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Part XIV

Establishment, Jurisdiction, Authority and 

Procedure of the Investment and Securities Tribunal

 

 

224.  (1)   There is hereby established a body to be known as the Investments and Securities Tribunal (hereafter referred to as "the Tribunal") to exercise the jurisdiction , power s and authority conferred on it by or under this Decree.

 

(2)     The Minister shall specify the matters and places in relation to which the Tribunal may exercise jurisdiction.

 

225.  (1)  The Tribunal shall consist of nine persons (hereinafter referred to as "Capital Market Assessors") to be appointed b y the Minister, one of whom shall b e the Chairman.

 

(2)     The Chairman shall be a legal practitioner who has been so qualified to practice for a period of not less than 15 years with cognate experience in cap ital market matters.

 

(3)     The Chairman shall preside at every sitting of the Tribunal and in his absence the members shall appoint one of their number to b e the Chairman.

 

(4)     The quorum at any sitting of the Tribunal shall be five.

 

226.   A person shall not be qualified for appointment as a Capital Market Assessor unless he is knowledgeable about the law s, regulations, norms, practices and operations of the Capital Market.

 

227.   A Capital Market Assessor shall hold office for a term of five y ears from the date on which he assumes his office or until he attain s the age of seventy years, which ever is earlier.

 

228.  (1)   A Capital Market Assessor may, by notice in writing under his hand addressed to the Minister resign his office:

 

Provided that the Capital Market Assessor shall, unless he is permitted by the Minister to relinquish his office sooner, continue to hold office until the expiry of three month s from the date of receipt of such notice or until a person duly appointed a s his successor assumes his office or until the expiry of his term of office, whichever is the earlier.

 

(2)     A Capital Market Assessor shall be removed from office by an order by the Minister on the grounds of proven charges of misbehaviour or incapacity after due inquiry has been made and the Capital Market Assessor concerned has been informed of the charges a against him and given an opportunity of being heard in respect of these charge s.

 

229.    The salary and allowances payable to and the terms and conditions of service of the Capital Market Assessors shall be such as may be prescribed in their letters of appointment: Provided that neither the salary and allowances no r the other terms and conditions of service of a Capital Market Assessor shall be varied to his disadvantage after appointment.

 

230.   If, for reason other than temporary absence; any vacancy occurs in the office of a Capital Market Assessor, then the Minister shall appoint another person in accordance, with the provisions of this Decree to fill the vacancy.

 

231.  The question as to the validity of the appointment of any person as a Capital Market Assessor shall not be the cause of any litigation in any Court or tribunal and no act or proceedings before the Tribunal shall be called into question in any manner on the ground merely of any defect in the constitution of the Tribunal.

 

232.  (1)  There shall be for the Tribunal a Secretary who Shall-

 

(a)     be appointed by the Minister;

 

(b)     subject to the general control of the Capital Market Assessors, be responsible for keeping records of the proceedings o f the Tribunal;

 

(c)     be the head of the secretariat and responsible for-

 

(i)     the day-to-day administration, and

 

(ii)     the direction an d control of all other employees, of the Tribunal.

 

233.  (1)  The Tribunal shall have power to appoint for the Tribunal such other employees as it may deem necessary for the efficient performance of its functions under or pursuant to this Decree an d shall have power to pay person s so employ ed such remuneration (including allowances) as the Tribunal may determine.

 

(2)     The terms and conditions of service of employees of the Tribunal shall be as may be determined by the Tribunal.

 

(3)     For the purposes of the application of the Pensions Act, any power exercisable under the Act by the Minister or authority of the Federal Government (not being the power to make regulations under section 23 thereof) is hereby vested in the Tribunal and not by any other person or authority.

 

(4)     Subject to subsection (2) of this section, the Pensions Act shall in its application by virtue of subsection (3) of this section to any office, have effect as if the office were in the civil service of the Federation within the meaning of the Constitution of the Federal Republic of Nigeria 1979.

 

(5)     Accordingly service in the Tribunal shall be approved service for the purpose of the Pensions Act, and accordingly, an officer and other persons employed in the Tribunal shall in respect of their service in the Tribunal be entitled to pensions, gratuity and other retirement benefits enjoyed by persons holding equivalent grades in the public service of the Federation.

 

(6)     Nothing in the section shall prevent the appointment of a person to any office on terms which preclude the grant of a pension and gratuity in respect of that office.

 

234.  (1)   The Tribunal shall have power to adjudicate on disputes, and controversies arising under this Decree and the rule s and regulations made thereunder.

 

(2)     The Tribunal shall in particular adjudicate on matters relating to -

 

(a)     the interpretation of any law , enactment or regulations to which this Decree applies;

 

(b)     disputes between the Commission and a Securities Exchange or Cap ital Trade Point;

 

(c)     disputes between Capital Market Operators and the Securities Exchanges or Capital Trade Point;

 

(d)     disputes between Capital Market Operators;

 

(e)     disputes between Capital Market Operators and their clients; and

 

(f)     disputes between quoted companies and the regulators or the Securities Exchanges.

 

235.  Where in the course of its investigation, the Commission discovers evidence of possible criminality the Commission shall be obliged to pass such information to the appropriate criminal prosecuting authorities, such as, the office of the Attorney-General of the Federation an d the Attorney-General of the State.

 

236. (1)    A person aggrieved by any action or decision of the Commission under this Decree, may institute an action in the Tribunal or appeal against such decision within the, period stipulated under this Decree.

 

(2)     An appeal under this Part of this Decree shall be filed within a period of thirty days from the date on which a copy of the order which is being appealed against is made, or deemed to have been made by the Commission and it shall be in such form and be ac companied by such fee as may be prescribed:

 

Provided that the Tribunal m ay entertain an appeal after the expiry of the said period of thirty days if it is satisfied that there w as sufficient cause for the delay.

 

(3)     On receipt of an appeal under subsection (2) of this section the Tribunal may, after giving the parties an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against.

 

(4)     The Tribunal shall cause a copy of every order so made to the parties to the appeal and to the Commission.

 

(5)     The Tribunal, shall in the exercise of its powers under this Decree, conduct its proceedings in such manners as to avoid undue delays accordingly, the Tribunal shall dispose of any matter before it finally within three months from the date of the commencement of the action.

 

237.   (1)   The Tribunal may makes rules regulating its procedures.

 

(2)     The Tribunal shall have, for the purposes of discharging its functions under this Decree, power to -

 

(a)     summon and en force the attendance of any person an d examine him on oath;

 

(b)    require the discovery an d production of documents;

 

(c)     receive evidence on affidavits;

 

(d)     call for the examination of witness or documents;

 

(e)     review its decision s;

 

(f)     dismiss, an application for default or deciding matters ex-parte;

 

(g)     set aside any order or dismissal of any application for default or any order passed by it ex parte; and

 

(h)     do anything which in the opinion of the, Tribunal is incidental or ancillary to its functions under this Decree.

 

(3)     Any proceeding before the Tribunal shall be deemed to be a judicial proceeding and, the Tribunal shall be deemed to be a civil court for all purposes.

 

(4)     Proceedings of the Tribunal m ay be, held in camera a s when it is deem ed appropriate by the Chairman.

 

238.   (1)   A complainant or Appellant, as the case may be, may either appear in person or authorise one or more legal practitioner s or any of its officers to present him o r its case before the Tribunal.

 

(2)    Every individual or company in a case before the Tribunal shall be entitled to be represented at the hearing bf an Appeal by a merchant bank, a stockbroker, a solicitor or chartered accountant or financial adviser:

 

Provided that, if the person intended by the company to be its representative in any a matter before the Tribunal is unable for good cause to attend the hearing thereof, the Tribunal may adjourn the hearing for such reasonable time as it thinks fit, or admit the appeal to be made by some other person or by way of a written statement.

