming that the company holds land in Ghana.

D.A declaration that the company has a minimum of 50 shareholders.

Explanation: Under Section 13 of Act 992, applicants for incorporation must submit a statutory declaration by each proposed director and promoter stating that they have not, within the preceding five years, been convicted of an offence involving dishonesty, fraud, or in connection with the promotion or management of a body corporate, or been declared insolvent.

About the GSL Company & Commercial Practice Exam

The Company and Commercial Practice course is a core professional subject at the Ghana School of Law (GSL) for professional law students (PLC). Designed to bridge the gap between academic theory and practical corporate law, it focuses heavily on the Companies Act, 2019 (Act 992) which governs modern company registration and management in Ghana. Additionally, it covers business name registration under Act 151, incorporated partnerships under Act 152, commercial transactions under the Sale of Goods Act, 1962 (Act 137), and general principles of commercial agency and contract drafting. This practice exam bank includes 100 high-quality multiple-choice questions structured to test practical knowledge across the entire corporate and commercial syllabus.

Assessment

Question count not published by the exam provider

Time Limit

3 hours (180 minutes) per paper. This practice bank is designed for untimed self-study.

Passing Score

50% for each paper in the Professional Law Course (PLC) examinations. Candidates failing three or more subjects must repeat the year.

Exam Fee

Examination/registration fees are GHS 1,500.00. The general tuition fee for the Professional Law Course (Part I) is GHS 22,415.00. Confirm rates on the official IEC portal. (Independent Examinations Committee (IEC) of the General Legal Council (GLC) of Ghana)

GSL Company & Commercial Practice Exam Content Outline

20%

Company Formation and Incorporation

Procedures for incorporation, registration requirements, promoters' liability, pre-incorporation contracts, and company names under Act 992.

20%

Corporate Governance and Administration

Roles, duties, liabilities, appointment and removal of directors; company secretaries and auditors; board and general meetings under Act 992.

20%

Share Capital, Debentures and Membership

Allotment of shares, capital structure, dividends and capital maintenance, debentures, share transfer, and shareholder remedies/minority protection.

15%

Sole Proprietorships and Partnerships

Registration under the Registration of Business Names Act, 1962 (Act 151) and partnership incorporation under the Incorporated Private Partnerships Act, 1962 (Act 152).

15%

Commercial Transactions and Agency

Commercial contracts, legal due diligence, sale of goods under the Sale of Goods Act, 1962 (Act 137), and principles of commercial agency.

10%

Corporate Restructuring, Litigation and Liquidation

Procedures for winding up, receivership, schemes of arrangement, mergers, and resolving disputes under the Companies Act, 2019.

How to Pass the GSL Company & Commercial Practice Exam

What You Need to Know

Passing score: 50% for each paper in the Professional Law Course (PLC) examinations. Candidates failing three or more subjects must repeat the year.
Assessment: Question count not published by the exam provider
Time limit: 3 hours (180 minutes) per paper. This practice bank is designed for untimed self-study.
Exam fee: Examination/registration fees are GHS 1,500.00. The general tuition fee for the Professional Law Course (Part I) is GHS 22,415.00. Confirm rates on the official IEC portal.

Keys to Passing

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GSL Company & Commercial Practice Study Tips from Top Performers

1Understand the key procedural shifts introduced by Act 992, such as the requirement of a statutory declaration by directors/secretaries, and the separation of the Office of the Registrar of Companies (ORC) from the Registrar-General's Department.

2Memorize the mandatory qualifications and duties of a Company Secretary under Section 190 of the Companies Act, 2019 (Act 992).

3Be prepared to distinguish clearly between the legal status of an incorporated partnership under Act 152 (which has separate legal personality once registered) and a registered business name/sole proprietorship under Act 151 (which does not).

Frequently Asked Questions

What is the primary legislation tested in the Company and Commercial Practice exam?

The primary legislation is the Companies Act, 2019 (Act 992), which regulates all companies in Ghana. Other essential statutes include the Incorporated Private Partnerships Act, 1962 (Act 152), the Registration of Business Names Act, 1962 (Act 151), and the Sale of Goods Act, 1962 (Act 137).

What is the pass mark and grading system for the GSL Professional Law Course exams?

A score of 50% is required to pass each individual paper. If a candidate fails one or two papers, they may be referred to retake those specific papers. Failing three or more papers results in a complete fail of the academic year, requiring the candidate to repeat all courses.

How long is the Company and Commercial Practice exam?

The examination administered by the Independent Examinations Committee (IEC) is a 3-hour (180 minutes) written test consisting of a mix of scenario-based problems, advice questions, and legal drafting exercises.

What are the common legal documents tested for drafting in this exam?

Candidates are frequently required to draft board and general meeting notices, agenda lists, company resolutions (ordinary and special), partnership agreements, agency agreements, and company registration forms for the Office of the Registrar of Companies (ORC).

100+ Free GSL Company & Commercial Practice Practice Questions

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