Question:
Examine the difference between CAMA 2004 and CAMA 2020 and suggest which one is more suitable to regulate company Law related
Issues?
Introduction :
Companies and Allied Matters Act (CAMA) is one of the critical pieces of legislation which enhances better business climate and promotes Micro, Small and Medium Scale Enterprises (MSMEs). The Act provides a regulatory framework for how businesses should be carried out in the country.
DIFFERENCE :
1. CAMA 2020 is
Divided into 7 Parts (A-G):
PART A- CORPORATE AFFAIRS COMMISSION,PART B- INCORPORATION OF COMPANIES AND,INCIDENTAL MATTERS,PART C- THE LIMITED LIABILITY PARTNERSHIP,PART D- THE LIMITED PARTNERSHIP,PART E- BUSINESS NAMES,PART F- INCORPORATED TRUSTEES, PART G- GENERAL, With a total of 871 Sections.
While CAMA 2004 is Divided into 3 Parts (A-C),
PART A- COMPANIES,PART B- BUSINESS NAMES,PART C- INCORPORATED TRUSTEES,
With a total of 613 Sections.
2. CAMA 2020 By virtue of Section 34(2) of CAMA 2020, the Corporate Affairs Commission would be able to establish companies using any means of electronic communication to facilitate an automated reservation of names and registrations.
While CAMA 2004 is
There is no provision for E-registration of companies.
3. CAMA 2020 The minimum number of people that can set up a private company has been reduced to one (1) by Section 18(2) of CAMA 2020
While CAMA 2004
Section 18 of CAMA 2004 provides that any two or more persons may form and incorporate a company.
4. CAMA 2020 provides for the formation and incorporation of limited liability partnerships.
While CAMA 2004
No provision for limited liability partnerships to be incorporated under the Act.
5. CAMA 2020 Replaced this condition of getting the consent of the AG Federation with a duty on the commission to cause the application to be advertised in Three (3) national newspaper.
While came 2004
Section 26(5) CAMA 2004 provides that the memorandum of a company limited by Guarantee shall not be registered without the consent of the Attorney General of the Federation
In response to the above differences,
I am here to propose the motion which says CAMA 2020 is better than CAMA 2004 with my following reasons :
1. Transfer of shares: CAMA 2020 enables transfer of shares which is very good because even without meeting in person ,someone can transfer his/her shares to the one that wants to buy it easily.
2. In CAMA 2020 shareholders are allow to host virtual electronic meeting online which goes a long way in making emergency meetings possible to solve company problems.
3. CAMA 2020 allows the establishment of the administrative committee which also goes a long way to make companies achieve their goals and objectives.
4. CAMA 2020 don't allow a person to be a director in more than 5 public companies which is very good and healthy because the work will move smoothly,faster and not be a task loaded for the director.
5. CAMA 2020 has a total of 871 sections which will help address alot of issues that CAMA 2004 will not address because it only has 613 sections.
6. CAMA 2020 has 7 parts which addresses and include 4 extra 4 important parts that CAMA 2004 will not address.
Conclusion :
Company Allied Matters Act is an important documents because it contains the Law that that governs the companies,so as to provide the employee and employer a favourable place of settling disputes as human beings are not perfect,these laws put in place are the laws that most atimes bring justice to people that are at the point of being cheated in a company.
Reference:
• https://www.thisdaylive.com/index.php/2023/01/09/cama-2020-and-end-of-authorised -share-capital-regime-implications-for-companies?amp=1
• https://www.capitalaceattorneys.com/differences-between-the-2004-companies-and-allied-matters-act-and-the-2020-companies-and-allied-matters-act/
