companies and allied matters act

377 Pages·2016·3.75 MB·English

by  Sought Out

A BILL

FOR

AN ACT

TO REPEAL

THE

COMPANIES AND ALLIED MATTERS ACT 1990
(CAP C20, LFN 2004)

AND

ENACT

THE

COMPANIES AND ALLIED MATTERS ACT,
2016

TO PROVIDE FOR

THE

INCORPORATION OF COMPANIES, REGISTRATION OF BUSINESS
NAMES TOGETHER WITH INCORPORATION OF TRUSTEES OF
CERTAIN COMMUNITIES, BODIES, ASSOCIATIONS

AND

INCIDENTAL MATTERS

Page 1 of 377
COMPANIES AND ALLIED MATTERS ACT 2016

Commencement [ ]

ARRANGEMENT OF SECTIONS

CORPORATE AFFAIRS COMMISSION
1. Establishment of the Corporate Affairs Commission
2. Governing Board of the Commission
3. Tenure of Office
4. Functions of the Board
5. Remuneration and Allowance
6. Proceedings of the Commission
7. Disclosure of Interest
8. Functions of the Commission
9. Appointment of Registrar-General
10. Appointment of Staff
11. Right to appear in Court
12. Service in the Commission to be Pensionable
13. Fund of the Commission
14. Expenditure of the Commission
15. Annual Accounts, Audit and Estimates
16. Annual Report
17. Pre-action Notice and Restriction on Levy of Execution

INCORPORATION OF COMPANIES AND INCIDENTAL MATTERS

CHAPTER 1

FORMATION OF COMPANY
18. Right to Form a Company
19. Partnership, etc., of More Than Twenty Members when Permitted
20. Capacity of Individual to Form Company
21. Types of Companies
22. Private Company
23. Consequences of Default in Complying with Conditions Constituting A Private
Company
24. Public Company
25. Unlimited Company to Have Share Capital
26. Company Limited by Guarantee

MEMORANDUM OF ASSOCIATION
27. Requirements With Respect to the Memorandum of A Company.
28. Form of Memorandum

NAME OF COMPANY
Page 2 of 377
29. Name as Stated in the Memorandum
30. Change of Name of Company
31. Reservation of Name

ARTICLES OF ASSOCIATION
32. Articles for Regulating Companies
33. Form and Contents of Articles

REGISTRATION OF COMPANIES
34. Documents of incorporation
35. Registration
36. Effect of Registration

CAPACITY AND POWERS OF COMPANIES
37. Powers of Companies
38. Effect of Ultra Vires Acts
39. Effect of Reliance on Restrictions in the Memorandum

EFFECT OF MEMORANDUM AND ARTICLES
40. Effect of Memorandum and Articles

MEMBER’S RIGHT TO COPY OF MEMORANDUM AND ARTICLES
41. Member’s right to Copies of Memorandum, etc
42. Copies of Memorandum Issued to Embody Alterations

ALTERATION OF MEMORANDUM AND ARTICLES
43. Restriction on Alteration of Memorandum
44. Alteration of Memorandum
45. Mode of Alteration of Business or Objects
46. Power to Alter Provisions in the Memorandum in Certain Cases
47. Alteration of Articles
48. Limitation of Liability to Contribute to Share Capital if Memorandum, etc., Altered

CHAPTER 2

CONVERSION AND RE-REGISTRATION OF COMPANIES
49. Re-registration of Private Company as Public
50. Re-registration of Company Limited by Shares as Unlimited
51. Re-registration of Unlimited as Limited by Shares
52. Re-registration of Public Company as Private

CHAPTER 3

FOREIGN COMPANIES
53. Foreign Companies Intending to Carry on Business in Nigeria
54. Penalties
55. Power to Exempt Foreign Companies
56. Annual Report
57. Exempted Foreign Company to Have Status of Unregistered Company
58. Penalties for False Information
Page 3 of 377
59. Application of Certain Sections to Foreign Companies

