Global forum on transparency and exchange of information for tax purposes peer reviews: Nigeria 2013 : phase 1: legal and regulatory framework.

92 Pages·2013·1.674 MB·English

by  OECD

Global Forum on Transparency and Exchange of Information GLOBAL FORUM ON TRANSPARENCY AND EXCHANGE
for Tax Purposes
OF INFORMATION FOR TAX PURPOSES
PEER REVIEWS, PHASE 1: NIGERIA
The Global Forum on Transparency and Exchange of Information for Tax Purposes is the
multilateral framework within which work in the area of tax transparency and exchange of
information is carried out by 120 jurisdictions, which participate in the Global Forum on an Peer Review Report
equal footing.
Phase 1
The Global Forum is charged with in-depth monitoring and peer review of the implementation
of the international standards of transparency and exchange of information for tax purposes.
These standards are primarily refl ected in the 2002 OECD Model Agreement on Exchange Legal and Regulatory Framework
of Information on Tax Matters and its commentary, and in Article 26 of the OECD Model
Tax Convention on Income and on Capital and its commentary as updated in 2004. The
standards have also been incorporated into the UN Model Tax Convention.
The standards provide for international exchange on request of foreseeably relevant NIGERIA
information for the administration or enforcement of the domestic tax laws of a requesting
party. Fishing expeditions are not authorised but all foreseeably relevant information must be
provided, including bank information and information held by fi duciaries, regardless of the
existence of a domestic tax interest or the application of a dual criminality standard.
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the exchange of information, while Phase 2 reviews look at the practical implementation of R
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All review reports are published once approved by the Global Forum and they thus represent n
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For more information on the work of the Global Forum on Transparency and Exchange of ula
Information for Tax Purposes, and for copies of the published review reports, please refer to to
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This work is published on the OECD iLibrary, which gathers all OECD books, periodicals and IG
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ISBN 978-92-64-20543-7
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23 2013 40 1 P

Global Forum
on Transparency
and Exchange
of Information for Tax
Purposes Peer Reviews:
Nigeria 2013
PHASE 1:
LEGAL AND REGULATORY FRAMEWORK
November 2013
(reflecting the legal and regulatory framework
as atAugust 2013)
ThisworkispublishedontheresponsibilityoftheSecretary-GeneraloftheOECD.
Theopinionsexpressedandargumentsemployedhereindonotnecessarilyreflect
theofficialviewsoftheOECDorofthegovernmentsofitsmembercountriesor
thoseoftheGlobalForumonTransparencyandExchangeofInformationforTax
Purposes.
Thisdocumentandanymapincludedhereinarewithoutprejudicetothestatusof
orsovereigntyoveranyterritory,tothedelimitationofinternationalfrontiersand
boundariesandtothenameofanyterritory,cityorarea.
Pleasecitethispublicationas:
OECD(2013),GlobalForumonTransparencyandExchangeofInformationforTaxPurposesPeer
Reviews:Nigeria2013:Phase1:LegalandRegulatoryFramework,OECDPublishing.
http://dx.doi.org/10.1787/9789264205444-en
ISBN978-92-64-20543-7(print)
ISBN978-92-64-20544-4(PDF)
Series:GlobalForumonTransparencyandExchangeofInformationforTaxPurposesPeerReviews
ISSN2219-4681(print)
ISSN2219-469X(online)
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TABLE OF CONTENTS – 3
Table of Contents
About the Global Forum                                             5
Executive Summary                                                 7
Introduction                                                        9
Information and methodology used for the peer review of Nigeria            9
Overview of Nigeria                                               10
Compliance with the Standards                                       19
A. Availability of Information                                        19
Overview                                                        19
A1 Ownership and identity information                               20
A2 Accounting records                                            44
A3 Banking information                                           47
B. Access to Information                                            51
Overview                                                        51
B1 Competent Authority’s ability to obtain and provide information        51
B2 Notification requirements and rights and safeguards                  57
C. Exchanging Information                                          59
Overview                                                        59
C1 Exchange of information mechanisms                              60
C2 Exchange of information mechanisms with all relevant partners         67
C3 Confidentiality                                                69
C4 Rights and safeguards of taxpayers and third parties                  73
C5 Timeliness of responses to requests for information                   74
Summary of Determinations and Factors Underlying Recommendations    77
PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – NIGERIA © OECD 2013
4 – TABLE OF CONTENTS
Annex 1: Jurisdiction’s Response to the Report                         81
Annex 2: List of Exchange of Information Mechanisms                   82
Annex 3: List of All Laws, Regulations and Other Relevant Material       87
PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – NIGERIA © OECD 2013
ABOUT THE GLOBAL FORUM – 5
About the Global Forum
The Global Forum on Transparency and Exchange of Information for Tax
Purposes is the multilateral framework within which work in the area of tax
transparency and exchange of information is carried out by over 120 jurisdic-
tions, which participate in the Global Forum on an equal footing
The Global Forum is charged with in-depth monitoring and peer review of
the implementation of the international standards of transparency and exchange
of information for tax purposes These standards are primarily reflected in the
2002 OECD Model Agreement on Exchange of Information on Tax Matters
and its commentary, and in Article 26 of the OECD Model Tax Convention on
Income and on Capital and its commentary as updated in 2004 The standards
have also been incorporated into the UN Model Tax Convention
The standards provide for international exchange on request of foreseeably
relevant information for the administration or enforcement of the domestic tax
laws of a requesting party Fishing expeditions are not authorised but all fore-
seeably relevant information must be provided, including bank information
and information held by fiduciaries, regardless of the existence of a domestic
tax interest
All members of the Global Forum, as well as jurisdictions identified by the
Global Forum as relevant to its work, are being reviewed This process is under-
taken in two phases Phase 1 reviews assess the quality of a jurisdiction’s legal
and regulatory framework for the exchange of information, while Phase 2 reviews
look at the practical implementation of that framework Some Global Forum
members are undergoing combined – Phase 1 and Phase 2 – reviews The Global
Forum has also put in place a process for supplementary reports to follow-up on
recommendations, as well as for the ongoing monitoring of jurisdictions following
the conclusion of a review The ultimate goal is to help jurisdictions to effectively
implement the international standards of transparency and exchange of informa-
tion for tax purposes
All review reports are published once adopted by the Global Forum
For more information on the work of the Global Forum on Transparency and
Exchange of Information for Tax Purposes, and for copies of the published review
reports, please refer to wwwoecdorg/tax/transparency and wwweoi-taxorg
PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – NIGERIA © OECD 2013

