THE Corporate Affairs Commission (CAC) has said the newly signed Company and Allied Act (CAMA) 2020 has come to stay, as it is not compulsory for associations to be registered.
The Christian Association of Nigeria (CAN) had described as “satanic”, section 839 (1) and (2) of the Act and urged President Muhammadu Buhari to stop its implementation.
CAN in a statement signed by its President, Pastor Adebayo Oladeji on Thursday, said, “The law, to say the least, is unacceptable, ungodly, reprehensible and an ill-wind that blows no one any good.
“It is a time bomb waiting to explode, and the President should stop the implementation of the obnoxious and ungodly law until the religious institutions are exempted from it.
“The satanic section of the controversial and ungodly law is Section 839 (1) and (2) which empowers the Commission to suspend trustees of an association (in this case, the church) and appoint the interim managers to manage the affairs of the association for some given reasons.”
But, Registrar-General of CAC, Alhaji Garba Abubakar in Abuja, said, “unlike businesses that the law is saying you must register mandatorily if you are carrying out business using names rather than your surname or full names, the law says you must register, but for associations, you don’t necessarily have to register.
“Anybody that feels he does not want to come within regulatory oversight, if you feel your members will agree with you to run the association and they make donations individually, you don’t have to register with CAC.
“But for as long as you register, because is not a business, there are a lot of physical exemptions granted to Associations, the government should be interested in how these organizations are run and whether the income and property are being utilized for the objective enshrined in the constitution of the association.
“These associations have constitutions apart from objectives and the governing structures on how they should operate, so, there is no need for anybody to entertain any fear, the powers of CAC are not absolute, as long as you operate and manage your association in line with the constitution as registered with the CAC, and in line with the law, you don’t have to fear anything.
“One fundamental difference between association and companies is the requirement that whatever asset or property the association owns, should strictly be used to pursue the objectives of the association.
“We have a provision dealing with the suspension of Trustee as enshrined in section F39 of the Company and Allied Act (CAMA) 2020.
“This is not targeted at any particular group, but what we have done is to bring our law to be consistent with what is obtained in other countries; all these provisions borrowed from the Charities Act of the United Kingdom (UK).
“The law says if CAC has reasonable grounds to believe that any Trustee due to misconduct, or mismanagement, or allegation of fraud, after an enquiry – there have to be an enquiry; the meaning of enquiry is that you have to give the other person fair hearing and the accused have to defend themselves.
“CAC will now recommend to the Minister of Industry, Trade and Investment based on their findings and the Minister can approve the suspension of the Trustee.
“There are provisions of the law dealing with dormant accounts by incorporated Trustees, the law has imposed an obligation on the banks to inform the Commission about any account of any Association that has been dormant for the period of five years, and once they give that information, no transaction should be allowed on that account without notifications to CAC, even when we have reasons to believe that the account is now active, they can not allow unhindered access to the account without notification to the CAC.
“The law has also given CAC the right where such an account is dormant to give directives for the balance to be transfered to another Association with similar objective because the whole essence of having money in an incorporated Trustee account is to utilize it to pursue the objective of that association.
“So if you have established an organisation to support maybe the IDPs, and you have money in your account that has been there for five years, you are not supporting anybody and nobody is touching the money, the money is not for you personally, after five years, CAC can give directives that this money should be moved to another organisation that is established for similar objectives so that this money will be utilised.
“Except limited by guarantee, the income and profit cannot be shared by members of an association, but strictly used for the objective of the association.
“If you are on the wrong side of the law, of course, laws are to be obeyed and if there are infractions, there will be a sanction.”