Remedies for Misstatement in a Prospectus
Tips for Young Investors
We conclude our recent series on the imminent delistment of seventeen companies from the board of the Nigerian Stock Exchange by looking at various provisions in the Investment and Security Act 2007 relating to the prospectuses that companies issue when they want to raise capital by offering securities to the public. We do this because other raised funds by selling equity shares or other securities to the public. For example, Daar Communications had a well publicized initial public offer in 2008 during which it did both an offer for subscription and an offer for sale. Starcomms Plc in the same period had a well publicized private placement exercise during which some of its initial private equity investors cashed out. Investment and Allied Insurnace Plc, FTN Cocoa Process Plc, Big Treat and Mtech Plc were other companies which became quoted on the Nigerian Stock Exchange after public offers or private placements.
Part IX of the Investment and Securities Act regulates the public offer and sale of securities and invitations to the public. In subsection 68, the act states:
- A public company making an invitation to the public to deposit money with it shall, prior to the making of the invitation, obtain the written consent of the Commission and shall only make the invitation in accordance with such conditions and restrictions as may be imposed by the Commission.
- If any advertisement or circular used in connection ;with the invitation contains any untrue statement then, subject to subsection (4) of this section, any person who made the invitation and every person who was a director of a company making the invitation at the time when the advertisement or circular was published commits an offence and is liable on conviction to pay compensation to any person who deposited money with the public company having relied on the advertisement or circular, for any loss they may have sustained by reason of such untrue statement.
2: What are the historical origins of Human rights?
First, we can pose the question, what do we mean by human rights? Secondly, we can ask if they are a human invention or of divine origin, that is, do they inhere in us as human beings created by God? Are human rights some kind of free gifts that benevolent leaders can confer on us or withhold, depending on their caprice or our being of good behaviour? Is there a universal understanding or narrative of human rights that defy geography, religious belief and space? In other words, are human rights the full expression of what makes us human?
Finally, we could also pose the question, are human rights important for our survival? Or, to borrow a culinary metaphor, if they are important for our survival, are they an appetizer, the main meal or the dessert of life? So, if we were to rank them with other indicators of life, where would they be located? Do we lose anything by not knowing them or putting them into practice? Finally, some might even argue that we have lived without them, so why are they such a big issue now?
In principle, Human rights can be defined as those rights which we derive from the creator by virtue of being human beings. For us as Christians, we could stretch this further by arguing that their urgency derives from the fact that we were actually created in the image and likeness of God (Gen 1:27). These are God given rights and therefore, they cannot be taken away or generously given by the benevolence of some human authority, no matter their claims. However, we know that in real life, the struggle for domination and power have led human beings to treat others as being less human. The power elites have used colonialism, subjugation and control, enslavement, genocide, wars, human trafficking and conquest as a means of consolidating their power at the expense of others. Nations and groups have appropriated religion, class, race, gender and so on, as means of sustaining privilege, thus leading to the dehumanization of others. It is this dehumanization that creates the conditions and justifications for the violation of the rights of those considered to be less human and so on.
The scars and wounds of the devastating impact of slavery and colonialism are still somehow fresh in many minds and their impact is with us. On the continent of Africa, most civil wars today are the result of the fault lines created by the western colonial state and Arab slavery and conquests. The institutionalization and codification of apartheid in 1948 marked the turning point in this story of domination. This is why, most of the struggles across the African continent today are indeed struggles for human dignity either by entire nations, faith or ethnic communities and minority groups excluded by state policies from participating in the pursuit of their God given rights to human dignity.
The emergence of the United Nations’ Human Rights Declaration in 1948, three years after the savagery of the Second-world-war showed the world’s commitment to ending the seeming triumph of evil and good. The First World War was largely fuelled by sheer human folly and arrogance. Although it was dubbed the war to end all wars, after the loss of over 20 million people and catastrophic destruction of human life, it took less than thirty years for the second world war to erupt, and further deepen human misery and bestiality. The war had thrown up new weapons of death hitherto, unknown to humanity. The emergence and use of the machine gun, poison gas and armoured tanks during the war, opened the eyes of the powerful regarding the amount of damage that could be inflicted on humanity. This is why, at the end of the Second World War the number of casualties had almost tripled.
When the world realized the fact that the First World War could have been avoided, it decided to set up the League of Nations following the Paris Conference in 1919. In fairness the idea behind the League was noble and the founders did a lot of great work. However, their visions for world peace and justice focused on moral hopes that the powerful nations will act in the general interest. But things did not work out that way. Some of the lapses were taken care of when the United Nations came into being.
However, plausible as the 1948 Declaration on Human Rights is, we know that the history of human rights did not start from the Declaration and that indeed, we can argue that human rights have been as old as human existence. The key issues have really been the challenges of modern states, human developments, the rights of nations and individuals and the creation of new instruments of governance and modernization. The story of what is known in human rights studies as the Cyrus cylinder of Human rights is worthy of note. As its history goes, King Cyrus flew against the grain of what was political and culturally correct in his days when he decided to free all slaves after the conquest of Babylon in 593 BC. He allowed his people to exercise the right to worship gods of their choice. For the period under question, this was an incredible display of religious liberty thousands of years before the UN Declaration.