ExECUTIVE SUMMARY – 7
Executive Summary
1 This report summarises the legal and regulatory framework for trans-
parency and exchange of information in Nigeria The international standard,
which is set out in the Global Forum’s Terms of Reference to Monitor and
Review Progress Towards Transparency and Exchange of Information, is con-
cerned with the availability of relevant information within a jurisdiction, the
competent authority’s ability to gain timely access to that information, and in
turn, whether that information can be effectively exchanged on a timely basis
with its exchange of information partners
2 Nigeria is located in West Africa, and lies on the Gulf of Guinea and
Atlantic Ocean Nigeria gained its independence from the United Kingdom
on 1 October 1960 Nigeria is the largest economy in its region and second
largest in Africa The Nigerian economy is heavily based on petroleum
3 Nigeria committed to the principles of transparency and exchange
of information in March 2002 and joined the Global Forum in April 2011
Nigeria now has 64 information exchange relationships via 17 Double Tax
Conventions (DTCs) and the recently signed Multilateral Convention on
Mutual Administrative Assistance in Tax Matters Of these, 9 DTCs are in
force Some of Nigeria’s DTCs, signed more than five years ago, are still
not in force Nigeria should take all steps necessary to bring concluded
agreements, including the Multilateral Convention, into effect as quickly as
possible, in consultation with the relevant partners
4 Nigerian law has provisions that generally provide for the availability
of identity and ownership information in respect of companies and trusts
Bearer shares cannot be issued in Nigeria However, information on nomi-
nee ownership is available only with public companies, but not with private
companies
5 The legal framework of Nigeria ensures that companies have to keep
general accounting records and underlying documentation that correctly indi-
cate their correct financial position However, there are currently no express
requirements for partnerships and trusts to retain underlying documentation
PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – NIGERIA © OECD 2013
8 – ExECUTIVE SUMMARY
6 As regards access to information, Nigeria has powers to access infor-
mation and is able to exchange all types of information, including banking
information
7 Nigeria’s response to the recommendations in this report, as well
as the application of the legal framework to the practices of its competent
authority, will be considered in detail in the Phase 2 Peer Review of Nigeria
In the meantime, a follow up report on the steps undertaken by Nigeria to
answer the recommendations made in this report should be provided to the
PRG within one year following the adoption of this report
PEER REVIEW REPORT – PHASE 1: LEGAL AND REGULATORY FRAMEWORK – NIGERIA © OECD 2013