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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:The Dual Statutory Procedure for Effecting a Scheme of Arrangement in Nigeria: Law Reform and Retrogression
Author:Ogowewo, Tunde IdoloISNI
Periodical:African Journal of International and Comparative Law
Geographic term:Nigeria
Subjects:legal reform
company law
Law, Human Rights and Violence
External link:https://heinonline.org/HOL/Page?handle=hein.journals/afjincol6&id=610&collection=journals&index=journals/afjincol
Abstract:This article examines the dual procedure for effecting a scheme of arrangement in Nigeria. The procedure was introduced into Nigerian company law by the Companies and Allied Matters Act 1990 (CAMA). The CAMA repealed the Companies Decree 1968, from which the present procedure is derived. Although some aspects of the new procedure are based on Professor Gower's draft Companies Code for Ghana (1961), the dual nature of the procedure rests on a misunderstanding on the part of the courts and the draftsman of the way the provisions in the predecessor statute worked. Two factors are responsible for the problems associated with the dual procedure. First, there should never have been two procedures. The article shows that the draftsman took this path due to certain misleading aspects of the Nigerian Law Reform Commission's report on the reform of Nigerian company law (1988). The second factor can be attributed to the case law. In interpreting the relevant provisions of the Companies Decree 1968, the courts failed to comprehend the correct meaning of the term 'arrangement'. After a review of the procedure under the former Companies Decree, the article examines the two sections in the CAMA for effecting a scheme of arrangement, viz. section 539 and section 591. The analysis focuses primarily on arrangements that lead to a merger or takeover. Notes, ref.