As part of the process to improve the Nigerian tax environment and promote fiscal equity and uniformity in line with global best practices, the Finance Bill 2019 (“the Bill”) was presented to the National Assembly by President Muhammadu Buhari GCFR on 08 October 2019 and was passed by the House of Representative on 28 November 2019.
The Bill is intended to cure incidence of multiple taxation that exist under our tax framework. It seeks to do this by amending sections of our various Tax Laws to bring about uniformity and create an enabling environment to actualize the ease of doing business initiative of the Federal Government.
Efficiency and integrity of the legal process in Nigeria
Nigeria is unarguably the largest economy in Africa with an estimated population of about 200 million. The country operates a federal system of government, which allows devolution of power amongst the Federal Government and the 36 federating States. Patterned after the English legal system, Nigerian laws derive majorly from: (i) Nigerian legislation; (ii) received English laws (comprising Common law, equitable principles and Statutes of General application); (iii) Nigerian case laws (judicial precedent); (iv) Nigerian customary laws; (v) Islamic laws; and (vi) international laws and principles. The applicability of English laws and principles is subject to the provisions of Nigerian legislation and courts’ decisions. The Nigerian Court system is centralised with all appeals from State and Federal High Courts going to the Court of Appeal and then to the final Appeal Court being the Nigerian Supreme Court.
In the recent past, the President of the Federal Republic of Nigeria, President Muhammadu Buhari GCFR, has refused to give his assent to several bills forwarded to his office for his approval by the National Assembly. The President’s refusal to assent to the bills has been a cause for concern to many Nigerians. Prominent among the bills to which the President refused assent are the Nigerian Film Commission Bill 2018, the Chartered Institute of Pension Practitioners of Nigeria Bill 2018, the Immigration Amendment Bill 2018, the Climate Change Bill 2018, the Digital Rights and Freedom Bill 2018, the Chartered Institute of Training and Development of Nigeria (Establishment) Bill 2018, the Nigerian Aeronautic Research Rescue Bill 2018, the Federal Mortgage Bank of Nigeria Bill 2018, the National Housing Fund Bill 2018, the National Institute of Credit Administration Bill 2018, the National Bio-Technology Development Agency Bill 2018 as well as the Ajaokuta Iron and Steel Completion Fund Bill. Continue reading “Recent Spate of Refusal of Assent to Bills by the President”
Historically, there has been a dearth of a comprehensive antitrust and competition legislation in Nigeria. Prior to the enactment of the Federal Competition and Consumer Protection Act, 2019 (“FCCP Act” or the “Act”), the Investment and Securities Act, 2007 (“ISA”) had some anti-trust provisions which gave the Securities and Exchange Commission (“SEC”) power to regulate competition in Nigeria. Before the FCCP Act, the ISA had wide antitrust provisions (when compared with other sector-based antitrust legislations) which mostly regulate SEC’s grant of consent to mergers between business entities. SEC could refuse consent to a merger, acquisition or takeover, on the ground that it is inimical to competition. It could, on the other hand, order the breakup of a company if its activities substantially lessen or prevent competition. Another instance of sectorial legislation with antitrust provisions is the Electric Power Sector Reform Act, 2005 which regulates the power sector. In addition, certain sector-specific regulations are also in force to govern competition within various sectors. However, to provide for an all-encompassing and comprehensive legislation to regulate competition and protect the interests of consumers across all sectors, the FCCP Act was enacted.
On 18 March 2019, the Central Bank of Nigeria (“CBN”) published a circular dated 07 March 2019 to all microfinance banks in Nigeria (“MfBs”) titled, “Review of Minimum Capital Requirement for Microfinance Banks in Nigeria’’ (“Revised Circular”). The Revised Circular seeks to revise the minimum capital requirement for all MfBs on which it had earlier issued a circular on 22 October 2018.
In Nigeria, there was a void in the corporate sector due to the absence of a comprehensive legislation in corporate governance regime. However, this absence was mitigated for by sector-specific corporate codes issued by their respective regulators to address this challenge. In order to consolidate the various codes of different sectors and establish a unified corporate governance framework, the Financial Reporting Council of Nigeria (“FRCN”), released the National Code of Corporate Governance 2016. However this was suspended as there were questions relating to its legality and how it may negatively impact the ease of doing business in Nigeria.