CAC: The mess, game-changing leadership and show of shame

For every beginning, there must be an end. It may come when anticipated or prior to the expected time. The sure thing is that the end will definitely come.

This truism applies to life generally, what more of a tenured appointment into a public office. It was, therefore, not surprising when about two weeks ago, the tenure of A.G Abubakar, the Registrar-general (RG) of Corporate Affairs Commission (CAC), came to an end.

What was surprising to many was the public show of shame displayed by workers at the headquarters of the Corporate Affairs Commission (CAC) in Abuja.

While many right-thinking Nigerians continue to ponder over the rationale of their action, others who are conversant with the sort of reforms introduced by the immediate past RG know that the show of shame brings to light, the depth of corruption in public service.

Although the unsuspecting public may not be aware, those conversant with happenings at the CAC know too well that all throughout the tenure of AG Abubakar, it was not business as usual for some staff who are used to cutting corners hence their reaction to the change of guard.

Since his appointment as the Registrar-General on January 7, 2020, AG Abubakar’s priority was to consolidate the various initiatives on Ease of Doing Business to support the Economic Recovery and Growth Plan of the Federal Government at the time and up to his last day in office. In pursuance of this objective, he made remarkable achievements which are very visible for all to see.

On March 22, 2020, the Commission published the Draft Operations Checklists and invited inputs from Customers, other stakeholders and the general public. The Operations Checklists were to standardise the Commission’s service processes and procedures with a view to improving service delivery.

This was closely followed by the publication of Guidelines on Holding Annual General Meetings (AGMs) of Companies Using Proxies.

On 26th March 2020, and in response to the Federal Government directive on physical distancing as well as restriction on the maximum number of persons at gatherings in order to curb the spread of the corona virus pandemic (COVID-19), the Commission published guidelines for Companies who wished to hold their AGMs during this period. The Companies were advised to take advantage of Section 230 of the Companies and Allied Matters Act (CAMA), 1990 which allowed holding of AGMs of Companies using proxies. This was to ensure that Companies were still able to fulfil the requirements of law within the period.

It would be recalled that on 30th March 2020, the Federal Government announced the first phase of nationwide lockdown beginning Tuesday, March 31st 2020 due to the COVID-19. This was at a time that threat of the pandemic had forced major economies in the world to shut down physically.

The situation also affected Company registration services globally. Some jurisdictions, including Kenya, South Africa and Uganda suspended services while a few others like United Kingdom (UK) and Nigeria provided skeletal online services.

On 4th May 2020, the Federal Government announced the partial ease of lockdown and re-opening of the economy. The working days were reduced to Mondays, Wednesdays and Fridays and working hours from 8:00 am to 2:00pm. The cadre of officers allowed at work were officers on Grade Level 14 and above (i.e. Principal Managers and above in the case of the Commission, representing less than 20% of its workforce). It was clear that the Commission would not be able to deliver services in the manner it did before the pandemic.

The Commission was thus constrained to suspend its service delivery timelines. In order to manage the service delivery expectations of Customers and the general public therefore, the Commission published a notice on 15th May 2020, informing Customers and the general public that its earlier published service delivery timelines were suspended.

Of course, there was suspension of manual searches by Customers (this became necessary to reduce physical contact with Customers and, more importantly, secure the safety as well as integrity of documents in the files). Other measures included the Issuance of search reports by the Commission; and notification to Customers when the outputs were ready for collection.

Plausibly, the CAC initiated the generation and printing of Tax Identification Number (TIN) on Certificate of Incorporation. To achieve this, the Commission collaborated with the Federal Inland Revenue Service (FIRS) to merge the process of obtaining Tax Identification Number (TIN) for companies upon registration. The reform was completed on 29th June, 2020. Since that date, TIN is automatically generated and printed on the incorporation certificate upon completion of the incorporation process. This reform eliminated the time that was hitherto associated with applying for and obtaining TIN from the FIRS by companies after incorporation.

There is also the Delivery of Pre-Incorporation Certificates to Customers through Designated Courier Companies which became effective on 10th August 2020 (for Abuja) and 31st August 2020 (for Lagos). The Commission dispensed with the requirement for submission of original documents (physically or otherwise) before collection of pre-incorporation certificates. Instead, a process was put in place for receiving or sending documents/applications from or to Customers by e-mail. The Commission fully relied on documents uploaded online by the Customers and as approved.

With effect from 10th August 2020 also, the Commission commenced the phased introduction of a new Service Delivery Framework which dispensed with the physical presence of Customers in its offices. This was necessary in part to ensure strict compliance with the various directives on social distancing in order to curb the spread of the COVID-19 Pandemic.

The new framework required Customers to submit applications/documents to the Commission either through designated e-mail addresses or courier companies. The Certified True Copies (CTCs) or other outputs of approved applications were forwarded to the Customers through their selected courier Companies.

In the case of queried applications, customers were contacted by e-mail or phone with details of the Qu Upgrade and procedure for the resolution. The Commission could, however, invite Customers to visit its office where further clarifications or details were required.

Interestingly, ahead of the commencement of implementation of the Companies and Allied Matters Act 2020, on 1st January 2021, the Commission began the upgrade of the Company Registration Portal (CRP) to accommodate the changes introduced by the Act. The upgrade was also to enable filing of post-incorporation applications electronically.