Subsequently, the Magna Carta, the Bill of Rights, the French and American revolutions along with the American Constitution have built on the historical belief that human freedom and human rights are indeed, divine and are therefore sacred. African reactions to the UN Declaration were curious. Not unexpectedly, African Heads of State believed that there was something special or peculiar about our view of life, the individual and the community and that the UN Declaration was Eurocentric. They domesticated the UN Declaration and renamed it, UN Declaration of Human and Peoples’ Rights, drawn extensively from the UN Declaration itself. Yet, African leaders have hardly shown any commitment to their willingness or commitment to extending the frontiers of human freedom for their people.
Much of what we can talk about human rights would have to go back to the days of the Civil Liberties Organisation founded by Mr Olisa Agbakoba which spawned many other human rights initiatives. Today, the story of the struggle for human rights has deteriorated into a whisper for two reasons. First, most of the civil rights activists saw the end of military dictatorship as the end of human rights violation and decided to leave politics to politicians. Secondly, they saw the return of democracy as the return to a culture of human rights and good governance. Now we know better.
With the return to democratic rule, the struggle for survival took its toll and many activists became corporate lawyers and focused their attention on earning a living from the Nigerian state which remains the domain of power and privilege. Today, the energy has waned and what we have now are single issues, such as Gender, Niger Delta, Security and so on around which all forms of individuals now congregate and struggle for access to resources. The spirit of dedication and volunteerism that drives human rights activism has all but gone.
Today, we can look back at the setting up of the Human Rights Violations Investigation Commission, HRVIC, chaired by Justice Oputa of blessed memory as one of the high points in the struggle for freedom. Sadly, it seemed that with all the good work done by the Commission and the high hopes it elicited from Nigerians, the project was a still birth because those in power were still stuck in a different time zone, preoccupied with raw power, privilege and position. Rather than talk about human rights, the Nigerian politician would rather speak of what has come to be known as the dividends of democracy, another name or excuse for what has become at best a criminal enterprise in the name of politics.
It is important to note that almost all the key actors in the struggle of yesterday, from Ken Saro Wiwa’s MOSOP, NADECO to CLO have moved notches higher in government positions. The Federal Government of Nigeria finally set up a National Human Rights Commission, NHRC in 1995 by an Act. It is significant to note that this took place under the administration of the muchvilified General Sani Abacha. The idea was to bring Nigeria up to speed with the resolution of the UN urging member nations to set up these Commissions to promote and protect human rights. It says on its website that: The Commission serves as an extra-judicial mechanism for the enhancement of the enjoyment of human rights. Its establishment is aimed at creating an enabling environment for the promotion, protection and enforcement of human rights. It also provides avenues for public enlightenment, research and dialogue in order to raise awareness on human rights issues.
The mere existence of these initiatives or institutions do not necessarily ensure the culture of human rights, nor do they guarantee the respect or the protection of minority rights in societies. What is necessary is for communities to apply the necessary strategies such as judicial activism to bring erring government to book or to appropriate the often laudable but unenforceable claims made by governments either to comply with international regulations or to pacify civil society and citizens. This is why I now wish to use the case of the struggle for minority and civil rights by the black people in the United States of America and those of South Africa as metaphors for understanding and appreciating how the struggle for these God given rights can be attained.
3: Lessons from Elsewhere: The struggle for human dignity, rights and equality in the United States of America.
Human history is replete with records of what is often referred to as man’s inhumanity to man. What is also often lost is the incredible sense of resilience of the human spirit in the face of tragedy and domination. The stories of conquests, despoliation and death in Africa and Asia are perhaps the greatest illustrations of the triumph of the human spirit. Although these may be the best examples in human memory, we often forget also that somehow, one generation of oppressed has often only risen to manifest the same oppression on others. These are the stories of empires and empire building. The logic of oppression, slavery and death remain basically the same.
It might therefore be more accurate to see the evil of oppression as residing in the human genie rather than attributing it to a particular group of persons or civilisations; the Arab, Western, Muslim or Christian. If we take this position, then the best option might be for us to examine how other societies survived these phases of oppression and try to avoid the mistake of yesterday’s victim becoming today’s oppressor. This is what stood Nelson Mandela out as an extraordinary human being. But as we are now seeing, post Mandela South Africa is facing some severe challenges and the nation is poised for a new kind of battle for redemption.
Before our very eyes, the ascension of both Nelson Mandela and Barrack Obama to the highest offices in their countries marked major turning points both in the history of their respective nations, and in the triumph of the human spirit. Very often, we focus on special individuals and forget to examine the other factors, individuals and events that shaped their emergence and their history to the exclusion of the foot soldiers.
I believe that unless we have the patience and discipline to carefully examine the nature of the footsteps that laid the foundation on which he has built, we will never understand how history is beckoning on us today. Here, I will like to draw attention to two key institutions without which we cannot have a conversation about human rights and human dignity. These are, the claims inherent in all Constitutions which aspire to building a humane society and the quality of the Judiciary, but especially the Supreme Court to interpret the Constitution. Then, there is the issue of human agency, namely, the lawyers whose necessary discipline, training and commitment to establishing a regime and culture of human rights can serve as a trigger to ignite the flames of justice. Often, the conditions of ordinary people can offer an opportunity to call public attention to the existence of injustice.
To be continued next week
Draft Text of a lecture delivered on the occasion of the 1st Dennis Osadebay Memorial Lecture at Nnebisi Hall, Grand Hotel, Asaba, Delta State, on May 31st, 2014 by Bishop Matthew Hassan Kukah, Catholic Diocese of Sokoto.