Section 6: Appointment of Managing Directors

6. Appointment of Managing Directors.—(1) Where the Federal Government has made an order under section 5 in respect of an establishment, it may appoint a Managing Director in respect of such establishment. (2) Upon the appointment of Managing Director in respect of an establishment, the administration and management of the affairs of the establishment shall vest in the Managing Director and any company or person or authority exercising or having the right to exercise, immediately before such appointment, any power or functions in relation to the establishment shall cease to exercise or to have the right to exercise such power or function. (3) The Managing Director shall— (a) hold office during the pleasure of the Federal Government ; (b) in the discharge of his functions, be subject to such orders and directions as the Federal Government or the Board may from time to time give in writing; and (c) receive such remuneration and be subject to such other terms and conditions of appointment and service as the Federal Government may determine. (4) The Managing Director appointed in respect of an establishment shall exercise and perform (a) if such establishment is owned or controlled by a company, all the powers and functions of the Board of Directors; and (b) if such establishment is owned or controlled by a person, all the powers and functions of that person. 1[6A. Constitution of Board of Directors, etc. —(1) Where the Federal Government has acquired under section 5 the whole or a majority portion of the shares of a managed establishment which is a company and is of the opinion that, in the interest of the shareholders of the managed establishment, it is necessary to do so, the Federal Government may, by order in writing, direct that a board of directors consisting of a Managing Director and such number of other directors as may be specified in the order be constituted in such managed establishment. (2) Where the Federal Government has made an order under sub­section (1) in respect of a managed establishment, the board of directors of such establishment shall be constituted within a period of sixty days from the date of the order. (3) Where the Federal Government has made an order under sub­section (1) in respect of a managed establishment,— (a) the Federal Government may nominate such number of directors, including the Managing Director, on the board of directors of the managed establishment as bears to the total number of directors, as nearly as may be, the same proportion as the aggregate face value of the shares owned by the Federal Government and by an institution owned or controlled by the Federal Government, including the Corporation referred to in sub­section (3) of section 13, hereafter in this section referred to as the Corporation, bears to the total issued share capital of the managed, establishment ; and (b) the other directors shall from time to time be elected by the members of the managed establishment, other than the Federal Government an institution referred to in paragraph and the Corporation, in general meeting in accordance with the Companies (Managing Agency and Election of Directors) Order, 1972 (P.O. No. 2 of 1972). (4) The Managing Director nominated under sub­section (3) shall be the chief executive of the managed establishment. (5) The board of directors of a managed establishment constituted under this section shall enter upon office on such date as the Federal Government may, by order in writing, appoint in this behalf and, upon their entering upon office as aforesaid,— (a) the Managing Director appointed under sub­section (1) of section 6 in respect of the establishment shall cease to hold office; (b) the management of the establishment shall cease to vest in the Corporation, and the management and administration of affairs of the establishment shall, subject to this section, stand transferred to the board of directors; and (c) the Managing Director nominated under sub­section (3) shall have such powers and functions as the board of directors may, from time to time, confer upon or entrust to him.] 1Ins. by the Hydrogenated Vegetable Oil Industry (Control and Development) (Amdt.) Ordinance, 1979 (17 of 1979), s. 2.

Effective date: 1973-01-01

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