Are you interested in learning about the companies and allied matters act in Nigeria? You’ve come to the right place. In this article, you will learn the basic things you need to know about the business law.
A Brief History Of The Act
The Nigerian Companies and Allied Matters Act (CAMA) first came to be in 1990 as a decree by the military government.
It provides for the incorporation of companies, limited liability partnerships, limited partnerships, registration of business names together with the incorporation of trustees of certain communities, bodies, associations, and other business related matters.
It was officially signed into law and has since then remained untouched and unrevised. This means that for 30 years, there was no reformation to the law leaving the policies therein as extinct to a large extent. This seems funny considering that this law was modelled according to the “English Company Act” in 1985 which has since been revised multiple times.
However, on the 7th of August 2020, the Executive President of the Federal Republic of Nigeria, Gen. Muhammadu Buhari signed the new and revised Companies and Allied Matters Act(CAMA), giving us CAMA2020 which repeals and replaces the Companies and Allied Matters Act, 1990 .
This is a welcome development as companies have had to rely on an act that is 30 years old for the last few decades.
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CAMA2020: What Should Know About It As A Business Owner In Nigeria
CAMA 2020 provides a detailed and well researched framework for changing and correcting identified out of date legal, regulatory and administrative bottlenecks which, have for the last30years, since 1990 made doing business in Nigeria very difficult, especially for Micro, Small and Medium Enterprises (MSMEs), and chased investors away from the country.
This new Companies and Allied Matter Act (“CAMA 2020” or “the Act”) brings in clauses and provisions to reflect the modern day commercial realities as well as reduce compliance costs and regulatory hurdles for businesses in Nigeria.
CAMA 2020 brings in a lot of changes and new provisions that ensure that running a business is easier, more attractive and much more lucrative.
The signing of this Companies and Allied Matters Bill into law is a welcome development as it is expected to improve the ease of registration, commencement and operation of businesses in Nigeria by providing simpler processes and lessening regulatory compliance burden.
One of the biggest advantages of this new law is that it allows for and encourages the inflow of International collaborations and Investments from companies outside of Nigeria.
The ease of registration also makes it much easier for the average Nigerian to own and operate a registered business.
This could reduce the emigration levels and lead to less Brain Drain as great Nigerian minds can put their skills, talents, and technical know how can decide to set up companies without fear of the hurdles brought about by registration, commencement and operation of businesses in Nigeria.
There is expected to be a rise in the number of Micro, Small and Medium Enterprises (MSMEs) in the various states in the Country. We could very well be moving into the next step in the Industrialization and development of our Nation.
On the long run, our economy is expected to see a massive in increase, leading to higher Gross Domestic Products (GDP) per year. It also places us out of the reach of recession as production will definitely be on the increase.
The introduction of CAMA2020 is a most welcome development for us in Nigeria and we expect to see much forward movement in the days to come. If you’ve been wondering about the Company and Allied Matters Act, you should find this very helpful.