 

239.   The provisions of any statute of limitation shall as far as may be necessary apply to any appeal brought before the Tribunal.

 

240.  The onus of proving any complaint within the Capital Market shall be on the complainant or appellant as the case may be.

 

241.  (1)  The Tribunal may give its judgement in written orders by making or imposing sanctions such as are not limited to fines, suspensions, withdrawal of licences, specific performance, restitution as it may deem appropriate in each case.

 

(2)     A certified true copy of the decision of the Tribunal shall be supplied to the parties upon request made within thirty days of such decision.

 

(3)     An award or judgement of the Tribunal shall be enforced as if it were a judgement of the Federal High Court upon registration of a copy of such award or judgement with the Chief Registrar of the Federal High Court by the party seeking to enforce the a ward or judgement.

 

242.   Save as provided elsewhere in this Decree, no Civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal constituted under this Decree is empowered by or under this Decree to determine and do injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred on the Tribunal by or under this Decree .

 

243.  (1)   Any person dissatisfied with a decision of the Tribunal constituted under this Decree may appeal against such decision on points of law to the Court of Appeal up on giving notice in writing to the Secretary to the Tribunal within thirty days after the date on which such decision was given.

 

(2)     A notice of appeal filed pursuant to subsection (1) of this section shall clear all the grounds of law on which the appellant's case is based. If the Commission is dissatisfied with the decision of the Tribunal, it may appeal against such decision to the Court o f Appeal on a points of law by giving notice in writing a s specified in subsection (1) of this section to the Secretary within thirty days after the date on which such decision was given.

 

(3)     Upon receipt of a notice of appeal under subsection (1) or (2) of this section, the Secretary to the Tribunal shall cause the notice to be given to the Chief Registrar o f the Court of Appeal along with all the exhibits tendered at the hearing before the Tribunal.

 

244.   Each party to an appeal shall bear its own cost.

 

245.   An appeal against the decision of the Court of Appeal at the instance of either party or the Commission shall lie to the Supreme Court.

 

 

Part XV

Miscellaneous

 

246.   Without prejudice to the foregoing provisions of this Decree, the Minister may give to the Commission such directives as appear to him to be just and proper for the effective discharge of the functions of the Commission under this Decree an d it shall be the duty of the, Com mission to comply.

 

247.  (1)   If at any time the Minister is of opinion-

 

(a)     that on account of grave emergency, the Commission is unable to discharge the functions and duties imposed on it by or under the provisions of this Decree; or

 

(b)     that the Commission has persistently made default in complying with any directive issued by him under this Decree; or

 

(c)     in the discharge of the functions and duties imposed on it by or under the provisions of this Decree and as a result of such default the financial status of the Commission or the administration of the Commission has deteriorated; or

 

(d)     that circum stances exist which render it necessary in the public interest so to do;

 

the Head of State, Commander-in-Chief of the Armed Forces may, on the recommendation of the Minister suspend the Com mission for such period, no t exceeding six months, as m ay be specified in the notification.

 

(2)    Upon the publication of a notification of suspension under subsection (1) of this section all the members of the Com mission shall, as from the d ate of suspension, vacate their office.

 

(3)     On the expiration of the suspension specified in the notification issued under subsection (1) of this section, the Minister, with the approval of the Head of State, Commander-in- Chief of the Armed Forces may reconstitute the Commission .

 

248.   The Commission shall furnish to the Head of State, Commander-in -Chief of the Armed Forces through the Minister reports pertaining to any proposed or existing programme for the promotion and development of the securities industry in Nigeria.

 

249.   The Commission may, by general or special order in writing delegate to any member, officer of the Commission or any other per son subject to such condition s, if any, as may b e specified in the order, such of its powers an d functions under this Decree as it may deem necessary.

 

250.   Notwithstanding the provisions of any other law or enactment to the contrary, any legal practitioner employed by the Commission shall be entitled to represent the Commission before an y court or the Tribunal.

 

251.   No suit, prosecution or other legal proceedings shall lie against the Federal Government or any officer of the Federal Government or any member, officer or other employee of the Com mission for anything which is done in good faith or intend ed to be don e under this Decree, or the rule s or regulations; made thereunder.

 

252.  Save as otherwise specifically provided under the provisions of this Decree whosoever contravenes or attempts to contravene or aids or abets the contravention of the provisions of this Decree or of any rules or regulations made thereunder, commits an offence and is liable on conviction to a fine not exceeding N100,000 or to imprisonment for a term not exceeding three years o r to both such fine and imprisonment.

 

253.  (1)  Where an offence under this Decree has been committed by a company, every person who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceed ed against.

 

(2)     Notwithstanding anything contained in subsection (1), where an offence under this Decree has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of the offence and shall be liable to be proceed ed against.

 

254.     For the purposes of this section -

 

(a)     "company" means any body corporate and includes a firm or other association of individuals; and

 

(b)     "director" , in relation to a firm , means a partner in the firm .

 

255.   (1)   If the Minister is of the opinion that it is necessary or expedient so to do in the public interest, he may, by order published in the Gazette, exempt any person or class of persons buying or selling securities or otherwise dealing with the securities market from the operation of the provisions of this Decree.

 

(2)     The provisions of this Decree shall be in addition to, and not in derogation of the provisions of any other law or enactment for the time being in force.

 

256.   (1)  If any difficulty arises in giving effect to the provisions of this Decree, the Minister may, by order, published in the Gazette, make such provisions, not inconsistent with the provisions of this Decree as may appear to be necessary for removing the impediment:

 

Provided that no order shall be made under this section after the expiry of five years from the commencement of this Decree .

 

257.   (1)   The Minister may by order make such transitional provisions as appear to him necessary or expedient to give full effect to the pro visions of this Decree.

 

(2)     All assets, funds, resources and other movable, or immovable property which immediately before the commencement of this Decree were vested in the Commission established by the Securities and Exchange Commission Decree 1988 shall by virtue of this Decree and without further assurances, be vested in the Commission established by this Decree.

 

(3)     Every employee holding any office under the Securities and Exchange Commission existing immediately before the commencement of this Decree shall continue to hold his office in the Commission established b y this Decree on the same tenure and upon the same terms and conditions of service as respects remuneration, leave, pension fund, retirement and other terminal benefits in the Com mission established by this Decree.

 

258.  (1)   The Commission may make regulations -

 

(a)     providing for anything requiring to be prescribed under this Decree; and

 

(b)     generally for carrying out the principles an d objectives of this Decree.

 

(2)    Any instrument issued under subsection(1) of this section shall be under the signature of the Director-General of the Commission and the Secretary or any other officer of the Commission as may be designated by him.

 

259.  (1)  The Commission may appoint one or more committees to carry out, on its behalf such of its functions as the Com mission m ay determine.

 

(2)     A committee appointed under subsection (1).of this section shall consist of such number of persons as may be determined by the Commission; and a person other than a member of the Commission shall hold: office on the committee in accordance with the term s of his appointment.

 

(3)     A decision of a committee of the Com mission shall be of no effect until it is confirmed by the Com mission.

 

260.  (1)  The fixing of the seal of the Commission shall be authenticated by the signature of the Director-General or of any per son specifically authorised by him to act in that capacity.

 

(2)     Any contract or instrument which, if made or executed by a person not being a body corporate, would not be required to be under seal may be made or executed by or on behalf of the Commission by the Chairman or any person specially authorised to act for that purpose by the Commission.

 

(3)     Any document purporting to be a document duly executed under the seal of the Commission shall be received in evidence and shall, unless an d until the contrary is proved, b e presume d to be so executed.

