CISLAC: CAMA Will Curtail Illicit Financial Flow


A one-day public consultation/sensitization on the establishment of the Beneficial Ownership Register by the Companies and Allied Matters Act 2020 was recently held in Lagos by the Open Government Partnership (OGP) Nigeria Secretariat in partnership with the Corporate Affairs Commission (CAC). The discourse, supported by Civil Society Legislative Advocacy Centre (CISLAC) and Oxfam in Nigeria, centered on how proper legal framework and effective implementation of the newly signed law will curb illicit financial flows and empower citizens to be part of anti-corruption, writes Sunday Ehigiator

The Company and Allied Matters Act (CAMA) recently signed into law by President Muhammadu Buhari permits the Registrar-General of Corporate Affairs Commission (CAC) and a supervising minister to strictly supervise religious bodies and charity organizations. It also gives the commission power to suspend the trustees of an association or a religious body and appoint an interim manager to coordinate its affairs where there are lapses. It came with its controversies and counter arguments as stakeholders concerned are calling for its review. Against the backdrop, a one-day Public Consultation/Sensitization on the Establishment of the Beneficial Ownership Register by the Companies and Allied Matters Act 2020 was recently held in Lagos. The consultation was attended by representatives of various stakeholder groups including government, Civil Society and the Media.

The meeting was addressed by the Registrar-General of the CAC, Garba Abubakar; the Executive Director of CISLAC, Auwal Ibrahim Musa (Rafsanjani); and the Civil Society Adviser of the OGP Nigeria Secretariat, Stanley Achonu. It was chaired by the immediate past Co-chair of the National Steering Committee of OGP Nigeria, Edetaen Ojo.

In his welcome address, Executive Director of CISLAC, Auwal Ibrahim Musa (Rafsanjani) said the move for CAMA began in 2016 when the Nigerian Government made commitments to strengthen anti-corruption reforms and joined the Open Government Partnership (OGP) in a bid to deepen institutional and policy reforms. One of the commitments within the anti-corruption agenda in the consolidation of existing and new reforms, was the establishment of a Public Central Register of Beneficial Owners of companies.

“Fours years after this bold commitment, we stand before Nigerian public and in the international community to say that we have crossed the first bridge which is having the CAMA amended to support Beneficial Oownership registry establishment”

Speaking further, CISLAC boss noted that while legitimate corporate businesses have an integral role in national development, the involvement of Politically Exposed Persons who conceal corruptly acquired wealth through the complex networks of companies deliberately created to hide their identities has further increased the risks they pose to non-fortified economies. The Siemens, Halliburton and Malabu oil scandals, to cite a few high-profile cases, had a net impact on revenue leakages that was unbearable for the country’s finances and the citizens’ economic well-being.

Calling on all and sundry to embrace the newly signed law, which he believed in the long run helps in stopping illicit financial flow and curtail corruption in the country, Rafsanjani said it is imperative to allow it to take off because as a nation, we had faced some sanctions from the European Union for the inexistence of anti-money laundering legislations; while we see and hear of prosecutions of Individuals and entities involved in the #panamapapers leaks and the #wikileaks among others.

“Without transparent ownership of Nigerian and international companies operating within the Nigerian jurisdiction, we will not be able to stop the bleeding through illicit financial outflows which is perpetually on a geometric increase year on year, which costs us annually around 17 billion US dollars, with special emphasis on the backbone of our economy, the oil and gas industry,” Rafsanjani added.

Ending his remarks, he stressed he believed that a collaborative partnership with the OGP movement and other stakeholders in the campaign will help give a voice to this simple but strategic endeavour that will help curb corruption in our financial, procurement and other strategic sectors.

In his presentation titled “Key changes in provisions relating to the implementation of beneficial ownership in CAMA 2020” the Principal Manager, Compliance Department, Corporate Affairs Commission, Abuja, Olumide Ologe, identified persons with significant in beneficial ownership in CAMA 2020. He noted that adequate provisions are contained in the Companies and Allied Matters Act, 2020 (hereinafter referred to as “the Act”) aimed at identifying the ultimate beneficiaries of shares or interests in Companies and Limited Liability Partnerships.

According to him, these provisions are in form of obligations of disclosure on persons, Companies and Limited Liability Partnerships (LLPs) of information on persons with significant control (directly or indirectly) in the Companies or Limited Liability Partnerships.

“The Act obligates such persons to notify Companies and Limited Liability Partnership of such significant control within seven (7) days of attaining such control. Companies and Limited Liability Partnerships are in turn obligated to notify the Commission of such persons and the particulars of such control.”

Throwing more light on its legal framework, Ologe said Section 868 of the Act defines Person With Significant Control as any person –directly or indirectly holding at least 5% of the shares or interest in a Company or Limited Liability Partnership (LLP); directly or indirectly holding at least 5% of the voting rights in a Company or L(c) directly or indirectly holding the right to appoint or remove majority of the directors or partners in a Company or LLP or having the right to exercise or exercising significant influence or control over the activities of a trust or firm whether or not it is a legal entity but would itself satisfy any of the first four conditions if it were an individual.

On the steps taken by the commission to ensure the implementation of beneficial ownership, Ologe said the Commission has re-designed current forms as well as introducing new forms for disclosure of information on Beneficial Ownership and Persons with Significant Control in Companies and LLPs.

It is also working in collaboration with the World Bank to ensure that a very comprehensive Register of Beneficial Ownership in respect of Companies and LLPs is opened in compliance with the Act.

On the Nigeria’s Commitment on Beneficial Ownership Transparency in the National Action Plan Outline, Civil Society Adviser, Nigeria Open Government Partnership Secretariat, Stanley Achonu said the main objective “is to put in place a system that enables openness, transparency and full disclosure of beneficial ownership information.” While the establishment of a public register of beneficial owners of corporate entities will enable the relevant authorities mandated to curb corruption, identify natural persons who directly or indirectly own, control or enjoy the benefits of the corporate entity.

Rationale for commitment, he emphasized, was to discourage corruption and enable the government to trace and curb illicit financial flows, empowering citizens to be part of anti-corruption.

In a communique jointly signed by the organizers as the end of the discourse, participants recommended that that the CAC should rigorously implement the relevant provisions of the Companies and Allied Matters Act 2020 relating to the establishment of the Beneficial Ownership Register, including adopting appropriate regulations which elaborate the initiative and give full effect to all aspects of it.

Also, CAC and other relevant authorities should ensure that the openness as well as public availability and accessibility of the Register is given legal backing by the adoption of an appropriate legal instrument, which should at a minimum be in the form of Regulations. OGP Secretariat also charged that it should work with relevant actors, including the CAC, to develop an appropriate communication strategy which should facilitate public awareness and enlightenment efforts, including proactively disseminating information to the public about all aspects and stages of the Beneficial Ownership Register initiative.

All the stakeholders concerned were charged to establish mechanisms for keeping the public better informed about the OGP and its activities in Nigeria.