CHAPTER 4

PROMOTERS
60. Persons Promoting a Company
61. Duties and Liabilities of a Promoter

PART III

ACTS BY OR ON BEHALF OF THE COMPANY EXERCISE OF COMPANY’S POWERS
62. Division of Powers between General Meeting and Board of Directors
63. Delegation to Committees and Managing Directors

LIABILITY FOR ACTS OF THE COMPANY
64. Acts of General Meeting, Board of Directors, or of Managing Directors
65. Acts of Officers or Agents
66. When Provision Exempting, etc., Officer from Liability to the Company is Void

CONSTRUCTIVE NOTICE OF REGISTERED DOCUMENTS
67. Abolition of Constructive Notice of Registered Documents
68. Presumptions of Regularity
69. Liability of Company not Affected by Fraud or Forgery of Officer

COMPANY’S CONTRACTS
70. Form of Contract
71. Pre-incorporation Contracts
72. Bills of Exchange and Promissory Note
73. Common Seal of the Company
74. Official Seal for Use Abroad
75. Powers of Attorney

AUTHENTICATION AND SERVICE OF DOCUMENTS
76. Authentication of Documents
77. Service of Documents on Companies

PART IV

MEMBERSHIP OF COMPANY
78. Definition of Member
79. Capacity to be a Member
80. Right of Member to Attend Meetings and Vote
81. Personation of Members

REGISTER OF MEMBERS
82. Register of Members
83. Location of Register
84. Index of Members to be Kept
85. Inspection of Register and Index
86. Consequences of Failure by Agent’s Default to Keep Register
Page 4 of 377
87. Power to Close Register
88. Power of Court to Rectify Register
89. Register to be Evidence

LIABILITY OF MEMBERS
90. Liability of Members
91. Liability for Company Debts Where Membership is Below Legal Minimum

DISCLOSURE OF BENEFICIAL INTEREST IN SHARES
92. Disclosure of Capacity of Shareholder
93. Obligation of Disclosure by Substantial Shareholder in Public Company
94. Person Ceasing to be A Substantial Shareholder to Notify Company
95. Register of Interest in Shares
96. Registration of Interest to be Disclosed

PART V

SHARE CAPITAL

MINIMUM SHARE CAPITAL
97. Authorised Minimum Share Capital

ALTERATION OF SHARE CAPITAL
98. Alteration of Share Capital by Consolidation, etc.
99. Notice Required Where Shares and Stock Consolidated, etc.
100. Increase of Share Capital and Notice of Increase
101. Increase of Issued Capital on Increase of Shares
102. Power of Unlimited Company to Provide Reserve Share Capital on Re-registration

REDUCTION OF SHARE CAPITAL
103. Restriction on Reduction of Share Capital
104. Special Resolution for Reduction of Share Capita
105. Application to Court for Order of Confirmation
106. Court Order Confirming Reduction
107. Registration of Order and Minutes of Reduction
108. Liability of Members on Reduced Shares
109. Penalty for Concealing Name of Creditor, etc.

MISCELLANEOUS MATTERS RELATING TO CAPITAL
110. Duty of Directors on Serious Loss of Capital
111. Power to Pay Interest Out of Capital in Certain Cases

PART VI

SHARES

NATURE OF SHARES
112. Rights and Liabilities Attached to Shares
113. Shares as Transferable Property
114. Prohibition of Non-voting and Weighted Shares
Page 5 of 377
ISSUE OF SHARES
115. Power of Companies to Issue Shares
116. Issue of Classes of Shares
117. Issue with Rights Attached
118. Issue of Shares at a Premium
119. Issue of Shares at a Discount
120. Issue of Redeemable Preference Shares
121. Validation of Improperly Issued Shares

ALLOTMENT OF SHARES
122. Authority to Allot Shares
123. Method of Application and Allotment
124. Allotment as Acceptance of Contract
125. Payment on Allotment
126. Effect of Irregular Allotment
127. Return as to Allotment

