The Companies And Allied Matters Act 2020 - Highlights of the Reforming Provisions and their Implications for Businesses and Investors in Nigeria

Abstract

The signing into law of the Companies and Allied Matters Act (CAMA) 2020 is indeed a vital piece of good news and a ray of hope for many in Nigeria and beyond, especially in the business world. The now-repealed Companies and Allied Matters Act (CAMA) 1990 which had been in operation for thirty years without any substantial improvement despite constant developments in the global corporate practice landscape had over time become outdated. This had inevitably presented obstacles to the seamless incorporation, operation, and the conduct of businesses and investments in the country especially when compared with what is obtainable globally, and thus, deprived the country of the ease of doing business, inflow of investment, and economies of scale that a more modern and more resilient corporate practice regime could have engendered. As a result, the signing into law of the new CAMA has been described as one of the most impactful business/economic upheavals in the country in the past three decades due to its brazen attempt at improving the country’s ease of doing business and achieving global competitiveness in line with the Federal Government’s Economic Recovery and Growth Plan (ERGP 2017 – 2020) which targets Nigeria ranking in the top 70 in the World Bank’s Doing Business Index by 2023. It is believed that the enactment of the Act will reduce regulatory hurdles, ease the business environment, and increase investor confidence in Nigeria as an investment destination. In view of the above, this paper presents an overview of some of the most prominent and relevant provisions of the Act and attempts to clarify their significance/implications for businesses and investors in the country.