 

(4)     The validity of any proceedings of the Commission or of a committee thereof shall not be adversely affected by any vacancy in the membership of the Com mission or committee, or b y any. defect in the appointment of a member of the Commission or of a committee, or by reason that a person not entitled to do so took part in the proceeding s of the Com mission or committee.

 

261.  (1)   Notwithstanding the provisions of this Decree the relevant provisions of all existing enactments, including the following -

 

(a)     the Trustees Investment Act;

 

(b)     the Borrowing b y Public Bodies Act;

 

(c)     the Companies and Allied Matters Decree 1990;

 

(d)     the Insurance Decree 1997 ;

 

(e)     the Central Bank o f Nigeria Decree 199 1;

 

(f)     the Nigerian Social Insurance Trust F und Decree 199 3;

 

(g)     the Banks And Other Financial Institution Decree 199 1;

 

(h)     the Nigerian Investment Promotion Decree 1995;

 

(i)     the Foreign Exchange (Monitoring And , Miscellaneous Provision s) Decree 1 995;

 

(j)     the Chartered Institute of Stock Brokers Decree 1992;

 

shall be read with such modification as to bring them into conformity with the provision s of this Decree .

 

(2)     If the provisions of any other law, including the enactments specified in subsection (1) of this section, are inconsistent with the provisions of this Decree, the provisions of this Decree shall prevail and the provisions of that other law shall, to the extent of the inconsistency, be void.

 

262. (1)   The Commission may, from time to time, make rules and for the purpose of giving effect to the regulations. provisions of this Decree and may in particular, without prejudice to the generality of the foregoing provisions, make regulations -

 

(a)     determining, from time to time, in consultation with the Minister, what other business shall be included in the definition of investment and securities business;

 

(b)     prescribing the forms for returns an d other information required under this Decree;

 

(c)    prescribing the procedure for obtaining any information required under this Decree;

 

(d)    requiring returns to be made within the period specified therein by any company or enterprise to which this Decree applies;

 

(e)     prescribing the procedure an d criteria for approval of mergers, acquisitions and business combinations under this Decree ;

 

(f)     prescribing any fees payable under this Decree;

 

(g)     prescribing that the provisions of this Decree shall no t apply or shall apply with such modifications (if any) as may be specified in the regulations to any person or class of persons or any security or class I of securities or to an y transaction;

 

(h)     prescribing the information to be contained in any prospectus or offer documents filed under this Decree;

 

(i)     prescribing the procedure, criteria for approval and authorisation of Unit Trust Schemes and the information and documents to be filed with any application for such approval and authorisation;

 

(j)     prescribing the activities which constitute "insider dealings" the rules governing dealings in securities by insiders and defining the term "insider dealings" ;

 

(k)    without prejudice to the provisions of the Companies and Allied Matters Decree 1990 specifying for the protection of investors -

 

(i)     the matters to be disclosed relating to the public issue of capital, transfer of securities of public companies and other matters incidental there to,

 

(ii)     the form, manner and procedure for obtaining proxies including the information to be disclosed to investors before proxies are given by any person, and

 

(iii)     the manner in which such matters shall be disclose d by the companies;

 

(l)     prescribing the returns to be made by public companies in respect of unclaimed dividends;

 

(m)     providing for anything requiring to be prescribed under this Decree; and

 

(n)     generally for carrying out the principles an d objectives of this Decree.

 

(2)     Any instrument issued under subsection (1) of this section shall be under the signature of the Chief Executive of the Commission and the Secretary or any other officer of the Commission as may be designated by him.

 

(3)     Any regulation made under this Decree shall come into force fifteen days after receipt by the Minister or on publication in the Gazette or other official document unless the Minister, before the effective date of any regulation, orders that it be modified, amended or rescinded.

 

(4)     Notwithstanding the provisions of subsection (1) of this section the Commission may, from time to time, amend or revoke rules for purposes of giving effect to the provisions of this Decree and regulations made thereunder.

 

(5)     Any regulations or rules made pursuant to this Part of this Decree may, where appropriate, prescribe penalties not exceeding a fine of 5000 for every day of default or imprisonment for six months or both such fine and imprisonment for any violation of the regulation or rule.

 

263. (1)  The following enactments are hereby repealed -

 

(a)     the Lagos Stock Exchange Act;

 

(b)     the Nigerian Enterprises Promotion Issue of Non-voting Equity Shares Decree 1990;

 

(c)     the Securities and Exchange Commission Decree 1988; and

 

(d)     Part XVII of the Companies and Allied Matters Decree 1990.

 

(2)     The following enactments are amended to the extent provided -

 

(a)     the Capital Gains Act: section 3(d) is hereby repealed;

 

(b)     the Venture Capital (Incentives) Decree 1993,

 

(i)     sections 1(2), (3)(a), (4) and (5) and 4(b) are hereby repealed, and

 

(ii)    substitute for the words "Risk Fund" in sections 2, 5(1)(2) and 6, the words "Federal In land Revenue Service";

 

(c) the Nigerian Investment Promotion Commission Decree 1995: section 21(2) is hereby repealed.

 

(3)     It is hereby declared that without limiting the provisions of the Interpretation Act, the repeal or amendment of these enactments shall not affect any document made or anything whatsoever done or purported to have been don e under the enactments so repealed.

 

(4)     Every order , requirement, certificate, notice, direction, or thing decision, authorisation, con sent, application, request or thin g mad e, issued, given or d one under any enactment repealed by this Decree shall, if in force at the commencement of this Decree, continue in force and have effect as if made, issued, given or done under the corresponding provisions of this Decree.

 

 

Part XVI

Interpretation and Citation

 

264.     In this Decree, un less the context otherwise requires -

 

"agent" means a per son authorised by another to act for or in place of him and in relation to a securities dealer, includes a person who is, or has been a banker of the dealer at any given time;

 

"approved securities organisation" means a body corporate which is approved by the Commission under this Decree as a securities organization;

 

"associated persons" means a subsidiary, affiliate or agent of a member of any self-regulatory organization ;

 

"auditor" means an approved company auditor within the meaning of the Companies and Allied Matters Decree , 1990;

 

"a depository or custodian company" means a company acting as a custodian of securities in connection with a system of central handling of securities w hereby all securities of a particular class of an issuer deposited within the system are treated as fungible and may be transferred, loaned or pledged b y book-keeping en try without physical delivery of certificates;

 

"Board" means the Board or Council, in relation to a Securities Exchange or Capital Trade Point and includes the persons for the time being in whom the management of the Securities Exchange or Cap ital Trade Point is vested;

 

"book" includes any register, document or other record of information and any account or accounting record, however compiled, recorded or stored, whether in written or printed form or micro-film or electronic pro cess or otherwise;

 

"broker" means any person engaged in the business of effecting transactions in securities for the account of others;

 

"Cap ital Trade Point" mean s an Exchange registered by the Com mission pursuant to this Decree, which constitutes, maintains or provides market place facilities for bringing together purchasers and sellers of securities or for otherwise performing, with respect to securities, the functions commonly performed by a Securities Exchange;

 

"certificate of registration" means any certificate or licence issued by the Commission as a part of its registration functions under this Decree;

 

"clearing and settlement companies" means any corporate body who acts as an intermediary, in making payments or deliveries or both in connection with transactions in securities and provides facilities for comparison of data regarding the terms of settlement of securities transactions on or for the allocation of securities settlement responsibilities;

 

"Commission" means the Securities and Exchange Commission referred to in subsection (1) of section I of this Decree;

 

"company" has the same meaning assigned to it in the Companies and Allied Matters Decree 1990;

 

"dealer " means a per son engaged in the business of buying and of selling securities for his account through a broker, sub-broker or any person in so far as he buys or sells securities for his own account either individually or in some fiduciary capacity but not as part of a regular business;

