COMPANY LAW 1.2 REGULATORY BODIES
This topic briefly focuses on the CAC and SEC
THE CORPORATE AFFAIRS COMMISSION (CAC)
Section 1 of the CAMA establishes it as a body corporate with perpetual succession and common seal can sue and be sued, hold and dispose properties and perform its functions independently. HQ at the FCT with branches in each State.
Composition/Membership of the CAC Section 2 CAMA. 10 members which comprise of the :: Chairman, :: Representative of: -the Business community, -The Legal Profession, -Accountancy Profession, -Ministry of Commerce, -Ministry of Justice, -Ministry of Industry, -SEC and -Manufacturers’ Association of Nigeria, :: Then a registrar general with not less than 10 years post call experience.
Their composition ensures competence and knowledge in handling the affairs of the commission. The members are public servants and must act in the interest of the public. The rules of equity may apply.
Tenure of Office: Section 3- serve for 3 years and can be reappointed for another three and no more-Section 3(1).
- By the minister subject to approval of the President. If the person’s membership is detrimental to the CAC-Section 3(2).
- Where the member becomes insane, bankrupt, is convicted of a felony (or any offence involving dishonesty), guilty of serious misconduct or personally disqualified from practicing his profession by his professional body.
Remuneration: to be determined by the president-Section 4.
Quorum: 5 member. The chairman being part-Section 5:
Disclosure of interest: Provides that a person directly interested in a co which the CAC is deliberating upon must disclose such interest and relevant facts within his knowledge. The CAC then records such disclosure and the affected member should not participate in the proceeding/deliberation- Section 6
Functions: Section 7.
- Administer the Act: regulation, incorporation, supervision, management, winding up and so on. They can institute proceedings where necessary-Section 303
- Establish and maintain a Companies Registry and office in all states to be maintained according to the Registrar General’s direction.
- Supervise and scrutinise the affairs of companies.
- Carry out other functions specified in the Act and those necessary to implement the CAMA.
THE SECURITIES AND EXCHANGE COMMISSION. SEC
The apex regulatory body for the Nigerian Capital Market to ensure a fair, efficient and transparent capital market-See the Preamble to the ISA (Investment Securities Act 2007).
Established under Section 1 of the ISA. Just like the CAC, it is a body corporate… with a Head Office in Abuja and Zonal Offices in various States-Section 2 ISA.
Composition–Section 3 ISA: 9-Member Board. Consisting of; -Chairman, -Director General and Chief Executive (as accounting officer), -three full time Commissioners, -a rep of the Fed Min of Finance, -A rep of CBN and two part-time Commissioners.
Members should be fit and proper. They subscribe to (and are bound by) the codes of ethics.
Their function is summarised as “administering the SEC”, Regulating Capital Security business in Nigeria and protecting investors-See Section 13. Other incidental to. E.g. In Owena Bank V Nigerian Stock Exchange the court held that they can even suspend the registration of any person’s security for up to 12 months (and no more).
Appointment and tenure: Section 5.
The DG and Full-time Commissioners are appointed by the president on the recommendation of the minister and subject to confirmation by the senate. Chairman and other ex-cofficial members go for 4 years and no more-Section 5(5).
Disqualification: Section 8. Same as that of the CAC highlighted earlier.
THE (NSE) NIGERIAN STOCK EXCHANGE.
A Self-regulatory corporate body initially established as the Lagos Stock Exchange under the Lagos Stock Exchange Act 1961 which is now the Investment and Securities Act 2007.
Has its head office in Lagos.
Composition: -A President and -two VPs, -A CEO, -Chairman, -one ex-officio member, -nine national members, -one institutional member and -eight dealing members.
Functions: Summarised; to ensure discipline and justice in the administration of security exchange. In doing this, it can call for information from, inspect and conduct inquires and audit of its members-Section 32 ISA.
:: PRINCIPAL LAWS, SUBSIDIARY LEGISLATIONS AND REGULATORY BODIES ON CORPORATE LAW PRACTICE.