COMMISSIONS AND DISCOUNTS
128. Prohibition on Payment of Commissions, Discounts Out of Shares and Capital
129. Power to Pay Commission in Certain Cases
130. Statement in Balance Sheet as to Commission

CALL ON AND PAYMENT FOR SHARES
131. Call on Shares
132. Reserve Liability of Company Having Share Capital
133. Payment for Shares
134. Meaning of Payment in Cash
135. Payment other than Cash
136. Power to Pay Different Amount on Shares

LIEN AND FORFEITURE OF SHARES
137. Lien on Shares
138. Forfeiture of Shares

CLASSES OF SHARES
139. Power to Vary Rights
140. Application for Cancellation of Variation
141. Right of Preference Share to More than One Vote
142. Construction of Class Rights

NUMBERING OF SHARES
143. Shares to be Numbered

SHARE CERTIFICATES
144. Issue of Share Certificates
145. Effect of Share Certificates
146. Probate, etc., as Evidence of Grant

CONVERSION OF SHARES INTO STOCK
Page 6 of 377
147. Conversion of Shares into Stock

TRANSFER AND TRANSMISSION
148. Transfer of Shares
149. Entry in Register of Transfers
150. Notice of Refusal
151. Transfer by Personal Representative
152. Transmission of Shares
153. Protection of Beneficiaries
154. Certification of Transfers

TRANSACTIONS BY COMPANY IN RESPECT OF ITS OWN SHARES
155. Redemption of Redeemable Preference Shares
156. Prohibition of Financial Assistance by Company for Acquisition of its Shares
157. Acquisition by a Company of its Own Shares
158. Conditions for Purchase by a Company of its Own Shares
159. Limit on Number of Shares Acquired
160. Enforceability of Contract to Acquire Shares
161. Re-issue of Shares Acquired
162. Acquisition of Shares of Holding Company

PART VII

DEBENTURES

CREATION OF DEBENTURE AND DEBENTURE STOCK
163. Power to Borrow Money, to Charge Property and to Issue Debentures
164. Documents to Title of Debentures or Certificate of Debenture Stock
165. Statements to be Included in Debentures
166. Effects of Statements in Debentures
167. Enforcement of Contracts Relating to Debentures

TYPES OF DEBENTURES
168. Perpetual Debentures
169. Convertible Debentures
170. Secured or Naked Debentures
171. Redeemable Debentures
172. Power to Re-issue Redeemed Debentures in Certain Cases
173. Rights of Debenture Holders
174. Meetings of Debenture Holders

FIXED AND FLOATING CHARGES
175. Meaning of “Floating” and “Fixed” Charges
176. Priority of Fixed over Floating Charge
177. Powers of the Court
178. Advertisement of Appointment of Receiver and Manager
179. Preferential Payment to Debenture Holders in Certain Cases

DEBENTURE TRUST DEED
180. Execution of Debenture Trust Deed
Page 7 of 377
181. Contents of Debenture Trust Deed
182. Contents of Debenture Covered by Trust Deed
183. Trustees for Debenture Holders
184. Disqualification for Appointment as Trustee of Debenture Trust Deed
185. Liability of Trustees for Debenture Holders
186. Restrictions on Transferability of Debentures

PROVISIONS AS TO COMPANY’S REGISTER OF CHARGES, DEBENTURE
HOLDERS AND AS TO COPIES OF INSTRUMENTS CREATING CHARGES
187. Company to Keep Copies of Instruments Creating Charge
188. Company’s Register of Charges
189. Inspection of Register and Copies of Instrument
190. Register of Debenture Holders
191. Inspection of Register of Debentures, etc.
192. Entry in Register of Transfer
193. Notice of Refusal to Register

REGISTRATION OF CHARGES WITH COMMISSION
194. Registration of Charges Created by Companies
195. Register of Particular of Charges
196. Duty of Company to Register Charges
197. Duty of Company Acquiring Property to Register Subsisting Charges
198. Existing Charges
198. Charges to Secure Fluctuating Amounts
200. Endorsement of Certificate of Registration on Debentures
201. Entries of Satisfaction of Charges
202. Rectification of Register
203. Registration of Appointment Order, etc.
204. Inspection of Register and Copies of Instruments

