CURRENT DEVELOPMENTS IN THE INCORPORATION OF GUARANTEE COMPANIES UNDER NIGERIAN COMPANY LAW

Abstract

The enactment of CAMA 2020 brought about positive changes to the incorporation process of companies limited by guarantee. The process is mostly the same as in the repealed 1990 CAMA, however, the requirements for procuring the Attorney General’s consent has been modified to allow for a simpler and more efficient incorporation, making it more attractive to not-for-profits and other interested stakeholders, who might previously have been discouraged by the onerous incorporation procedure. Adopting the doctrinal research method, this paper examined the current developments brought about by CAMA 2020 with respect to the incorporation of guarantee companies in Nigeria. The findings show that the erstwhile challenge of delayed consent for incorporation of guarantee companies by the Attorney General of the Federation has been resolved. However, the Act fails to provide any mechanism to challenge the decision of the Attorney General’s refusal to grant consent where all valid documents have been furnished. The alternative applies solely where the Attorney General of the Federation fails to make any decision within the stipulated timeframe. As such, the writers recommend the provision of a mechanism through which aggrieved persons can challenge the decision of the Attorney General of the Federation refusing to grant approval for the incorporation of a guarantee company.