:: FEATURES AND FUNCTIONS OF THE REGULATORY BODIES.
|S/N||LAW||REGULATORY BODY||EST SECTION||FUNCTIONS|
|1.||Companies and Allied Matters Act 1990.||Corporate Affairs Commission.||S 1 CAMA.||S 7 CAMA. To implement the CAMA which includes; Register, supervise and Investigate Companies and other forms of businesses.|
|2.||Investments and Securities Act 2007||Securities and Exchange Commission.||S 1 ISA.||S 13 ISA-SEC Regulates the Nigerian Capital Market, its stakeholders/players and Transactions conducted therein to ensure development and transparency.|
|3.||Nigerian Investment Promotion Commission Act 1995?||Nigerian Investment Promotion Commission||S 1 NIPCA||Promote Foreign Investment in Nigeria and grant fiscal concessions therewith. Note its Establishment of OSIC.|
|4.||Foreign Exchange (Monitoring and Miscellaneous Provisions) Act.||CBN, Minister of Finance.||S 1 FE(MMP)A.|
|5.||National Office for Technology Acquisition and Promotion Act||National Office for Technology Acquisition and Promotion.||S 1 NOTAPA.||To invigilate the transfer of foreign technology to Nigeria.|
|6.||Industrial Inspectorate Act 2007||Industrial Inspectorate Division (Federal Ministry of Industry).||S 1 IIA 2007.|
|8.||Companies Income Tax (Amendment) Act 2007.||Federal Inland Revenue Service (FIRS)||S 1 FIRSEA||Generally administers Federal Taxes one of which is Companies Income Tax.|
|9.||Asset Management Corporation of Nigeria Act 2010.||Asset Management Corporation of Nigeria.||S 1 AMCONA||Resolve liquidity problems in the financial sector and disposal of bank assets.|
|10.||Federal High Court Act||Federal High Court.||S 1 FHCA, S 249 1999 Constitution.||Jurisdiction on Corporate Matters-Section 251, 1999 Constitution.|
|11.||Banks and Other Financial Institutions Act||Central Bank of Nigeria (CBN)||S 1 CBNA||Apex Regulator of Financial Institutions in Nigeria.|
|12.||NSE||Provides trading floor for sale and purchase of securities.|
|13.||National Council of Privatization||Determine policy on privatization and commercialisation which BPE implements.|
|14.||Nigerian Communications Commission Act||NCC|
|17.||Nigerian Copyright Commission.|
 There are a host of others which regulate specific sectors.
 Appointed by the president on recommendation of the Minister. Must be knowledgeable and specialized.
 Each of the representatives are appointed by the minister on the recommendation of the respective bodies that regulate the profession of the person representing.
 Not below the grade of director or its equivalent.
 Or any other member can be elected by the members to represent the chairman in his absence.
 Assistant registrar generals run the affairs in other states.
 In deserving circumstances (listed in the act like fraud, deceit, misconduct, etc.) in the interest of the shareholders and public. Investigators can be appointed by the CAC to do this-Section 314 and 315 CAMA
 In this light, the CAC makes rules and regulations to guide. Subject to the approval of the president.
 This is one person.
 One of whom must be a legal proactitioner with 10 years post call experience.
 DG has 5 years and can be appointed for another one term (5 years) and no more. He is responsible for the management of the SEC.
 Serve for 4 years and can be reappointed only one more time.
 Can sue and be sued, etc…
 You can add two functions. 1. To administer the act and 2. Advise the Public.
 Metamorphosed from Capital Issues Committee 1962-to SEC in 1978. Encapsulated in the promulgation of SEC Decree 1979-1999-2007.
 Market Operators, Special Savings Schemes, etc.
 Like Securities Exchanges, Mergers, Acquisitions and so on.
 The NIPC Act repealed the Industrial Development Coordinate Committee Act and Nigerian Enterprises Promotion Decree.