 

"dealer's representative" mean s a person, by whatever name described, in the direct employment of, or acting for, or by arrangement with, a dealer, who performs for that dealer any of the functions of a dealer (other than work ordinarily performed by accountants, clerks or cashiers) whether his remuneration is by way of salary, wages, commission or otherwise; and includes an y director or officer o f a body corporate who perform s for the body corporate any of those functions (whether or not h is remuneration is as aforesaid );

 

"defalcation" means the act of a defaulter, act of embezzling, failure to meet an obligation, misappropriation of trust funds or money held in an y fiduciary capacity and failure to properly account for such funds;

 

"dealing in securities" means (whether as principal or agent) making or offering to make with any person, or inducing or attempting to induce any person to enter into or to offer to enter into -

 

(a)     any agreement for or with a view to acquiring, disposing or subscribing for, or underwriting of securities; or

 

(b)     any agreement the purpose or pretended purpose of securing a profit to any of the parties from the yield of securities or by reference to fluctuations in the price of securities;

 

"director" has the same meaning as is assigned to it in the Companies and Allied Matters Decree, 1 990;

 

"esusu" means any Community Savings Collection Scheme;

 

"executive officer" in relation to a body corporate, means any person by whatever name called and whether or not he is a director of the body corporate who is concerned or takes part in the management of the body corporate;

 

"Exchange" means any exchange registered by the Commission pursuant to this Decree which constitutes, maintains or provides a market place for bringing together, purchasers and sellers of securities or for otherwise performing with respect to securities the functions commonly perform ed by a stock exchange;

 

"Government Securities" means securities which are direct obligations of and guaranteed as to principal and interest repayment by the Federal Government of Nigeria, or a State or Local Government;

 

"insider trading" occurs where a person or group of persons who are in possession of some confidential. and price sensitive -information not generally available to the public, utilises such information to buy or sell securities for the benefit of himself, itself or an y person;

 

"investment adviser" means a person who -

 

(a)     carries on a business of advising others concerning securities;

 

(b)     as part of a regular business issues or promulgates analyses or makes reports concerning securities; or

 

(c)     pursuant to a contract or arrangement with a client, undertakes on behalf of the client (whether on a discretionary authority granted by the client or otherwise) the management of a portfolio of securities for the purpose of investment:

 

so however that the term investment adviser shall not include -

 

(i)     a bank as defined in section 2 of the Bank and Other Financial Institutions Decree 1 991,

 

(ii)     a company or society register ed under the Insurance Decree 1 997,

 

(iii)     a solicitor and advocate or accountant in practice whose carrying on of that business is solely incidental to the practice of his profession ,

 

(iv)     a dealer or his employee or a dealer's representative or an exempt dealer whose carrying on of that business is solely incidental to the conduct of his business of dealing in securities, or

 

(v)     the proprietor of a newspaper and holder of a permit issued under the Newspaper Decree 199 3 and where -

 

(a)     insofar as the newspaper is distributed generally to the public it is distributed only to subscribers to, and purchasers of, the newspaper for value;

 

(b)     the advice is given or the analysis or reports are issued or promulgated only thro ugh that newspaper;

 

(c)     that no person receives any commission or other consideration for giving the advice or for issuing or promulgating the analysis or reports; and

 

(d)     the advice is given and the analysis and reports are issued or promulgated solely as incidental to the con duct of that person's business as a newspaper proprietor;

 

"investment representative" means a per son, in the direct employment of or acting for or by arrangement with any of the functions of an investment adviser. (other than work ordinarily performed by accountants, clerks or cashiers) whether his remuneration is by way of salary, wages, commission, or otherwise; and includes any director or officer of a body corporate who performs for such body corporate any of those functions (whether or not his remuneration is as a foresaid);

 

"jobbers" are person s who carry on the business of acquiring or disposing securities on behalf of others;

 

"licence" includes -

 

(a)     a dealer's licence;

 

(b)     an investment adviser's licence; or

 

(c)     a representative's licence,

 

"listing rules or requirements", in relation to a body corporate which maintains or provides, or proposes to maintain or provide, a stock market for dealing in securities in a Securities Exchange or Capital Trade Point means rules governing or relating to -

 

(a)     the admission to the official list of the body corporate, of bodies corporate, governments, unincorporated bodies or other persons for the purpose of the quotation on the stock market, or made available by bodies corporate, governments, unincorporated bodies or other persons or the removal from that official. list and for other purposes; or

 

(b)     the activities or conduct of bodies corporate, governments, unincorporated bodies and other persons who a re admitted to that list, whether those rules -

 

(i)     are made by the body corporate or are contained in any of the constituent documents of the body corporate; or

 

(ii)     are made by another person an d adopted b y the body corporate;

 

"member company" means a company which carries on business of dealing in securities and is recognised as a member company by a Securities Exchange or Cap ital Trade Point;

 

"Minister" means the Minister responsible for matters relating to finance and "Ministry" shall be construed accordingly;

 

"portfolio investment" means an investment in shares or other securities traded on a Securities Exchange or Capital Trade Point;

 

"prospectus" has the meaning assigned to it in the Companies and Allied Matters Decree 1990;

 

"quotation", in relation to securities and in relation to a stock market of a Securities Exchange or Capital Trade Point includes the displaying or providing, on a stock market of a Securities Exchange or Capital Trade Point, information concerning -

 

(a)     prices or considerations; in a case where offers to sell, purchase or exchange the securities at particular prices, or for particular consideration, Are made or accepted on that stock market;

 

(b)     offer s or invitations; in a ca se where offers or invitation s are made on that stock mark et, being offers or invitations which are intended, or may reason ably be expected , to result, whether directly or indirectly, in the making or acceptance of offers to sell, purchase or exchange the securities at particular prices or for particular consideration, those prices or that consideration; or

 

(c)     in any case, the price at which, or the consideration for which, particular persons, or particular classes of persons, propose, or may reasonably be expected, to sell, purchase or exchange the securities;

 

"relevant authority" -

 

(a)     in relation to a member company, means the Securities Exchange; or

 

(b)     Cap ital Trade Point by which the comp any is recognised;

 

"representative" mean s a dealer's representative or an investment representative;

 

"rules", in relation to a Securities Exchange or, Capital Trade Point, means the rules governing the members thereof by whatever name called and wherever contained and includes rules contained in the memorandum of association and the articles of association of the Securities Exchange or a Capital Trade Point;

 

"securities" means-

 

(a)     debentures, stocks or bonds issued or proposed to b e issued by a government;

 

(b)     debentures, stocks, shares, bonds or notes issued or proposed to be issued by a body corporate or unincorporated;

 

(c)     any right or option in respect of any such debentures, stocks, shares, bonds or notes; or

 

(d)     any interest as defined in section 106 of the Companies and Allied Matters Decree 1990;

 

(e)     futures contracts;

 

(f)     bills of exchange;

 

(g)     promissory notes or certificates of deposit issued by a bank which has a tenure of not less than nine months, and the term securities in this Decree includes those securities in the category of the securities listed in (a) - (g) above which may be transferred by means of any electronic mode approved by the Commission and which may be deposited, kept or stored with any licensed depository or custodian company as provided under this Decree;

 

"Securities Exchange" mean s a Stock Exchange or an approved securities organisation such as a Commodity Exchange, Metal Exchange, Petroleum Exchange, Options, Futures, Over the Counter Market, and other derivatives exchanges;

 

"self regulatory organization" means any registered Securities Exchange, Capital Trade Point, an association of securities dealers, clearing corporation or any other self-regulatory body app roved as such by the Commission;

 

"share" means a share in the share capital of a body corporate and includes stock except where a distinction between stock and shares is express or implied;

 

"share certificate" means an instrument of a body corporate certifying that the person therein named is entitled to a certain number of shares and is prima facie evidence of his ownership whether electronically expressed or otherwise as may be approved by the Commission and kept, lodged or stored with a licensed depository or custodian company in accordance with the provision s of this Decree ;

 

"stockbroker" means a person who is a member of a Securities Exchange or Capital Trade Point and registered

by the Commission as a mark et operator;

 

"stock market" mean s a market, or other place o r facility at which or on which securities are traded ;

 

"sub-broker" means a person who has satisfied the conditions laid down by a Securities Exchange or Capital Trade Point for such status and who is therefore authorized to deal in the securities listed on the Exchange under the control and supervision of a dealing member.

