companies and allied matters act

330 Pages·2015·1.48 MB·English

by  Alao Omeiza

COMPANIES AND ALLIED MATTERS ACT

ARRANGEMENT BY PARTS
Part A: Companies
Incorporation of Companies
I Corporate Affairs Commission II
and incidental matters
Acts by or on behalf of
III Company IV Membership of the Company
V Share Capital VI Shares
Meetings and Proceedings of
VII Debentures VIII Companies
Protection of minorities
Directors and Secretaries of
IX X against illegal and oppressive
the Companies
conduct
XI Financial Statement of Audit XII Annual Returns
XII
I Dividends and Profits XIV Receivers and Managers
Arrangements and
XV Winding-up of Companies XVI Compromise
XVI Dealings in Companies XVIII Miscellaneous and
I Securities supplemental
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been repealed by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 B: Business Names
Part C: I ncorporated Trustees
Part D: Short Title

CITATION
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 Act, a body to be known as
the Corporate Affairs Commission (in this Act 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
reappointment 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 numbers
present to preside at the meeting.
(3) The quorum for meetings of the Commission shall be five
(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 affect 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

into the 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 immediate 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
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 undercharged 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.