Mixed feelings trail new company law

Mixed reactions have continued to greet the newly signed amended version of Nigeria’s Companies and Allied Matters Act (CAMA) 2020.

President Muhammadu Buhari had on August 7, 2020 signed into law the Companies and Allied Matters Act (amendment) Bill (“CAMA”).

Daily Trust observed that while some Nigerians have hailed the amended legislations, some others have raised alarm that the law confers much power on the Corporate Affairs Commission (CAC).

An expert review by Samuel Olufowose, revealed key amendments in CAMA 2020. Among these is that: one person may form and incorporate a private company; small companies with a single shareholder are now exempted from requirement to hold AGMs.

The CAMA 2020 provided the prohibition of the formation or incorporation of a company for unlawful purpose, introduction of Limited Liability Partnership which provides more potent legal protection afforded companies to partnerships.

“The CAMA 2020 has been lauded widely since its passage for allowing ease of doing business and enticing SMEs, start-ups and ultimately encouraging innovations,” Olufowose said.

The Nigeria Economic Summit Group in its review said, “the Companies and allied matters act 2020 removes unnecessary requirements for small companies.”

Minister of Industry, Trade and Investment, Otunba Richard Adebayo, is optimistic that the implementation of the CAMA would help Nigeria move up the ladder of the World Bank’s Ease of Doing Business Index as the law would further dismantle bottlenecks in business registration in the country.

However, the Socio-Economic Rights and Accountability Project (SERAP) said the legislation may be the most repressive law in Nigeria’s history.

“This legislation may be the most repressive law in Nigeria’s history. Details on our findings and potential legal action later,” it revealed on its twitter handle.

Registrar General of CAC, Garba Abubakar, said the amendment of CAMA was the first review of the law in the last 20 years. “It will go a long way in bringing a better governance structure for most of the companies and if we do well, companies don’t have to submit their own articles for registration.”