Regulations to implement the 2008 Indigenization and Economic Empowerment Act requiring local control of foreign firms doing business in Zimbabwe took effect on Monday amid rising concern the program will dash any interest investors might have in the country.
The regulations, promulgated recently, give companies with a value of more than US$500,000 45 days to report on the distribution of shareholdings.
Prime Minister Morgan Tsvangirai has declared the regulations null and void, saying the cabinet did not discuss them before they were gazetted. But President Robert Mugabe endorsed the indigenization program this weekend amid celebrations of his 86th birthday in Bulawayo, the country's second-largest city.
The Council of Ministers, chaired by Mr. Tsvangirai, was expected to examine the rules on Thursday.
The Zimbabwe Congress of Trade Unions criticized the drive to establish black majority control of foreign companies, saying indigenization will benefit just a few blacks who will replace minority whites.
ZCTU President Lovemore Matombo told VOA Studio 7 reporter Jonga Kandemiiri that the union fears a repeat of the land reform program launched in 2000 under which most of the agricultural assets seized from whites farmers ended up in the hands of an elite.
Businesswoman Marah Hativagone, director of the food processing ingredients company CodChem and a former president of the National Chamber of Commerce, said indigenization is desirable but added that the current initiative is poorly timed as it comes just as the economy is recovering its footing.