 

"transfer agent" means any person who engages on behalf of an issuer of securities or on behalf of itself in -

 

(a)     counter-signing securities up on issuance ;

 

(b)     monitoring the issuance of securities with a view to preventing unauthorized issuance , a function commonly performed by a person called a registrar;

 

(c)     registering the transfer of securities;

 

(d)     exchanging or converting securities;

 

(e)     transferring, record ownership of securities by book-keeping entry without physical issuance of securities certificates;

 

(f)     offers to sell, purchase or exchange securities regularly made or accepted;

 

(g)     offers or invitations which are intended, or may reasonably be expected, to result, whether directly of indirectly, in the making or acceptance of offers to sell, purchase or exchange securities; or

 

(h)     information regularly provided concerning the prices at which, or the consideration for which, particular persons, or particular classes of persons, propose, or may reasonably be expected, to sell purchase or exchange securities;

 

"trust account" means a trust account established under this Decree ;

 

"trust deed" means the agreement drawn up between the trustees and the manager for regulating the operation

of a unit trust scheme;

 

"trustee" under a unit trust scheme means the person in whom the property for the time being subject to any trust created in pursuance of the scheme is or m ay be vested in accordance with the term s of the trust;

 

"underwriter" mean s a person who has purchased from an issuer with a view to or offers o r sells for a n issuer in connection with the distributions of any security or participates or has a direct or indirect participation in any such undertaking; but does not include a person whose interest is limited to a commission from an underwriter or a dealer not in excess of the usual and customary distributor's or seller's com mission;

 

"unit trust scheme" means any arrangement made for the purpose, or having the effect, of providing facilities for the participation by persons as beneficiaries under a unit trust, in profits or income arising from the acquisition, holding, management or disposal of securities or, any other property;

 

"units" in relation to a unit trust scheme, means an y units described (whether as un its or otherwise) into which are divided the beneficial interest in the assets subject to any trust created under the scheme.

 

265.     This Decree may be cited as the Investments and Securities Decree 1999 .

 

 

Schedules

 

 

First Schedule

Section 2(4)

 

Proceedings of the Commission

 

1.    (1)     Subject to this Decree and section 27 of the Interpretation Act, the Commission may make standing orders regulating its proceedings or those of any of its committees.

 

(2)     At any meeting of the Commission the Chairman shall preside but if he is absent, the members present at the, meeting shall appoint one of their number to p reside at that meeting.

 

(3)     Where the Commission desires, to obtain the advice of any person on a particular matter, the Commission may co -opt him as a member for such period as it thinks fit; but a person who is a member by virtue of this sub-paragraph shall not be entitled to vote at any meeting of the Commission and shall not count towards a quorum.

 

Committees

 

2.     (1)     The Commission may, appoint one or more standing or ad-hoc committees to carry out on its behalf such of its functions as it may determine.

 

(2)     A committee appointed under this paragraph shall consist of such number of persons ( not necessarily members of the Commission) as may be determined by the Commission; and a person other than a member of the Com mission shall hold office on the committee in accordance with the term s of his appointment.

 

(3)     A decision of a committee of the Com mission shall be of no effect until it is confirmed by the Commission.

 

(4)     The quorum o f a meeting of the Com mission shall be six.

 

(5)     The Chairman shall have casting vote.

 

3.     Any member of the Commission and any person holding office on a committee of the Commission who has a personal interest in any contract or arrangement entered into or proposed to be considered by the Commission or a committee thereof shall forthwith disclose his interest to the Commission an d shall not vote on any question relating to the contract or arrangement.

 

 

 

Second Schedule

 

Investments and Investment Business

 

PART I

Types of Investments

 

Investments include -

 

Shares etc.

 

1.     Shares and stock in the share capital of a company.

 

Debentures

 

2.     Debentures , including debenture stock , loan stock, bonds certificates of deposit and other instruments creating or acknowledging indebted ness, not being instruments falling within paragraph 3 of this Schedule.

 

Government and Public Securities

 

3.     Loan stock, bonds and other instruments creating or acknowledging indebtedness issued by or on behalf of a government, local authority or public authority.

 

Instruments Entitling to Shares or Securities

 

4.     Warrants or other instruments entitling the holder to subscribe for investments falling within paragraph 1,2 or 3 of this Schedule.

 

Certificates Representing Securities

 

5.     Certificates or other instruments which confer -

 

(a) property rights in respect of any investment falling Within paragraph 1, 2, 3 or 4 of this Schedule;

 

(b)     any right to acquire, dispose of, underwrite or convert an investment, being a right to which the holder would be entitled if he held any such investment to which the certificate or instrument relates; or

 

(c)     a contractual right (other than an option) to acquire any such investment otherwise than by subscription.

 

Units in Collective Investment Scheme

 

6.     Units in a collective investment scheme, including shares in or securities of an open-ended investment company.

 

Options

 

7.     Options to acquire or dispose of-

 

(a)     an investment falling within any other paragraph of this Part of this Schedule;

 

(b)     currency of the Federal Republic of Nigeria or of any other currency traded on the Exchanges and Capital Trade Points;

 

(c)     gold or silver; or

 

(d)     an option to acquire or dispose of an investment falling within this paragraph by virtue of sub-paragraph (a), (b) or (a) of this Schedule.

 

Futures

 

8.     Rights under contract for the sale of a commodity or property of any other description under which delivery is to be made at a future date at a p rice agreed up on when the contra ct is made.

 

9.     Or an y other form s of investment or capital instrument within the meaning of investment generally.

 

 

Part II

Activities Constituting Investment Business

 

Dealing in Securities

 

1.     Buying, selling, subscribing for or underwriting investments or offering or agreeing to do so, either as principal or as an agent.

 

Arranging deals in Investments

 

2.     Making, or offering to make-

 

(a)     arrangements with a view to another person buying, selling, subscribing for or underwriting a particular investment; or

 

(b)     arrangements with a view to a person who participates in the arrangements buying, selling, subscribing for or underwriting investments.

 

Notes

 

(1)     This paragraph does not apply to a person by reason of his making, or offering or agreeing to make, arrangements with a view to a transaction to which he will himself be a party as principal or which will be entered into b y him as agent for one of the parties.

 

(2)     The arrangements in sub-paragraph (a) of paragraph 2 of this Schedule are arrangements which bring about or would, b ring about the transaction in question.

 

Managing Investments

 

3.     Managing, or offering or agreeing to manage, assets belonging to another person if -

 

(a)     those assets consist of or include investments; or

 

(b)     the arrangements for their management are such that those assets may consist of or include investments at the discretion of the per son managing or offering or agreeing to manage them.

 

Investment Advice

 

4.     Giving, or offering or agreeing to give, to persons in their capacity as investors or potential investors advice on the merits of their purchasing, selling, subscribing for or underwriting an investment, or exercising any right conferred by an investment to acquire, dispose of, underwrite or convert an investment.

 

Establishing etc, Collective Investment Schemes

 

5.     Establishing, operating or winding up a collective investment scheme, including acting as trustee of an authorised unit trust scheme.