REALISATION OF SECURITY
205. Realisation of Debenture Holder’s Security
206. Remedies Available to Debenture Holders
207. Application of Certain Sections

PART VIII

MEETINGS AND PROCEEDINGS OF COMPANIES

STATUTORY MEETING
208. Statutory Meeting
209. Non-compliance and Penalty

GENERAL MEETING
210. Annual General Meeting
211. Business Transacted at Annual General Meeting

EXTRAORDINARY GENERAL MEETING
212. Extraordinary General Meeting
213. Place of Meeting
Page 8 of 377
NOTICE OF MEETINGS
214. Length of Notice for Calling Meetings
215. Contents of Notice
216. Persons Entitled to Notice
217. Service of Notice
218. Failure to Give Notice
219. Additional Notice
220. Power of Court to Order Meetings

VOTING
221. Procedure of Voting
222. Right to Demand Poll
223. Voting on Poll
224. Right of Attendance at General Meeting
225. Attendance at Meetings
226. Objections as to Qualification to Vote
227. Proxies
228. Corporation Representation at Meetings of Companies, etc.
229. Quorum

RESOLUTIONS
230. Resolutions
231. Written Resolutions
232. Circulation of Members’ Resolutions
233. Resolutions Requiring Special Notice
234. Registration and Copies of Certain Resolutions
235. Effect of Resolutions Passed at Adjourned Meetings

MISCELLANEOUS MATTERS RELATING TO MEETINGS AND PROCEEDINGS
236. Adjournment
237. Powers and Duties of the Chairman of the General Meeting
238. Minutes of Proceedings and Effect
239. Inspection of Minute Books and Copies
240. Class Meetings

PART IX

DIRECTORS AND SECRETARIES OF THE COMPANY

CHAPTER 1

DIRECTORS

MEANING OF DIRECTORS
241. Meaning of “Directors”
242. Shadow Director

APPOINTMENT OF DIRECTORS
243. Number of Directors
Page 9 of 377
244. Appointment of Directors
245. Subsequent Appointment of Directors
246. Casual Vacancy
247. Liability of Person where not Duly Appointed
248. Share Qualification of Directors
249. Duty of Directors to Disclose Age and Multiple Directorship to the Company
250. Provisions as to Insolvent Persons Acting as Directors
251. Restraint of Fraudulent Persons
252. Prohibition of Persons Convicted of Fraudulent Offences from being Directors of
Public Company
253. Appointment of Director for Life
254. Right to Appoint a Director at Any Age
255. Disqualification for Directorship
256. Vacation of Office of Director
257. Rotation of Directors
258. Validity of Acts of Directors
259. Mode of Voting on Appointment of Directors

REMOVAL OF DIRECTORS
260. Removal of Directors

PROCEEDINGS OF DIRECTORS
261. Proceedings of Directors
262. Quorum
263. Failure to Have a Quorum
264. Notice of Meeting

REMUNERATION AND OTHER PAYMENTS
265. Remuneration of Directors
266. Remuneration of a Managing Director
267. Prohibition of Tax-free Payments to Directors
268. Prohibition of Loans to Directors in Certain Circumstances
269. Payment by Company for Loss of Office, etc., to be Approved
270. Payment to Director for Loss of Office, etc., Transfer of Property Illegal
271. Director to Disclose Payment for Loss of Office, etc., in Certain Cases
272. Provisions Supplementary to Sections 269 to 271

DISCLOSURE OF DIRECTORS’ INTERESTS
273. Register of Directors’ Shareholding
274. General Duty to Give Notice, etc.
275. Disclosure by Directors of Interest in Contracts
276. Particulars with Respect to Directors in Trade Catalogues

DUTIES OF DIRECTORS
277. Duties of Directors
278. Conflicts of Duties and Interests
279. Multiple Directorships
280. Duty of Care and Skill
281. Legal Position of Directors

Page 10 of 377