AMCON Act needs to be reviewed, says Bankole
Has the process of obtaining a C of O in Lagos improved? HE state governor said he has hastened the process, but the requirement is still stifling. They require you to bring so many things. When they list the requirements, it may take you a whole year or months to get them. At the ministry, they will start sending you from one office to the other. Unfortunately, some of the things they demand from you amounts to double taxation. In fact, I can call it extortion.
So, how does this impact real estate investment and businesses generally, considering that one needs C of O to collateralise a loan under the law?
First, banks will not grant you a loan unless you ‘ play ball’. You will also discover that the amount you will pay is usually more than 30 per cent of the loan obtained. So, which business do you want to do? The interest rate is high and at the end of the day, when you calculate all hidden charges, the cost skyrockets.
The most unfortunate is the act of putting a clause in the loan agreement indicating that it can be recalled at any time. Even when you are paying as and when due and there remains some small amount to discharge the loan, they will unreasonably recall it as if it’s not for business, and give you one or two weeks to fully repay it. While you are trying to discuss with them, they’ll sell the loan to Asset Management Company of Nigeria ( AMCON). Then AMCON will go to court ex parte and obtain an order for a receiver/ manager, who will come and evict everybody inside the building. This act foists great injustice to business people and contributes to crippling the economy.
How is this impacting the economy?
AMCON ought to help banks in ensuring that their loan obligations are fulfilled, but it is doing the opposite. It seems to be out to destroy companies that defaulted in loans, thereby killing the economy. I’m not supporting default in loan repayment. What I’m saying is that companies should be managed to stay afloat, not to die. Even the AMCON Act ought to be reviewed back to what it used to be, before the present amendment. The new amendment provides that ex parte applications will last till the end of a case, and you know that in Nigeria, a case may last for five or more years. The implication is that they will use such an ex parte order to take over your property. Again, a receiver/ manager’s job ought to be to manage the assets of a company taken over, but in the case of AMCON, they will chase everybody inside the property out, put a badge or seal on the building to scare clients away and bring in some hoodlums who will help to desecrate the property. That is not what AMCON is meant to be. They are supposed to keep the property well and manage it. They don’t need to drive anybody out. All they need to do is to write to the management of the company, informing it that they got an order and it should report to the receiver going forward as the new manager. Of course, anybody that fails to report can be dealt with, but once they report to you, you take over and continue to manage the asset in such a manner that monies realised can be used to offset debts and the excess returned to the owner. But AMCON enjoys commando- like operations, takes over properties, chases
Teverybody out of companies and allows miscreants to come in and ensure the structure depreciates. AMCON has been a big disappointment to the economy of the country.
In Lagos there is a law against land grabbing, but it appears it isn’t deterring land grabbers?
In fairness to the taskforce on land grabbing, they are doing their best. When they receive a petition, they must investigate it to see if it could be resolved before they act, but the attitude of the State government regarding lands is even more worrisome. The government issues a C of O in a land today and later takes over the same land and builds housing estates on it. But once a C of O has been issued, it means an allocation has been made to you, so the government should stay off. It can only be revoked under certain conditions.
Under what conditions can valid C of O be revoked?
If you don’t pay the necessary land use charges or develop the land within a certain time, the government reserves the right to revoke it. But in this case, the land is granted to you, you paid for the C of O and obtained it, then the Lagos State government shows up to take the land from you. Maybe, they have constructed a beautiful road that makes housing estates more appealing on that site.
Do you think influential politicians are the ones inducing the government to take such decisions?
I would not know, but the security of ownership of whatever the government grants to you should be guaranteed, not when after giving you a land with one hand, they collect all the charges, grant you C of O and now come to attempt to take the same land from you through revocation.
In the light of what you are saying, we have had a series of demolitions recently. Are the demolitions justified?
Truly, most of the properties where Lagos State government takes its bulldozer to, have no proper documentations. Some of them were built within the set back of canals, some have no documentation because they believe they will settle their way through. And once there is any little hitting up of the system, Lagos State government goes after them. It is when demolition starts that people will start making noise. Unfortunately, I believe that the state monitoring unit ought to stop such buildings at the foundation level. It is a huge waste of national resources, when you demolish after building.
How has the present economic reality impacted on legal practice in Nigeria?
The economy is quite harsh, generally. And legal practitioners are restricted from doing other businesses. From the angle of the rules of professional conduct, you cannot engage in trading. You cannot even manage a property. In some instances, you cannot be an agent, but can only involve yourself in preparation documents. So, it has narrowed down the areas of operation of legal practitioners.
And I see many young lawyers gravitating into other spheres of profession like chartered arbitrator, entertainment
a n d journalism. Some even go as far as becoming hairdressers because they see that at the end of the day, legal practice is not as rosy as they used to think.
What’s your assessment of Bola Tinubu’s government so far?
We that voted for him are confused because the sudden removal of fuel subsidy and the collapse of the naira really escalated the price of goods and services. Again, the fiscal policy of the CBN also withdrew so much cash from the system. Nigeria is beautiful, but we could not really operate properly because inflation was at a runaway degree. The monetary and fiscal policy muddled up the funds.
Recently, we started hearing some good news that the CBN had cleared off certain debts in billions of dollars. People are gradually readjusting to the present reality and the government has been trying to reassure the people that tomorrow will be good. The only area that we would not understand is the profligacy in Tinubu’s government. Nobody can beat his chest that he likes what the national assembly members are also doing in terms of their expenditures, the way they appropriate funds to themselves, is sad. They would have applied caution in profligacy when the masses are suffering.
Even if they had wanted to vote money for themselves for private vehicles, why not patronise Innoson or other locally assembled vehicles? Nobody knows the amount they collected. We now look at the lawmakers as if God has decided to send caterpillars and cankerworms to eat us up. I think that is not right.
Don’t forget that the executives have no control over the expenditures of the legislators immediately former President Muhammadu Buhari signed the presidential order for the legislative and judiciary’s financial autonomy. On their part, the executive seems not frugal too, especially when you look at the number of ministers that were appointed. But of late, the executive has started to make some decisions like you cannot travel out of the country anyhow or insisting on due diligence before money can be spent.
What’s your reaction about the killing of soldiers in Delta?
What happened in Delta State is really unfortunate. I sympathise with the Nigerian Army because what happened is condemnable by every right thinking human being. I think the military should also rise to improve military- civic relations. They must show that they are subject to civil authority despite the harm that has been unleashed on them by members of those communities. They should allow the law to take its course.
They should not take laws into their own hands.
Sanitation laws of Lagos seem to be in abeyance in certain areas of the state?
I think some areas in Lagos look like ungoverned spaces. The quantum of filth in some areas of Lagos is nauseating. In Lekki- Epe Expressway, starting from Ajah roundabout, there is filth everywhere, even at the median. It is just as if there is no local government in place or sanitation laws. Governor Sanwo- Olu should order sanity in the whole place because it stinks. Outside the city centre that is decent, other places desire some cleanliness. Again, it appears after swearing in the governor for a second term, the street lights went off. He should fix those desirable facilities in an aspiring mega city.