Nigeria introduced the largest corporate governance legislation overhaul in 30 years
14 October 2020 - On 7 August, the President of Nigeria 2020 signed into law the Companies and Allied Matters Act, 2020 (“CAMA 2020”) to replace the 1990 Act. This is the biggest overhaul of corporate governance legislation in 30 years.
CAMA 2020 is the primary legislation governing incorporation and management of companies in Nigeria, which it is intended to streamline. The act also enhances transparency and reduces the regulatory burden for small and medium enterprises (SMEs).
Some of the key changes are:
- Businesses are no longer required to have a minimum of two shareholders;
- E-signatures, e-register for share transfers and virtual general meetings for private companies are now allowed;
- New business structures, namely Limited Liability Partnerships (LLP) and Limited Partnerships (LP) have been introduced;
- Chief Executive Officer and the Chairman of the Board of a company can no longer be the same person;
- New Companies Limited by Guarantee are required to obtain consent from the Attorney General before incorporation. The new legislation states that if the Attorney General does not make a decision within 30 days, the incorporation can go ahead without the consent.