 

6.     Any other activity falling with in the definition of activities constituting investment business.

 

 

Third Schedule

Section 50(1),53(1)

Mandatory Contents of Prospectus

 

PART I

Matters to be stated

 

The Company's Proprietorship, Management and its Capital Requirement

 

1.     The prospectus shall state -

 

(a)     the number of founders or management or deferred shares (if any) and the nature and extent of the interest of the holders in the property and profits of the company ;

 

(b)     the number of share s (if any) fixed by the company's articles as the qualification of a director, and any provision in the articles as to the remuneration of directors; and

 

(c)     the names, descriptions an d addresses o f the directors or proposed directors.

 

2.     Where shares are offered to the public for subscription, prospectus shall give particulars as to -

 

(a)     the minimum amount which in the opinion of the directors, must be raised by the issue of those shares in order to provide the sums (or, if any part of them is to be defrayed in any other manner, the balance of the sums) requited to be provided in respect of each of the following-

 

(i)     the purchase price of any property purchased or to be purchased which is to be defrayed in w hole or in part out of the proceeds of the issue,

 

(ii)     any preliminary expenses payable by the company, and any commission so payable to any person in consideration of h is agreeing to subscribe for, o r of his procuring subscriptions for, an y shares in the company,

 

(iii)     the repayment of any money borrowed by the company in respect of any of the forgoing matters,

 

(iv)     working capital; and

 

(b)     the amounts to be provided in respect of the matters above mentioned otherwise than out of the proceed s of the issue and the sources out o f which those amounts are to be provided.

 

 

Details Reading to the Offer

 

3.    (1)    The prospectus shall state -

 

(a)     the time of the opening of the subscription lists; and (b) the amount payable on application and allotment on each (including the amount, if any, payable by way of premium ).

 

(2)     In the case of second or subsequent offer of shares, there shall also be stated the amount offered for subscription on each previous allotment made within the two preceding years, the amount actually allotted and the amount (if any) paid o n the share s so allotted, including the amount (if any) pa id by way of premium.

 

4.    (1)     There shall be stated the number, description and amount of any shares, or debentures of the company which an y person h as, or is entitled to be given an option to subscribe for.

 

(2)     The following particulars of the option shall be given -

 

(a)     the period during which it is exercisable;

 

(b)     the price to b e paid for shares or debentures subscribe d for under it;

 

(c)     the consideration (if any) give n or to be given for it or the right to it;

 

(d)     the names and addresses of the persons to whom it or the right to it, was given or, if given to existing shareholders or debenture holders as such the relevant shares or debentures.

 

(3)    References in this paragraph to subscribing for shares or debentures include acquiring them from a person to whom they have been allotted or a greed to be allotted with a view to his offering them for sale.

 

5.     The prospectus shall state the number and amount of shares and debentures which within the two preceding years have been issued, or agreed to be issued, as fully or partly paid up otherwise than in cash; and

 

(a)     in the latter case the extent to which they are so paid up; and

 

(b)     in either case the consideration for which those shares or debenture have been issued or are proposed or intended to be issued.

 

 

Property acquired or to be acquired by the Company

 

6.    (1)     For purposes of paragraphs 8 and 9 of this Schedule relevant property is property purchased or acquired by the company, or proposed to be purchased or acquired -

 

(a)     which is to be paid wholly or partly out of the proceeds of the issue offered for subscription by the prospectus; or

 

(b)     the purchase or acquisition of which has not been completed at the date of the issue of the prospectus.

 

(2)    The two paragraphs referred to in sub-paragraph (1) of this paragraph shall not apply to property -

 

(a)     the contract for which purchase or acquisition was entered into in the ordinary course of the company's business, the contract not being made in contemplation of the issue nor the issue in consequence of the contract; or

 

(b)     as respects which the a mount of the purchase money is not material.

 

7.     As respects any relevant property, the prospectus shall state -

 

(a)     the names and addresses of the vendors;

 

(b)     the amount payable in cash, shares or debentures to the vendor and, where there is more then one separate vendor, or the company is a sub -purchaser, the amounts so payable to each vendor; and

 

(c)     short particulars of any transaction relating to the property complete within the two preceding years in which any vendor of the property to their company or any person who is, or was at the time of the transaction, a promoter or a director or proposed director of the company had any interest direct or indirect.

 

8.     There shall be stated the amount (if any) paid or payable as purchase money in cash, shares or debentures for any relevant property, specifying the amount (if any) payable for goodwill.

 

9.    (1)     Sub-paragraphs (2) to (4) of this paragraph shall apply with respect to the interpretation of paragraphs 6, 7 and 8 of this Schedule.

 

(2)     Every person is deemed a vendor who has entered into any contract (absolute or conditional) for the sale or purchase, or for any option of purchase of any property to be acquired by the company, an y case where -

 

(a)     the purchase money is not fully paid at the date of the issue of the prospectus;

 

(b)     the purchase money is to be paid or satisfied wholly original paid out of the proceeds of the issue offered for subscription by the prospectus; or

 

(c)     the contract depends for its validity or fulfilment on the result of that issue.

 

(3)     Where any property to be acquired by the company is to be taken on lease, the provisions of paragraphs 6, 7 and 8 of this Schedule shall apply as if "the vendor" includes the lessor, 'purchase money' includes the consideration for the lease, an 'sub-purchaser' includes a sub-lessor.

 

(4)     For the purposes of paragraph 8 of this Schedule, where the vendors or any of them are a firm, the members of the firm are not to be treated as separate vendors.

 

Commissions, Preliminary Expenses, etc.

 

10.   (1)    The prospectus shall state -

 

(a)     the amount (if any) paid within the two preceding years, or payable, as commission (but not including commission to sub-underwriters) for subscribing or agreeing to subscribe, or procuring or agreeing to procure subscriptions, for shares in or debentures of the company, or the rate of an y such com mission;

 

(b)     the amount or estimated amount of any preliminary expenses and the person by whom any of those expenses have been paid or are payable, and the amount or estimated amount of the expenses of the issue and the persons by whom any of those expenses have been paid or are payable;

 

(c)     any amount or benefit paid or given within the two preceding years or intended to be paid or given to any promoter, and the consideration thereof.

 

(2)    Sub-paragraph (1)(b) of this paragraph , so far as it relates to preliminary expenses, does not apply in the case of a prospectus issued more than two years after the date at which the comp any is entitled to commence business.

 

Contracts

 

11.   (1)    The prospectus shall give the d ate of, parties to and general- nature of every material contract.

 

(2)     Sub-paragraph (1) of this paragraph does not apply to a contract entered into in the ordinary course of the business carried on or intended to be carried on by the company, or a contract entered into more than two years before the date of issue of the prospectus.

 

Auditors

 

12.     The prospectus shall state the names and addresses of the company's auditors (if any)

 

Interests of Directors

 

13.    (1)     The prospectus shall give full particulars of -

 

(a)     the nature and extent of the interest (if any) of every director in the promotion of, or in the property proposed to b e acquired by , the company;

 

(b)     where the interest of such a director consists in being a partner in a firm, the nature and extent of the interest of the firm..

 

(2)     With the particulars under sub-paragraph (1)(b) of this paragraph must be provided a statement of all sums paid or a greed to be paid to the director or the firm in cash or shares or otherwise by an y person either to induce him to be come, o r to qualify him as, a director o r otherwise for services rendered by him or the firm in connection with the promotion of the company.

 

(3)     This paragraph does not apply in the case of a prospectus issued m ore than two years after the date at which the comp any is entitled to commence business.

 

Other Matters

 

14.    If the prospectus invites the public to subscribe for shares in the comp any an d the company's share capital is divided into different classes of shares, the prospectus shall state the right of voting at meetings of the company conferred by, and the rights in respect of capital and dividends attached to, the several classes of shares respectively.

