BRIPAN Advocates Early Deployment of Insolvency Tools Amid Evolving Financial Landscape

Oluchi Chibuzor

The Business Recovery and Insolvency Practitioners Association of Nigeria (BRIPAN) has called for early deployment of insolvency tools by businesses in the country amid the evolving financial landscape.

Speaking recently at an event in Lagos, President BRIPAN, Chimezie Victor Ihekweazu (SAN), stressed that early engagement is crucial for effective business recovery.

He affirmed that BRIPAN boasts of well-trained professionals who have been tested in several insolvency processes, matters that cut across different jurisdictions and are competent to support business recovery and enable failing businesses and challenged businesses to come back to life.

According to him, preventing business failure has a significant multiplier effect on secondary obligations, families, professional engagements and even the entire economy.

“The truth about it is that insurgency sets in at least a period of two, a year or two, preceding the actual state of insurgency. So, within those periods, once the indications begin to show it is important that insurgency practitioners are engaged to support those businesses with the knowledge so that those businesses can be rescued and that effective business recovery can be achieved within the scope of the law and practice in Nigeria.

“And you know, under the new Companies and Allied Matters Act 2020, a number of options like administration, companies’ voluntary arrangements and even netting have been introduced.

“And even receivership and liquidations have also been reinforced with more effective and very suitable provisions that will support business recovery in Nigeria.

“So, I strongly believe, and with our experiences in some life cases, we believe that the challenges that are being faced by businesses can be surmounted, and can be resolved through a judicial or administrative process which is supported by law to enhance effective business recovery in Nigeria.”

Ihekweazu highlighted key signs that businesses must know for them to request services of insolvency practitioners.

According to him, “There are a number of signs, particularly with regards to delayed payment of salaries, delayed fulfillment of obligations and a number of performance challenges in terms of contractual obligations. These are some of the challenges that you can talk of and once this begins to set in, and sometimes also managing overhead in business.

“And again, you know, changes in policies and laws can result in insolvency for some businesses. So, once you begin to see or notice this, it’s important that effective business recovery experts are engaged to support such businesses so that they can achieve a complete rescue.”

He advocated the need to engage professionals at the right time to prevent business failure which could have an impact on the entire economy.

“You don’t have to get an insolvency practitioner or business-related professionals to come in at a point when the business has failed. There are indications. Once you begin to notice these indications, it’s important for you to engage a business recovery expert or an insolvency practitioner who is well knowledgeable and informed in business rescue and recovery to be able to support the businesses and be engaged to give assistance to those businesses.

“And I believe this will help our economy because with one failed business, the multiplier effect of it in terms of the secondary obligations owed, family, professional engagement, can be huge,” Ihekweazu said.