The 2020 CAMA and Beneficial Ownership in the Extractive Industry
Communications
3 September 2020
By Charles Uche ESQ
Incorporating and fronting companies is a convenient and effective way of concealing identity, engaging in illicit transactions and evading liabilities. In many countries, a company can be formed without disclosing the identity of the individual who ultimately controls or profits from the business, i.e., the beneficial owner. Criminals and politically exposed persons (PEPs) can assign “nominee” shareholders to be listed on official documents or can list other legal entities (other companies can be shareholders in a company) as the “owners,” thereby creating a chain of companies–often across borders–that can be difficult for investigators and law enforcement to trace and recover.
Connected Development (CODE), has over the year, through its Conflict & Fragility project, in partnership with Oxfam-in-Nigeria advocated for a robust beneficial Ownership transparency through the instrumentality of a robust legislation as an essential means for combating corruption, stemming illicit financial flows, and fighting tax evasion. While many initiatives exist to maintain and disclose beneficial owners of companies in Nigeria, like the Beneficial Ownership Register launched by Nigeria Extractive Industries Transparency Initiative (NEITI) in December 2019, none of them until the enactment of the 2020 Companies and Allied Matters Act (CAMA) had the statutory backing for enforcement.
Documents from Panama papers on Dan Etete and Kolawole Aluko can be used as classical case studies in demonstrating how these two individuals, like many others, capitalised on the non-existent or fragile regulatory framework in Nigeria’s extractive “oil & gas” sector to launder money and evade liabilities which has cost the Nigerian government and people revenue in the billions of dollars. Till date, none of the aforementioned persons has been successfully prosecuted and convicted partly due to concealment of identities and fronting of shell companies in their transactions. Shell companies are legal entities “companies” that are non-operational and lack assets or staff. They are conveniently used by money launderers to keep their identities hidden while they engage in illicit transactions across borders and evade tax.
Dan Etete: Dan Etete, a former Petroleum Minister under Nigerias Dictator Head-of-State, Gen. Sani Abacha had in 1998, incorporated a Shell company named “Malabu Oil & Gas Limited” using a fictitious name “Kweku Amafegha”, with few other persons, while he was the ultimate and beneficial owner of the company – though his real name did not appear in any official documents. Five days after he incorporated this company, he, as Petroleum Minister, awarded this company an oil block “OPL 245”. He used this shell company to launder money across the Nigerian border and acquire luxurious assets, while escaping liabilities.
Kolawole Aluko: Kola Aluko is a businessman and oil executive. Media reports have described Aluko as a key ally to Alison-Madueke, a relationship both have previously denied. He rose to prominence around 2011 when Nigeria’s government awarded two companies he founded or owned valuable oil blocks on a no-bid basis. One of his companies, Atlantic Energy, was created the day before it inked the deals to acquire multimillion-dollar oil licenses.
In Nigeria, only a member of a Public Company (PLC) was under obligation, under the old 1990 CAMA, to disclose in writing when required, the capacity in which he holds any shares in the company; either as a beneficial owner or as a nominee of an interested person. See Sections 94-98, old CAMA.
The 2020 CAMA in section 119 has extended such obligation (to disclose the particulars of shareholding by notifying the company) to persons with significant control in all companies. Similarly, as provided in section 120 of the new CAMA, a person who is a substantial shareholder in a public company and holding (either by himself or by his nominee/proxy) shares in the company which entitle him to exercise at least five per cent (5%) of the unrestricted voting rights at any general meeting of the company, is required to disclose such holding by notifying the company within a stipulated time.
This new disclosure provisions are poised to enhance transparency and prevent asset shielding as well as combat money laundering, terrorism financing and all forms of illicit financial flows by legal entities having limited liability.
While there is no gainsaying that the above disclosure provisions would enhance transparency and accountability in the Extractive sector in Nigeria, especially in the Petroleum Industry, as many of the oil and gas companies are private limited liability companies (LTD); many of which have ‘rightly’ escaped disclosure obligations with no legal sanction – there is also an urgent need for the enactment of the Petroleum Industry Governance Bill (PIGB) which has as one of its core objectives – “to promote transparency and accountability in the administration of petroleum resources of Nigeria”.