 

15.     In the case of a company which has been carrying on business or of a business which has been carried on for less than three years, the prospectus shall state the length of time during which the business of the company (or the business to b e acquired, as the case may be) has be en carried on .

 

 

Part II

Auditors and Accountants Reports to be set out in Prospectus

Auditors and Accountants Reports to be set out in Prospectus

Section 50 (1), 53(1)

 

16.    (1)     The prospectus shall set out a report by the company's auditors with respect to-

 

(a)     profits and losses and assets and liabilities, in accordance with sub-paragraphs (2) and (3) of this paragraph, as the case requires; and

 

(b)     the rates of the dividends (if any ) paid by the company in respect o f each class of shares in respect of each of the five financial years immediately preceding the issue of the prospectus, giving particulars of each such class of shares on which such dividends have been paid and particulars of the cases in which no dividends have been paid in respect of any class or shares in respect of an y of those years,

 

and if no accounts have been made up in respect of any part of the five years ending on a date three months before the issue o f the prospectus , the report shall contain a statement of that fact.

 

(2)     If the company h as no subsidiaries, the report shall -

 

(a)     deal with profits and losses of the company in respect of each of the five financial years immediately preceding the issue of the prospectus; and

 

(b)     deal with the assets and liabilities of the comp any at last date to which the company's accounts w ere made up.

 

(3)     If the company h as subsidiaries, the report shall -

 

(a)     deal separately with the company's profits or losses, as provided by sub-paragraph (2) of this paragraph, and in addition deal either -

 

(i)     as a whole with the combined profits or losses of its subsidiaries, so far as they concern members of the company, or

 

(ii)     individually with the profits or losses of each subsidiary so far as they concern members of the company, or, instead of dealing separately with the company's profits or losses, deal as a whole with the profits or losses, of the company and (so far as they concern members of the company) with the combined profits and losses of its subsidiaries; and

 

(b)     deal separately with the company's assets and liabilities as provided by sub-paragraph (2) of this paragraph, and in addition deal either -

 

(i)     as a whole with the combined assets and liabilities of its subsidiaries with or without the company's assets and liabilities, or

 

(ii)     individually with the assets and liabilities of each subsidiary, indicating, as respects the assets and liabilities of the subsidiaries, the allowance to be made for persons other than members of the company.

 

Accountants' Report

 

17.    If, the proceeds of the issue of the shares or debentures are to be applied directly or indirectly in the purchase of any business, or any part of the proceeds of the issue is to be so applied, there shall be set out in the prospectus a report made by accountants upon -

 

(a)     the profits or losses of the business in respect of each of the five years immediately preceding the issue of the prospectus; and

 

(b)     the assets and liabilities of the business at the last date to which the accounts of the business w ere made up.

 

18.    (1)     Sub-paragraphs (2) and (3) of this paragraph apply if -

 

(a)     the proceeds of the issue are to be applied directly or indirectly in any manner resulting in the acquisition of the company of shares in any other body corporate, or any part of the proceeds is to be so applied; and

 

(b)     by reason of that acquisition or anything to be done in consequence of or in connection with it, that body corporate w ill become a subsidiary of the company .

 

(2)     There shall be set out in the prospectus a report made by accountants upon -

 

(a)     the profits or losses of the other body corporate in respect of each of the five years immediately preceding the issue of the five years immediately preceding the issue of the prospectus; and

 

(b)     the assets and liabilities of the other body corporate at the last date to which its accounts were made up.

 

(3)     The accountants' report required by this paragraph shall -

 

(a)     indicate how the profits or losses of the other body corporate dealt with by the report would, in respect of the shares to be acquired, have concerned members of the company and what allowance would have fallen to be made, in relation to assets and liabilities so dealt with, for holders of other shares, if the comp any ha d at all material time held the shares , if the company had at all material time held the shares to be acquired; and

 

(b)     where the other body corporate has subsidiaries, deal with the profit or losses and the assets and liabilities of the body corporate and its subsidiaries in the manner provided by sub-paragraph (3 ) of paragraph 16 of this Schedule in relation to the company and its subsidiaries.

 

 

Provisions Interpreting Preceding Paragraphs and 

Modifying them in Certain Cases

 

19.     If, in the case of a company which has been carrying on business, or of a business which has been carried on for less than five years, the accounts of the company or business have only been made up in respect of four years, three years, two years or one year, the preceding paragraphs of this Part have effect as if references to four years, three years, two years or one year (as the case ma y be) were substituted for references five years.

 

20.     The expression financial year, in this Part means the year in respect of which the accounts of the company or of the business (as the case may b e) are made up; an d where by reason of any alteration of the date on which the financial year of the company or business terminates the accounts have been made up for a period greater or less than one year, that greater or less period is for purposes of this Part deemed to be a year.

 

21.     Any report required by this Part shall either indicate by way of note any adjustments as respects the figures of any profits or losses or assets and liabilities dealt with by the report which appear to the persons making the report necessary, or shall make those adjustments an d indicate that adjustments have been made.

 

22.    (1)     A report required by paragraph Schedule shall be made by accountants qualified under this Decree for appointments as auditors of a company.

 

(2)     Such a report shall not be made by any accountant who is an officer or servant, or partner of or in the employment of an officer or servant, of the company or the company's subsidiary or holding company or of a subsidiary of the company's holding company; and in this sub-paragraph, "officer" includes a proposed director, but not an auditor.

 

(3)     The accountant ma king any report for purposes of paragraph 17 or 18 of this Schedule shall be named in the prospectus.

 

 

Fourth Schedule

Section 61, 69(l)

 

Form of Statement of Prospectus to be delivered to the Commission by a 

Company under section 50, 42 or 561 of the Companies and Allied Matters 

Decree 1990 and Reports to be set out in it

 

PART I

Form of Statement and Particulars to be Contained in it

 

Statement in lieu of prospectus delivered for registration by -

 

Pursuance to section ....... of the Companies and Allied Matters Decree 1990.

 

Delivered for registration by ............................. shares of N............... the nominal share capital of the .......................... shares of N................ company divided into .......................... shares of N...............

 

Amount (if any) of above capital which consists of redeemable shares............................

 

The earliest date on which the company has power to redeem these shares .............................................................

..

 

Names, descriptions and addresses o f directors or proposed directors ............................................

 

Amount of shares issued ............................

 

Amount of commissions paid in connection with the issue of the shares ..................................................

 

Amount of discount, if any, allowed on the issue of shares; or so much of them as has not been written off at the date of the statement ............ .............................................................................

 

Amount (if any) paid or payable as commission for subscribing or agreeing to procure subscriptions for any shares or debentures in the company;

 

Amount paid ...................................................

 

Payable .....................................................

Rate of the commission ........................................

 

The number of shares (if any) which persons have agreed of a commission to subscribe absolutely. Rate per cent

...........................................................

 

Unless more than on e year has elapse since the date on which the company was en titled to commence business.

 

Amount of preliminary expenses .....................Naira...............

 

By who m those expenses have been paid or are payable...................

..............................................................................

 

Name of Promoters ..................................................... .............................................................

 

Amount paid or intended to be pa id to promoter .........................

 

Consideration for payment ..............................................

 

Amount (naira) pa id ...........................intended to be paid .....................consideration .......................

 

Any other benefit given to any promoter ...............................

 

Name of promoter ..................................

 

Nature and value of benefit ................................

 

Consideration for giving of benefit consideration....................... ...........................................

 

If the share capital of the company is divided into different classes of shares, the right of voting at meetings of the rights in respect of capital and dividends attach ed to, the several classes of shares respectively.

 

Shares of naira fully paid .............................. upon which naira per s hare credited as paid .................................

