In this piece, TOPE SUNDAY takes a look at the controversies generated by the Companies and Allied Matters Act (CAMA), 2020.
On August 7, 2020, President Muhammadu Buhari signed into law the Companies and Allied Matters Act (CAMA), 2020. Soon after, controversies greeted it and various stakeholders in the civil society organisations (CSOs) and church businesses are kicking, even as some Nigerians have thumbed up the government of the day.
The ‘silent’ part of CAMA
Despite the criticisms that have greeted CAMA 2020, some Nigerians are of the opinion that it is expected to enhance the ease of doing business.
According to a veteran journalist, Abiola Odutola, the new document has repealed and replaced the extant CAMA 1990 with key amendments that would remove some bottlenecks from the old act. He said the revised Act will make Nigeria’s business environment as competitive as its counterparts around the world.
Odutola in his article published on Nairametrics said: “Provision of single-member/shareholder companies- Section 18 (2) of the new CAMA now makes it possible to establish a private company with only one member or shareholders. Appointment of Company Secretary now optional- Going forward, the appointment of company secretary for private company is optional. According to Section 330 (1) of the new CAMA, the appointment is only mandatory for public companies.
“A director can’t hold the office of a Chairman, CEO – According to Section 265 (6), private firms are now restricted from appointing a director to hold the office of the Chairman and Chief Executive Officer.
“Procurement of Common seal not mandatory – Contrary to the previous document that insisted that every company must procure a Common Seal, CAMA 2020, according to Section 98, states that most jurisdictions around the world have expunged the requirement from their laws. This also enhances tax revenue for the government.”
The ‘controversial’ part
Among the various provisions of the CAMA), 2020, Section 839 (1), which dwells on the suspension of trustees and appointment of interim manager(s), appears most contentious.
Section 839 (1) of CAMA 2020 empowers the Corporate Affairs Commission (CAC) to suspend trustees of an association and appoint interim managers to manage the affairs of the association where it reasonably believes that-
(a) There is or has been misconduct or mismanagement in the administration of the association; (b) it is necessary or desirable for the purpose of; I. Protecting the property of the association; ii. Securing a proper application for the property of the association towards achieving the objects of the association, the purpose of the association of that property or of the property coming to the association,
iii. Public interest; or (c) the affairs of the association are being run fraudulently.
Church leaders’ take
After notable church leaders like Bishop David Oyedepo of the Living Faith Church had raised their voices against the Act, the Christian Association of Nigeria (CAN) officially rejected the Act. It specifically said the law contains a provision which silently declared war against the Church of God in Nigeria, calling it ‘satanic.’
The CAN president, Rev. Samson Ayokunle, in a statement released by his special assistant on media and communications, Adebayo Oladeji, said: “The leadership of the Christian Association of Nigeria rejects outright the Companies and Allied Matters Act, 2020 that was assented to by President Muhammadu Buhari recently.
“The law, to say the least, is unacceptable, ungodly, reprehensible, and an ill-wind that blows no one any good. It is a time bomb waiting to explode.
“While we are not against the government fighting corruption wherever it may be found, yet we completely reject the idea of bringing the church, which is technically grouped among the NGOs, under the control of government. The Church cannot be controlled by the government because of its spiritual responsibilities and obligations.
“How can the government sack the trustee of a church which it contributed no dime to establish? How can a secular and political minister be the final authority on the affairs and management of another institution which is not political?
“How can a non-Christian head of government ministry be the one to determine the running of the church? It is an invitation to trouble that the government does not have power to manage.”
Like CAN, Socio-Economic Rights and Accountability Project (SERAP), a civil society organisation (CSO), which appears to be the mouth-piece of other CSOs, asked President Buhari to rescind his assent to CAMA 2020 and send the legislation back to the National Assembly to address its fundamental flaws, by deleting the ‘repressive’ provisions of the Act, particularly sections 839, 842, 843, 844 and 850.
SERAP in a series of tweets on its official twitter handles@SERAPNigeria on August 23, 2020, said: “We also asked him to instruct the Registrar-General of the CAC, Alhaji Garba Abubakar & AGF Abubakar Malami, SAN, not to implement or enforce the CAMA 2020 until the legislation is repealed by the National Assembly and brought in line with the constitution and international standards.
“With these provisions, the government now has overly broad and discretionary powers to arbitrarily withdraw or revoke the certificate of any association, suspend and remove trustees and to merge two associations without their consent and approval.
“Rather than taking concrete measures to improve the legal environment and civic space that would ensure respect for human rights and media freedom, your government has consistently pursued initiatives to restrict the enjoyment of citizens’ human rights.
“These restrictions, coupled with repressive broadcasting codes and Nigerian security agencies’ relentless crackdown on peaceful protesters and civil society, demonstrate the government’s intention to suppress and take over independent associations.”
Other voices
A Lagos-based lawyer, Orji Uka, disagreed with the assertion that Section 839 of CAMA, 2020 means that “the CAC may remove and replace the trustees of a CSO if it determines that it is in “the public interest” to do so.’’
Uka in an article was published by Nairametrics, said: “Once again for the record, a community reading of the said Section 839 of CAMA shows that an order of court is required to suspend the trustees of an NGO under that section. Additionally, the extant principles of Nigerian administrative law are adequate to ensure that the wrongful exercise of the regulatory powers of the CAC is brought under the supervisory control of the courts.
“A proper reading of the CAMA in its entirety will reveal that the CAC also has supervisory powers over other types of entities like companies, partnerships, and business names. Is the argument that NGOs (e.g. churches) are above any form of supervision? If so let us say so.
“In the final analysis, I also do not think there is merit to the allegation that the CAMA 2020 is the NGO Bill in disguise.’’
Also, a public policy analyst, Odu Obodumu, said all chief executives of CSOs and churches must be accountable, adding that the law has come to stay. Obodumu, who tweeted via @OduObodumu, said: “Nooo, the law must stay. You must be held accountable for the grants you collect from everywhere and convert to personal use. The era of collecting grants and no account must end.”
Also, another Twitter user, Tunde Ismail, collaborated Obodumu’s position, saying all the affected entities must give account of money collected from various donors.
Ismail, who tweeted via@Tunde_Ismail, said: “If SERAP feels they can muzzle the President like they did in the case of GEJ regarding FRCN, then they must be dreaming. Let them dare the president by violating any provisions of the law. They should continue urging while the law has come to stay. Be accountable!!!!!’’
However, another Twitter user, Angel of Justice@kenndola, questioned the rationale behind the quick passage of CAMA 2020 and President Buhari’s assent to it.
“Some folks here shouting be accountable ,is the govt accountable? Why the urgency in passing this law if it isn’t for sinister motive, when the electoral law has been rejected several times by the same president for frivolous reasons. Good riddance to bad rubbish’’, she said.
For another Twitter user, Henry Chuks Uzor, CAMA 2020 is needless considering many crises that the country is battling with.
Uzor, who expressed his opinion on his twitter handle @uzorhenry, said: “Nigerians will not eat laws, they need food, job, infrastructure, health care, security, (and) education if these basics are there, citizens will talk and worry less. Today, people have resulted to the old trade just to earn a living. The earliest our political leaders look inwards, the better.”