The upgrade started on 28th December 2020 and was concluded on 3rd January 2021.

Also, the Commission published the Companies Regulations 2021 approved by the then Honourable Minister of Industry Trade and Investment, Otunba Adeniyi Adebayo upon recommendation by the Commission after extensive engagement with stakeholders. The Regulations came into force on 1st January 2021 and complements the Companies and Allied Matters Act 2020 (CAMA) in the conduct and regulation of registration under the Act.

Through the Regulations, filing fees for registration of all entities under the CAMA were reduced by the elimination of fees hitherto payable by Customers to obtain CTCs of documents at registration. Certified extracts of entities’ information at registration are now issued by the Commission at no cost to Customers.

Other new services that were introduced included full electronic search for entities, Premium Service/VIP Lounge Facilities (single and multiple transactions); Bulk products (access by Specified Public Authority or Credit Reference Agency to information not on public record) and DVD Directories.

The Regulations also contain relevant model articles for companies pursuant to Section 34, CAMA.

Conscious of the need to constantly inform the public, the CAC embarked on Sustained Public Enlightenment and Education on the Companies and Allied Matters Act, 2020 (CAMA) where the Commission continued to explore the traditional and social media to enlighten and educate the general public on the Companies and Allied Matters Act 2020 (CAMA) ahead of its implementation. Sessions were held on television, radio, Zoom and in-person with select audience to bridge knowledge gap and build capacity for stakeholders on the requirements of the new Act.

Two major events in 2020 largely shaped the reform initiatives and activities of the Commission thereafter to date. These were the global Corona Virus (COVID-19) Pandemic and the repeal and re-enactment of the Companies and Allied Matters Act.

It would be recalled that the Corona Virus (COVID-19) pandemic practically shut down economies globally. The attendant lockdown, physical distancing and restrictions on number of persons allowed at public gatherings disrupted company proceedings. Particularly hit were public companies who found it impracticable to physically meet for their Annual General Meetings (AGMs). To address this challenge, the Commission advised such companies who wished to hold their AGMs during the period to take advantage of Section 230 of the Companies and Allied Matters Act 1990 which allowed holding of AGMs of companies by proxies and published Guidelines for doing so.

The second event, as earlier mentioned, was the Repeal and Re-Enactment of the Companies and Allied Matters Act.

On the 7th of August 2020, the Companies and Allied Matters Act 2020 (CAMA) was signed into law. The Act repealed the Companies and Allied Matters Act 1990 and re-enacted same with more robust provisions better fitted to today’s realities. The Act improved the business environment and performance across the economy as well as reduced direct compliance costs for businesses. It also reduced entry thresholds and regulatory compliance bottlenecks for new and existing businesses; relaxed governance requirements in the case of small and private companies in the areas of statutory minimum for membership, general meetings, accounts, audit, etc.; introduced orderly and more effective procedures for business rescue and resolution of insolvency as well as enhanced transparency and disclosures in areas of ownership, control and accountability. The implementation of the Act commenced on the 1st day of January 2021.

In the wake of the coming into force of the CAMA 2020, the Commission initiated several reforms from 2021 to date in order to consolidate the various initiatives on Ease of Doing Business as well as support the Economic Recovery and Growth Plan of the Federal Government. Highlights of the reforms and activities are as enumerated below.

The Commission developed and published the Companies Regulations 2021 (CR) to complement the full application of the new CAMA 2020. The CR contains procedural prescriptions for certain transactions, revised application forms, fees and penalties. It also exhibits relevant model articles for companies pursuant to Section 34 of the CAMA. The CR came into force on 1st January 2021 to complement the full application of CAMA.

Other laudable reforms embarked upon in 2021 included the deployment of end-to-end Electronic Registration Solution.

On 3rd January, 2021, the Commission deployed an upgraded Company Registration Portal (CRP) adequate to the requirements of the CAMA 2020. The upgraded CRP is an end-to-end electronic registration solution which enables customers to initiate and complete registration and post-registration applications electronically as well as generate outputs remotely. Notable capabilities of the upgraded CRP include: one-man company registration; submission of signature electronically; E-certificates with Quick Response (QR) code for verification; E-extracts with updated information and QR code for verification; protection of restricted and personal information of promoters of entities; integration of data submission and document upload for seamless transactions, etc.

There is also the introduction of Electronic Search and Certified Extracts. This allows customers to view the information of an entity at N1,000.00 fee. The information is available as “view only” and where hard copies are required, the customer may request for certified extracts.

Additionally, too, there is the Introduction of Entity Electronic Account which allows registered entities to submit post-registration documents and statutory returns to the Commission on the Company Registration Portal (CRP) through a dedicated account managed by an administrator or any other person appointed by such entities.

The game-changing narrative is almost endless under A.G Abubakar as the Registrar-General. With the above intimidating but under-reported achievements, he was naturally-bound to become a victim of character assassination by organised criminals within a system who couldn’t continue their business as usual, hence the show of shame called celebration of his exit from CAC.

Mohammed Haruna is a Public Policy Analyst.