Stakeholders have advocated legal and regulatory structures aimed at addressing business recovery challenges for economic growth, financial stability and long-term recovery.
They made the call at the Business Recovery and Insolvency Practitioners Association of Nigeria (BRIPAN) annual international conference on Thursday in Lagos.
The News Agency of Nigeria (NAN) reports that the event had as its theme: “Restructuring and Insolvency in Times of Economic Challenges.”
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BRIPAN is an association of lawyers, accountants and bankers with bias in insolvency and business rescue.
Registrar General, Corporate Affairs Commission (CAC), Hussaini Magaji, said the utilitarian value of the concept of business recovery was more compelling now than in other times.
Magaji was represented by Terver Ayua-Jor, the Special Assistant to the Registrar-General.
He said changes in approach and in legal framework came with the promulgation of the Companies and Allied Matters (CAMA) Act No.3 of 2020 Sections 434 –549 and 718 – 727.
Magaji said the Act introduced three new major insolvency processes namely Company Voluntary Arrangement (CVA), Company Administration (CA) and Netting.
He added that the Act in section 705 (1) (d) recognised BRIPAN as one of the professional associations entitled to be given automatic authorisation to practice as insolvency practitioners by the commission.
Magaji said that in addition to the development of a framework for accreditation of insolvency practitioners, the commission issued insolvency regulations 2022 to drive the new framework.
The CAC registrar, however, noted that the current legal and administrative reforms had not translated into quantum leap in business recovery processes.
He said that in spite of the available legal reforms, less than 10 CVA & CA applications had been filed in the last three years of the issuance of insolvency regulation.
According to him, there are still more filings of the traditional processes of liquidations and receiverships.
“It is hoped that this will change after this conference creates the necessary awareness on the need to adopt business recovery as the default insolvency process as required by law- CAMA.
“This is necessary not only because it is the requirement of law but more importantly, it is the most efficient business decision to preserve income, jobs and other economic benefits to all stakeholders in the company and the economy,” he said.
The President, BRIPAN, Mr Chimezie Ihekweazu, SAN, said a lot of businesses were struggling in spite of the huge efforts by the present administration to engender positive changes to the economy.
Ihekweazu stated the need to improve some aspects of the country’s laws to support business management.
He said the association, as leaders and key stakeholders in the insolvency and restructuring landscape, was tasked with ensuring that Nigeria’s legal and regulatory structures are equipped to address these challenges of business recovery.
“BRIPAN’s capacity building programmes will continue to equip members with advanced skills and knowledge to navigate the evolving landscape of business rescue and insolvency practice in Nigeria.
“In recognition of its statutory responsibilities and its objectives, we would continue to forge alliances by strengthening its partnership with key institutions in public and private sectors as well as professional groups,” he said.
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Mazi Afam Osigwe, SAN, President, Nigerian Bar Association (NBA), stressed that in these times of uncertainty, the expertise of restructuring and insolvency professionals had become most crucial.
Osigwe said that effective restructuring and insolvency processes were essential to preserving business value, protecting jobs, and fostering investor confidence.
He stated that as global and national economies experienced pressures from multiple fronts, legal and financial experts needed to collaborate to find sustainable solutions.
Osigwe added that the NBA, the largest professional body of lawyers in Nigeria, recognised the important role BRIPAN played in shaping insolvency practice in our country.
“We remain committed to working alongside BRIPAN to improve the legal and regulatory frameworks governing restructuring and insolvency.
“Our shared goal is to ensure that businesses facing financial difficulties have the best chance of survival while maintaining fairness and transparency for creditors, employees, and other stakeholders.
“It is through events like this that we can ensure the continued development of our legal and economic systems, which are so vital to Nigeria’s growth and stability,” he said.
Also, Dr Anthony Idigbe, SAN, Senior Partner, Punuka Attorneys and Solicitors, stressed the importance to organise and sensitise the insolvency environment the Nigeria, particularly on cross border insolvency practices.
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Idigbe noted that while CAMA 2020 was a major leap in developing the insolvency regime in Nigeria, there were still some gaps due to lack of adoption of model law on cross border insolvency.
The adoption, Idigbe said, would make it easy to have cross border transactions and proceedings in Nigeria and create opportunities for practitioners appointed to get relief within Nigeria.
“It is important for Nigeria to have practitioners who can work across border in insolvency area.
“The other issue is that although BRIPAN is recognised under CAMA 2020, it is still yet to achieve chartered status so it must seek legislation for it to be chartered,” he said.
