Companies and Allied Matters Act

309 Pages·2008·0.64 MB·English

COMPANIES AND ALLIED MATTERS ACT
CHAPTER 59
LAWS OF THE FEDERAL REPUBLIC OF NIGERIA 1990

Contents

Part A
Companies

Part I Corporate Affairs Commission

Part II Incorporation of Companies and incidental matters

Part III Acts by or on behalf of Company

Part IV Membership of the Company

Part V Share Capital

Part VI Shares

Part VII Debentures

Part VIII Meetings and Proceedings of Companies

Part IX Directors and Secretaries of the Companies

Part X Protection of minorities against illegal and oppressive conduct

Part XI Financial Statement of Audit
Part XII Annual Returns

Part XIII Dividends and Profits

Part XIV Receivers and Managers

Part XV Winding-up of Companies

Part XVI Arrangements and Compromise

Part XVII Dealings in Companies Securities
The entire part (Section 541 – 623) has been repealed by section 263 (1)(d) of the
Investments and Securities Decree No 45 of 1999

Part XVIII Miscellaneous and supplemental

Part B

Business Names

Part C

Incorporated Trustees

Part D

Short Title

Schedules

COMPANIES AND ALLIED MATTERS ACT
CHAPTER 59
LAWS OF THE FEDERAL REPUBLIC OF NIGERIA 1990

2nd January 1990

An Act to establish the Corporate Affairs Commission, provide for the
incorporation of companies and incidental matters, registration of business names
and the incorporation of trustees of certain communities, bodies and associations.

Part A
Companies

Part I
Corporate Affairs commission

1. (1) There is hereby established under this Decree, a body to be known as the
Corporate Affairs Commission (in this Decree referred to as "the
Commission").

(2) The Commission shall be-

(a) a body corporate with perpetual succession and a common seal;

(b) capable of suing and being sued in its corporate name; and

(c) capable of acquiring, holding or disposing of any property, movable or
immovable, for the purpose of carrying out its functions.

(3) The headquarters of the Commission shall be situated in the Federal
Capital Territory, Abuja, and there shall be established an office of the
Commission in each State of the Federation.

2. The Commission shall consist of the following members, that is-

(a) a chairman who shall be appointed by the President, Commander-in
Chief of the Armed Forces on the recommendation of the Minister, being
a person who by reason of his ability, experience or specialised
knowledge of corporate, industrial, commercial, financial or economic
matters or of business or professional attainments would in his opinion
be capable of making outstanding contributions to the work of the
Commission;

(b) one representative of the business community, appointed by the
Minister on the recommendation of the Nigerian Association of
Chambers of Commerce, Industries, Mines and Agriculture;

(c) one representative of the legal profession, appointed by the Minister on
the recommendation of the Nigerian Bar Association;

(d) one representative of the accountancy profession, appointed by the
Minister on the recommendation of the Institute of Chartered
Accountants of Nigeria

(e) one representative of the Manufacturers Association of Nigeria,
appointed by the Minister on the recommendation of the Association;

(f) one representative of the Securities and Exchange Commission not
below the grade of a Director or its equivalent;

(g) one representative of each of the following Federal Ministries, that is-

(i) Trade and Tourisms,

(ii) Finance and Economic Development,

(iii) Justice,

(iv) Industry and Technology; and

(h) the Registrar-General of the Commission.

3. (1) Subject to the provisions of subsection (2) of this section, a person
appointed as a member of the Commission (not being an ex-officio member)
shall hold office for three years and shall be eligible for re-appointment for
one further term of two years.

(2) The minister may, with the approval of the President, Commander-in
Chief of the Armed Forces at any time remove any member of the
Commission from office if the Minister is of the opinion that it is not in the
interest of the Commission for the member to continue in office and shall
notify the member in writing to that effect.

(3) The members of the Commission except the Registrar-General shall be
part-time members of the Commission.
(4) Any member of the Commission shall cease to hold office if-

(a) he becomes of unsound mind or is incapable of carrying out his duties;

(b) he becomes bankrupt or has made arrangement with his creditors;

(c) he is convicted of felony or any offence involving dishonesty;

(d) he is guilty of serious misconduct relating to his duties; or

(e) in the case of a person possessed of professional qualifications, he is
disqualified or suspended (other than at his own request) from practising
his profession in any part of Nigeria by the order of any competent
authority made in respect of him personally.