Today, I went to the beach with my kids. I found a sea shell and gave it to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.” She placed the shell to her ear and
screamed. There was a hermit crab inside and it pinched her ear.
She never wants to go back! LoL I know this is entirely off topic but I had to tell someone!
%%
Also visit my blog – private adhd diagnosis Bristol
%%
Here is my website – upvc door replacement panel
%%
Review my web blog … Tanjiro Clothes
%%
Feel free to visit my web page investors looking For projects to fund
in africa (turbodatos.cl)
%%
my web-site … private Investor looking for projects to fund
%%
my blog: situs togel resmi toto (Don)
%%
Here is my web page: klee genshin impact cosplay
%%
Feel free to surf to my website … blackjack (Philomena)
%%
Here is my website … make up for Sale
I don’t know if it’s just me or if perhaps everybody else experiencing problems with your blog.
It appears as if some of the written text in your posts are running
off the screen. Can somebody else please comment and let me know
if this is happening to them too? This could be a problem with my internet
browser because I’ve had this happen before. Kudos
Feel free to visit my website; Lean X Keto Reviews
%%
Also visit my web-site … truck injury lawsuit
%%
Feel free to visit my web page … Business funding
Ribera Red
Very interesting site, Thanks for sharing such a good information.
If you would like to take a great deal from this post then you have
to apply these techniques to your won weblog.
%%
my web page Africa Investment Opportunities
%%
Take a look at my web-site ghost alarm
%%
Here is my website … african investor [http://www.dh-sul.com]
%%
My web blog: avon brochure
%%
Have a look at my blog post africa investment opportunities (http://wayoptics.homepage1.co.kr/bbs/board.php?bo_Table=estimate&wr_id=6011)
%%
my blog; Replace upvc door lock
hey there and thank you for your info – I’ve certainly picked up
anything new from right here. I did however expertise a few technical
points using this website, as I experienced to
reload the website lots of times previous to I could
get it to load correctly. I had been wondering if your web hosting is
OK? Not that I’m complaining, but sluggish loading instances times will often affect your placement
in google and could damage your quality score if ads and marketing with Adwords.
Anyway I’m adding this RSS to my e-mail and can look out for
much more of your respective intriguing content.
Ensure that you update this again very soon.
%%
Feel free to surf to my web site: adhd london
%%
Also visit my website – windows in milton Keynes
This post will assist the internet people for
building up new webpage or even a blog from start to end.
%%
Here is my web blog – Fold Up mobility scooter
%%
Review my web-site :: best
%%
Also visit my web blog :: pitch deck Consulting Services
%%
Review my web site … cheap Makeup Sale
%%
My web site … auto injury Lawsuit
%%
Have a look at my blog post – Investment Companies south africa
%%
Here is my website: become A avon rep
%%
Here is my web blog; boat injury attorney
%%
Also visit my blog: Private Adhd diagnosis scotland
%%
Here is my blog: Certified netsuite consultants
free Windows 7 key
%%
My website … how To become avon rep
%%
My blog post how To become avon representative
%%
Feel free to visit my website demon slayer halloween costume,
compraenred.com,
%%
Also visit my webpage :: Repairing upvc Doors
%%
Also visit my webpage … Become a Avon rep
%%
Have a look at my site … consulting Pitch Deck template
%%
Stop by my web blog – 18 wheeler Injury
%%
my web blog hemp shop in Birmingham
%%
Also visit my blog post; Replace Upvc Door Panel
%%
my web site: avon starter kit for representatives; Samara,
%%
Feel free to surf to my web page mobility Scooters to fit in car boot
%%
Feel free to surf to my web page; Car Boot mobility scooter with suspension
You actually make it appear so easy together with your presentation however I in finding this matter to
be really something that I feel I would by no means understand.
It seems too complex and extremely huge for me. I am taking a look forward on your next publish, I will attempt to get the dangle of it!
Fantastic post however I was wondering if you
could write a litte more on this topic? I’d
be very thankful if you could elaborate a little bit further.
Appreciate it!