A clear implementation of the CAMA guidelines would be needed to bridge the lack of trust between the FG and the masses, according to Mr. Taiwo Oyedele, Partner and Head, Tax Regulatory Service, PwC Nigeria.
Mr. Oyedele disclosed this at the PwC’s Capability Enhancement Workshop for Journalists on Wednesday afternoon.
He added that, “The new CAMA is the most significant business legislation in Nigeria, which would impact Nigeria’s ease of doing business and also attract investment and economic growth.
“The new Companies and Allied Matters Act 2020 is not an amendment but a reenactment of the older law.”
On the major provisions of the law, he acknowledged that the new CAMA has over 800 sections which is over 200 more than the old one as the government made more measures for administrative roles, including arrangements to rescue a company which gives the government the means to rescue a failing business.
For private businesses, Mr. Oyedele cited the reduction of fees and charges as commendable; the same went for the introduction of limited liability partnerships.
A private company is a company with less than 50 shareholders, under the new CAMA. A private company must have a turnover of less than N120 million and N60 million in net assets, which was N2 million and N1 million respectively in the older regulations. Also, having an AGM is no longer mandatory.
For public companies, he praised the provisions that enable the promotion of futures and derivatives in Nigerian public companies, adding that if Nigeria had a monetary market for futures trading, it would reduce pressure on the FX market.
He also praised the new rule that prohibits the disclosure of owners of the company’s shares as bearer names, which would enable more transparency in the sector.
On the CAC replacing trustees, he said, “The FG is not trying to control the organizations, but regulate to ensure efficiency, since money may be involved in non-profit registered organizations like large churches.
“CAC does not have the power to remove a pastor, but safeguards must be built so that the CAMA provisions are not abused,” he said, adding that “Clear implementations of the guidelines are needed, due to consequences like lack of trust between the FG and the masses.”
Mr. Oyedele opined that the guideline implementations must reach the subnational level to address the issues of over-regulation on smaller business owners on the local government level.
“Nigeria needs to repeal the multiplicity of taxes and levies charged, seeing as 95% of taxes come from 5 major tax sources. Also needed would be capacity and management skills for small business owners, infrastructure to enable a better business environment and more institutional reforms,” he said.
On the next step to be taken, he urged that CAMA should be in line with authentication acts. He added that complementary reforms were needed to harmonize the inconsistent regulations, while also stating that continuous improvement would be needed on the CAMA, considering global best practices and not waiting another 30 years for new reviews.
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Nairametrics reported last month that the Special Adviser to the President on Ease of Doing Business, Dr. Jumoke Oduwole, said that the new Companies and Allied Matters Act 2020, CAMA, would reduce the regulatory burden on businesses in Nigerian and improve ease of doing business in the ecosystem. Dr. Oduwole said the changes in the new CAMA were well received by business leaders.
Some of the new regulations include: new electronic filing of company shares, which was pushed by the SEC; Single shareholder structure for businesses; and SMEs not requiring the services of auditors, virtual meetings and others which would make it easier to do business in Nigeria.