4. Members of the Commission appointed under section 2 (a), (b), (c), (d), (e), (f),
(g), and (h) shall be paid such remuneration and allowances as the President,
Commander-in-Chief of the Armed Forces may, from time to time, direct.

5. (1) Subject to this section and section 26 of the Interpretation Act 1964, the
Commission may make standing orders regulating its proceedings.

(2) The Chairman shall preside at every meeting of the Commission but, in his
absence, the members present shall elect one of their number present to
preside at the meeting.

(3) The quorum for meetings of the Commission shall be five7

(4) The Commission may appoint any of its officers to act as Secretary at any
of its meetings.

6. (1) A member of the Commission who is directly interested in any company
or enterprise, the affairs of which are being deliberated upon by the
Commission, or is interested in any contract made or proposed to be made
by the Commission shall, as soon as possible after the relevant facts have
come to his knowledge, disclose the nature of his interest at a meeting of the
Commission.

(2) A disclosure, under subsection (1) of this section, shall be recorded in the
minutes of the Commission, and the member shall-

(a) not take part after such disclosure in any deliberation or decision of the
Commission with regard to the subject matter in respect of which his
interest is thus disclosed;
(b) be excluded for the purpose of constituting a quorum of the
Commission for any such deliberation or decision.

7. (1) The functions of the Commission shall be to-

(a) subject to section 541 of this Act, administer this Act including the
regulation and supervision of the formation, incorporation, registration,
management, and winding-up of companies under or pursuant of this
Act;

(b) establish and maintain a companies registry and offices in all the States
of the Federation suitably and adequately equipped to discharge its
functions under this Act or any other law in respect of which it is
charged with responsibility;

(c) arrange or conduct an investigation into the affairs of any company
where the interest of the shareholders and the public so demand;

(d) perform such other functions as may be specified by any law or
enactment; and

(e) undertake such other activities as are necessary or expedient for giving
full effect to the provisions of this Act.

(2) Nothing in this section shall effect the powers, duties or jurisdiction of the
Securities and Exchange Commission under the Securities and Exchange
Commission Act.

8. (1) There shall be appointed by the Commission, a Registrar-General who
shall be qualified to practice as a legal practitioner in Nigeria and has been
so qualified for not less than 10 years and in addition, has had experience in
company law practice or administration for not less than eight years.

(2) The Registrar-General shall be the chief executive of the Commission and
shall be subject to the directives of the Commission and shall hold office on
such terms and conditions as may be specified in his letter of appointment
and on such other terms and conditions as may be determined from time to
time, by the Commission with the approval of the National Council of
Ministers.

(3) The Registrar-General shall be the accounting officer for the purpose of
controlling and disbursing amounts from the fund established pursuant to
section 12 of this Act.
9. The Commission may appoint such other staff as it may deem necessary for the
efficient performance of the functions of the Commissions under or pursuant to
this Act.

10. Notwithstanding the provisions of any enactment to the contrary, a person
appointed to the office or Registrar-General under section 8 of this Act or a
person appointed under section 9 of this Act who is a legal practitioner shall,
while so appointed, be entitled to represent the Commission as a legal
practitioner for the purpose and in the course of his employment.

11. Service in the Commission shall be approved service for the purpose of the
Pensions Act and accordingly, officers and other persons employed in the
Commission shall in respect of their service in the Commission be entitled to
pensions, gratuities and other retirement benefits enjoyed by persons
holding equivalent grades int he public service of the Federation, so however
that nothing in this Act shall prevent the appointment of a person to any
office on terms which preclude the grant of a pension and gratuity in respect
of that office.

12. The Commission shall establish a fund which shall consist of such sums as
may be allocated to it by the Federal Government and such other funds as
may accrue to it in the discharge of its functions.

13. The Commission may, from time to time, apply the proceeds of the fund
established in pursuance of section 12 of this Act-

(a) to the cost of administration of the Commission;

(b) for re-imbursing members of the Commission or any committee
set up by the Commission for such expenses as may be authorised or
approved by the Commission, in accordance with the rate approved
in that behalf by the National Council of Ministers;

(c) to the payment of salaries, fees or other remuneration or
allowances, pensions and gratuities payable to the employees of the
Commission;

(d) for the maintenance of any property acquired or vested in the
Commission; and

(e) for, and in connection with, all or any of the functions of the
Commission under this Act.

