Nigeria Companies and Allied Matters Re-Enactment BillAbbakin
The article provides principal insights to the newest Nigeria Companies and Allied Matters Bill 2018, The Companies and Allied Matters (Repeal & Re-Enactment) Bill 2018.
As part of its reformative plans for the Nigerian Business Environment, the Federal Government has, through its upper legislative house, the Senate, passed the Companies and Allied Matters Act (Repeal and Re-enactment) Bill in a bid to amend the country’s foremost business legislation.
Although the Bill will not become law until it is passed by the second federal legislative house, the House of Representatives, and assented to by the President, its importance prompts a need for awareness of imminent developments.
Highlights of the Companies and Allied Matters Bill 2018
The highlights of the new CAMA Bill are as follows:
- Introduction of Limited Partnerships & Limited Liability Partnerships as new business vehicles at the Federal level allowing partners combine the organizational flexibility already available to partnerships with the limited liability introduced to limit business risks and consequently fuel business development.
- Introduction of One Person Companies (“OPC”) & Single Directorship to drive the participation of MSMEs in the Country’s business space as, in addition to the fact that most businesses are owned and managed by individuals, the limited liability status which will be conferred on this person will help spur on more courageous business transactions.
iii. Abolition of Requirement of Attorney-General’s Consent to register Companies Limited by Guarantee and replacement of same with a duty of the Commission to cause the application to be advertised in three (3) national dailies.
This will allow non-governmental organizations to adopt the Companies Limited by Guarantee option without worrying about the bottlenecks that would arise as a result of the need to obtain the Attorney-General’s consent.
- Abolition of the Requirement of Company Secretaries for Private Companies in a bid to ensure smoother operation and management at reduced cost.
- Introduction of minimum Issued Share Capital to replace Authorized Share Capital to encourage increased investments and reduce the cost burden on MSMEs in the event of share capital alteration.
- Abolition of the Requirement of Annual General Meetings for Small Companies under the Act in a bid to lessen the regulatory burden on MSMEs which were, once operating as a registered company, required to hold AGMs in each year.
vii. Improved Company Rescue & Insolvency Regime which seeks to ensure that, on the one hand, viable businesses are rescued and on the other hand, that non-viable businesses can exit the market in good time.
In furtherance of this objective, the Bill seeks to introduce insolvency models on:
- Netting; and
- Company Voluntary Arrangement