 

Number and amount of shares and debentures issued within the two years preceding the date of this statement as fully or partly paid up otherwise than for cash or agreed to be so issued at the date of this statement.

 

Debenture ................................................................ ............................................................................

 

Consideration for the issue o r intended issue of those shares or debenture.

 

Consideration ............................................................. .....................................................

 

Number, description and amount of any shares or debentures which any persons has or is entitled to be given an option to sub scribe for, or to acquire from a person to who m they have been allotted with a view to his offering them for sale.

 

Share of naira of ..............................................

 

Debentures ............................................................ .......................

 

Period during which option is exercisable ............................

until ..........................................................

 

Price to be paid for shares or debentures subscribed for or acquired under option.

 

Consideration ......................................................

 

Consideration for option or right to option.

 

Persons to whom option or, right to option was given or, if given to exist in shareholders or debenture holders as such the relevant share s or debentures .............................................................

 

Names and addresses of vendors of property purchased or acquired, or proposed to be purchased or acquired, or proposed to be purchased or acquired by the company except where the contract for its purchase or acquisition was entered into in the ordinary course of the business intended to be carried on by the company or the amount of the purchase money is not material: or in the case or re-registration of a private company as public, names and addresses of vendors property (1) purchased or acquired, by the company within the two years preceding the date of this statement or (2) agreed or proposed to be purchased or acquired by the company, except where the contract for its purchase or acquisition was entered into in the ordinary course of business and there is no connection between the contract an d the comp any or where the amount of the purchase money is not material.

 

Name.......................................................

 

Address..........................................................

 

Name.............................................................

 

Address............................................................

 

Total purchase price................................................

 

Amount paid or payable in cash, shares or debentures for any such property, specifying the amount paid or payable for goodwill.

 

Cash...............................................................

 

Share...............................................................

 

Debenture ...........................................................

 

Goodwill.............................................

 

Short particulars of any transaction relating to any such property which was completed within the two preceding years and in which any vendor to the company or any person who is, or was at the time of such transaction a promoter director or proposed director of the company had any interest direct or indirect.

 

Particulars -

...............................................

.................................................

 

Date of, parties to, and general nature of every material contract (other than contract entered into in the ordinary course of business o r entered into m ore than two years before the delivery of this statement).

 

Date of ...................................................

 

Parties to ......................... ...................

 

Nature of contract ..........................................

 

Time an d place at which the contracts or copies of them may be inspected and, in the case of a contract wholly or partly in a foreign language, a copy of a translation of it in English or embodying a translation in English or of the parts in a foreign language, a s the case may be, being a translation certified in the pre scribed manner to be a correct translation.

 

Time....................................................

 

Place ......................................................

 

Name of Auditor .............................................

 

Address .....................................................

 

Full particulars, of the nature and extent of the interest of every director in any property purchased or acquired by the company within the two years preceding the date of this statement or proposed to be purchased or acquired by the company or, where the interest of such a director consists in being a partner in a firm, the nature and extent of the interest of the firm with a statement of all s ums pa id or agreed to be p aid to him or to the firm in cash or shares, or otherwise, by any person either to induce him to com e or to qualify him as a director or other wise for services rendered or to be render ed to the company by him or by the firm.

 

Nature and extent, of interest o f director........................ ...........................................................................

..............................................................................

 

Rates of the dividends (if any) paid by the company in respect of each class of shares in the company in each of the five years immediately preceding the date of this statement or since the incorporation of the company whichever period is the shorter.

 

Rates of dividends............................................

...............................................................

....................................................................

 

Particulars of the cases in which no dividends have been paid in respect of any class of shares in any of these years.

 

Particulars (Signature of the persons named above as directors or proposed directors or of their agents authorised in writing).............

 

Date .............................................................

 

 

Part II

Reports to be set out

 

1.     Where is proposed to acquire a business, there shall be set out a report made by account ants (who shall be named in the statement) upon -

 

(a)     the profits or losses of the business in respect of each of the five financial year's immediately preceding the delivery of the statement to the Commission; and

 

(b)     the assets and liabilities of the business at the last date to which the accounts of the business were made up.

 

2.     W here it is proposed to acquire share in a body corporate which by reason of the acquisition or anything to be done in consequence thereof or in connection therewith w ill become a subsidiary of the company , there shall be set out a report made by accountants (who shall be named in the statement) with respect to the profits and losses and assets and liabilities of the other body corporate in accordance with sub-paragraph (1) or (2) of paragraph (1) or (2 ) of paragraph 3 of this Schedule as the case requires indicating -

 

(a)     how the profits or losses o f the other body corporate dealt with by the report would in respect of the shares to be acquired, have concerned members of the company; and

 

(b)     what allowance would have fallen, to be made in relation to assets and liabilities so dealt with, for holder s of other shares, if the comp any ha d at all material times held the shares to be acquired .

 

3.    (1)    If, in the case mentioned in paragraph 2 of this Part of this Schedule the other body corporate has no subsidiaries, the report referred to in that paragraph shall -

 

(a)     so far as regards profits and losses, deal with the pro fits or losses of the body corporate in respect of each of the five financial statement years immediately preceding the delivery of the statement to the Commission; and

 

(b)     so far as regards assets and liabilities, dealt with the assets and liabilities of the body corporate at the late date to which the accounts of the body corporate were made up .

 

(2)     If the other body corporate has subsidiaries, the report shall -

 

(a)     so far as regards profits and losses deal separately with the other body corporate's profits or losses as provided by sub-paragraph (1)(a) of this paragraph; and in addition deal either -

 

(i)     as a whole with the combined profits or losses of its subsidiaries, so far as they concern members of the other body corporate; or

 

(ii)     individually with the profits or losses of each subsidiary, so far as they concern members of the other body corporate; instead of dealing separately with the other body corporate's profits or losses, deal as a whole with the profits or losses of the other body corporate, with the combined profits or losses of its subsidiaries; and

 

(b)     so far as regards assets and liabilities, deal separately with the other body corporate's as sets and liabilities as provided by sub-paragraph (1) of this paragraph and, in addition, deal either

-

(i)     as a whole with the combined assets and liabilities of its subsidiaries, with or without the other body corporate's assets and liabilities; or

 

(ii)     individually with the assets and liabilities of each subsidiary; and shall indicate as respects the assets and liabilities of the subsidiaries the allowance to be made for persons other than m embers o f the company.

 

 

Part III

Provisions Applying to Part I and II of this Schedule

 

4.     In this Schedule the expression "vend or" includes a vendor as de fined in paragraph 10 of the Fifteenth Schedule of this Decree.

 

5.     If, in the case of business which has been carried on, or of a body corporate which has been carrying on business, for less than five years, the accounts of the business or body corporate have only been made up in respect of four years, three years, two years, or one year, Part 11 of this Schedule shall have effect as if references to four years, three years, two years or one year, as the case may be, were substituted for references to five years.

 

6.     Any report required by Part II of this Schedule shall either indicate by way of note any adjustments as respects the figures of any profits or losses of assets and liabilities dealt with by the report which appear to the persons making the report necessary, or shall make those adjustments and indicate that adjustments have been made.

 

7.     Any report by accountants required by Part II of this Schedule shall be made by accountants qualified under this Act for appointment as auditors of a company and shall not be made by any accountant who is an officer or servant, or a partner of or in the employment of an officer or servant of the company , or of the company's subsidiary or holding company or of a subsidiary of the company's holding company; and for the purposes of this paragraph the expression "officer" shall include a proposed director but not an auditor.

 

 

Made at Abuja this 26th day of May 1 999.

 

 

General Abdulsalami Alhaji Abubakar

Head of State, Commander-in-Chief of the Armed Forces

Federal Republic of Nigeria