14. (1) The Commission shall keep proper accounts and proper records in
relation thereto and shall prepare in respect or each year a statement of
accounts in such form as the National Council of Ministers may direct.
(2) The accounts of the Commission shall be audited not later than six
months after the end of the year by auditors appointed by the
Commission from the list and in accordance with guidelines supplied by
the Auditor-General of the Federation, and the fees of the auditors and
the expenses of the audit generally shall be paid from the funds of the
Commission.

(3) The Commission shall cause to be prepared, not later than 30th
September in each year, an estimate or the expenditure and income or
the Commission during the next succeeding year and when prepared
they shall be submitted through the Minister for approval by the
National Council of Ministers.

15. The Commission shall, not later than 30th June in each year, submit to the
National Council of Ministers, a report on the activities of the Commission
during the immediately preceding year and shall include in such report, the
audited accounts of the Commission.

16. The Minister may, with the approval or the National Council of Ministers,
make regulations generally for the purpose of this Act and in particular,
without prejudice to the generality of the foregoing provisions, make
regulations-

(a) prescribing the forms and returns and other information required
under this Part, that is, Part A of this Act;

(b) requiring returns to be made within the period specified therein by
any company or enterprise to which this Part, that is, Part A of this
Act applies; and

(d) prescribing any fees payable under this Part, that is, Part A of this
Act.

17. In this Part of this Act-

"Chairman" means the Chairman of the Commission; and "member"
means any member of the Commission, including the Chairman.

Part II
Incorporation of companies and incidental matters

Chapter I
Formation of Company

18. As from the commencement of this Act, any two or more persons may
form and incorporate a company by complying with the requirements of this
Act in respect of registration of such company.

19. (1) No company, association, or partnership consisting of more than
twenty persons shall be formed for the purpose of carrying on any
business for profit or gain by the company, association, or partnership,
or by the individual members thereof, unless it is registered as a
company under this Act, or is formed in pursuance of some other
enactment in force in Nigeria.

(2) Nothing in this section shall apply to-

(a) any co-operative society registered under the provisions of any
enactment in force in Nigeria; or

(b) any partnership for the purpose of carrying on practice-

(i) as legal practitioners, by persons each of whom is a legal
practitioner; or

(ii) as accountants, by persons each of whom is entitled by law to
practice as an accountant.

(3) If at any time the number of members of a company, association or
partnership exceeds twenty in contravention of this section and it carries
on business for more than fourteen days while the contravention
continues, every person who is a member of the company, association or
partnership during the time that is so carries on business after those
fourteen days shall be guilty of an offence and liable on conviction to a
fine of 25 for every day during which the default continues.

20. (1) Subject to subsection (2) of this section, an individual shall not join in
the formation of a company under this Act if-

(a) he is less than eighteen years of age; or

(b) he is of unsound mind and has been so found by a court in Nigeria
or elsewhere; or

(c) he is an undischarged bankrupt; or
(d) he is disqualified under section 254 of this Act from being a
director of a company.

(2) A person shall not be disqualified under paragraph (a) of subsection
(1) of this section, if two other persons not disqualified under that
subsection have subscribed to the memorandum.

(3) A body corporate in liquidation shall not join in the formation of a
company under this Act.

(4) Subject to the provisions of any enactment regulating the rights and
capacity of aliens to undertake or participate in trade or business, an
alien or a foreign company may join in forming a company.

21. (1) An incorporated company may be either a company-

(a) having the liability of its members limited by the memorandum to
the amount, if any, unpaid on the shares respectively held by them (in
this Act referred to as "a company limited by shares"); or

(b) having the liability of its members limited by the memorandum to
such amount as the members may respectively thereby undertake to
contribute to the assets of the company in the event of its being
wound up (in this Act referred to as "a company limited by
guarantee") or

(c) not having any limit on the liability of its members (in this Act
referred to as "an unlimited company").

(2) A company of any of the foregoing types may either be a private
company or a public company.

22. (1) A private company is one which is stated in its memorandum to be a
private company.

(2) Every private company shall by its articles restrict the transfer of its
shares.

(3) The total number of members of a private company shall not exceed
fifty, not including persons who are bona fide in the employment of the
company, or were while in that employment and have continued after the
determination of that employment to be, members of the company.

(4) Where two or more persons hold one or more shares in a company
jointly, they shall for the purpose of subsection (3) of this section, be
treated as a single member.