CAC Constitutes Administrative Proceedings Committee

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Tuesday, October 19, 2021 / 08:12 AM / by Wole Obayomi / Header Image Credit: Pinterest

 

The Registrar General of the Corporate Affairs Commission ('CAC'), Alhaji Garba Abubakar, announced at a stakeholder's forum on 13 October 2021 that the Administrative Proceedings Committee ('APC') has been fully constituted to fulfill its statutory mandate. The APC was introduced by Section 851 of the Companies and Allied Matters Act, 2020 ('CAMA') as an administrative tribunal for resolution of disputes or grievances arising from the operation of CAMA.

 

Earlier in the year, the CAC had issued the Companies Regulations 2021 ("the Regulations") which provides for the set-up and operation of the APC. Read our Newsletter Issue No. 3.2 of March 2021 for our review of the Regulations.


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We have outlined below, some key highlights of the APC's statutory mandate and modus operandi as set out in the CAMA and the Regulations:

  1. The APC is empowered to adjudicate on non-criminal disputes arising from the operation of CAMA and, in particular, to resolve issues relating to names of companies, limited liability partnership, limited partnerships, business names and incorporated trustees, shares in private companies, and appointment or removal of directors, partners or trustees;
  2. The APC shall comprise the Registrar General of CAC as its Chairman, five (5) directors from CAC's operational departments, and a director from the Federal Ministry of Industry, Trade, and Investment.  The APC shall also designate as its Secretary, a legal officer of the CAC with at least 10 years post-call experience at the Bar;
  3. Complaints on any matter for adjudication by the Committee shall be submitted to the Registrar General of the CAC, who would forward such complaints to the APC for resolution, if he is of the opinion that the provisions of the Act with respect to the matters set out in Regulation 38 have been or are about to be violated.
  4. The Secretary of the APC is to schedule complaints received for hearing within two days of receipt as may be directed by the Chairman of the Committee, and notify the parties of the date of hearing within 5 working days of its receipt. The parties have up to 15 working days of service of the hearing notice to file their briefs and further documents. Based on the prescribed timelines for filing and service of processes by the Secretary and the parties, we estimate that the APC can conclude its adjudication within 40 days of receiving a party's complaint;
  5. Hearings by the APC may be conducted physically at the CAC's Head Office in Abuja, or virtually. The APC is to be guided by the principles of fair hearing, equity and natural justice, rather than the strict rules of evidence; and
  6. The APC's decisions are subject to confirmation by the Board of the CAC, and any party to a complaint at the APC who is dissatisfied with the APC's decision has a right of appeal to the Federal High Court ('FHC').


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Commentary 

The constitution of the APC is a welcome development. The comparative ease of commencement of action at the APC and its expected speedy resolution of disputes should make it attractive for parties to refer their disputes to it for resolution in the first instance before appeal to the FHC.  

 

However, it is noteworthy that while Regulation 38 of the Regulations restricts the disputes for adjudication by the APC to only three matters (namely, issues relating to names of corporate entities and other businesses, shares in private companies, and appointment or removal of principal officers), APC is broadly empowered by Section 851(4)(b) to "resolve disputes or grievances arising from the operations of this Act". The CAC might want to revisit this inconsistency so as not to unduly constrain the APC.

 

Credits

* This statement was first published in the Issue 10.4/ October 2021 Newsletter of KPMG of Monday October 18, 2021. For further enquiries, please contact the author, Wole Obayomi via ng-fmtaxenquiries@ng.kpmg.com


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