Restructuring and insolvency—Nigeria—Q&A guide

The following Restructuring & Insolvency practice note provides comprehensive and up to date legal information covering:

  • Restructuring and insolvency—Nigeria—Q&A guide
  • 1. What main legislation is applicable to insolvencies and reorganisations?
  • 2. What entities are excluded from customary insolvency or reorganisation proceedings and what legislation applies to them? What assets are excluded or exempt from claims of creditors?
  • 3. What procedures are followed in the insolvency of a government-owned enterprise? What remedies do creditors of insolvent public enterprises have?
  • 4. Has your country enacted legislation to deal with the financial difficulties of institutions that are considered ‘too big to fail’?
  • 5. What courts are involved? What are the rights of appeal from court orders? Does an appellant have an automatic right of appeal or must it obtain permission? Is there a requirement to post security to proceed with an appeal?
  • 6. What are the requirements for a debtor commencing a voluntary liquidation case and what are the effects?
  • 7. What are the requirements for a debtor commencing a voluntary reorganisation and what are the effects?
  • 8. How are creditors classified for purposes of a reorganisation plan and how is the plan approved? Can a reorganisation plan release non-debtor parties from liability and, if so, in what circumstances?
  • 9. What are the requirements for creditors placing a debtor into involuntary liquidation and what are the effects? Once the proceeding is opened, are there material differences to proceedings opened voluntarily?
  • More...

Restructuring and insolvency—Nigeria—Q&A guide

This Practice Note contains a jurisdiction-specific Q&A guide to restructuring and insolvency in Nigeria published as part of the Lexology Getting the Deal Through series by Law Business Research (published: June 2021).

Authors: Mike Igbokwe (SAN) & Company—Michael Igbokwe; Victor Okotie; Emmanuel Bassey; Aanuoluwapo Ogidan

1. What main legislation is applicable to insolvencies and reorganisations?

Although no standalone legislation governs insolvency and restructuring in Nigeria, it is governed primarily by:

  1. the Companies and Allied Matters Act 2020 (CAMA);

  2. the Companies Winding-Up Rules 1983;

  3. the Investment and Securities Act 2007;

  4. the Federal Competition and Consumer Protection Act, 2018;

  5. the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act 1994 (FBFMB);

  6. the Nigeria Deposit Insurance Corporation Act 1988 (as amended in 2006) (NDIC Act);

  7. the Banks and Other Financial Institutions Act 2004 (BOFIA); and

  8. the Asset Management Corporation of Nigeria Act 2010 (as amended in 2019) (AMCON Act).

2. What entities are excluded from customary insolvency or reorganisation proceedings and what legislation applies to them? What assets are excluded or exempt from claims of creditors?

he Insurance Act prohibits the voluntary winding up of insurers, except in amalgamations, transfers or acquisitions.

The BOFIA prohibits banks from entering into an agreement or arrangement for mergers, amalgamations, reconstructions, reorganisations or the disposal of interest without the prior consent of the governor of the Central Bank of Nigeria.

The NDIC Act

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