The Business Facilitation (Miscellaneous Provisions) Bill (the “Business Facilitation Act” or “BFA”) was signed into law on the 14th of February 2023. The bill, now an Act is an initiative of the Presidential Enabling Business Environment Council (“PEBEC”) charged with the responsibility of easing bureaucratic constraints and bottlenecks to doing business in Nigeria. PEBEC has worked collaboratively with the Nigerian Investment Promotion Council to ensure automation, regulatory reforms, trade/port reform and legislative/judicial reforms in Nigeria.
The BFA is divided into eleven sections which set out key changes required in the Nigerian business sector through instruments of transparency, reduction in regulatory bottlenecks and easy business registration. The law highlights some key elements aimed at ensuring this outcome:
- The Act mandates all Ministries, Departments and Agencies (MDAs) to publish a complete and comprehensive list of requirements for obtaining products and services in such MDA which includes permits, and licenses etc. Thus, whenever there is conflict between a published list of requirements and an unpublished list, the published list shall prevail.
- Whenever an applicant makes an application to an MDA, and such MDA refuses or neglects to communicate approval or rejection within the stipulated time, such application shall be deemed approved.
- Section 5 of the Act introduces “One Government”. One Government is a programme aimed at ensuring seamless service delivery across MDAs in record time. It provides a fast solution to applicants who require services from two or more MDAs by ensuring they collaborate processes in products and services delivery. One Government is like a one-stop shop that provides seamless service across several MDAs whenever an applicant’s requirement cuts across different MDAs.
- The BFA stipulates that all MDAs should embed a Service Level Agreement (“SLA”) in their processes. The SLA will serve as a contract between the MDA and each applicant. When signed, it will be binding on both parties, and it will further ensure products and services are delivered at the agreed time.
- The BFA mandates all ports to run a 24-hour operation. This is aimed at improving their profitability and eliminate the losses incurred in the past due to Nigerian ports not operating at night.
- The Act expressly prohibits touting in ports, it further ensures that staff who are not on duty are not allowed in and around the port except with a valid ID and permit for such entry.
- The Act provides for a new single interphase wherein all MDAs in the port will capture, track and record information on all goods arriving and departing from Nigeria and then, transmit captured information to the head of the relevant offices and the National Bureau of Statistics weekly.
The remaining part of the BFA is a Schedule which is divided into twenty-one parts; each part amending a statute relating to the Nigerian Business sector. The remaining part of this article will focus on the amendment of each Act by the BFA.
- AMENDED ACTS OF THE FEDERAL REPUBLIC OF NIGERIA
- THE COMPANIES AND ALLIED MATTERS ACT 2020 – CAMA
The BFA amended 20 sections of the Companies and Allied Matters Act 2020, to accommodate business efficacy. Sections 127, 154 and 171 conspicuously highlight several requirements aimed at aiding ease of doing business in Nigeria. Listed below are key changes outlined in the BFA.
- Section 78: Subsection 3 of CAMA was amended to incorporate a new paragraph “c” that includes exemptions stated in an Act of the National Assembly among grounds for exemption of foreign companies from registration before commencing business in Nigeria.
- Section 127: The amended section 127 provides that share capital can be increased through a general meeting or by a resolution of the board as opposed to the old position where share capital can be increased through the general meeting.
- Section 142: This makes provision for pre-emptive rights of existing shareholders to buy stocks. Subsection 1 restricts the effect of that section to only private companies by inserting the word “private”. In subsection 2, a new paragraph “C” was created, and it states that “if the offer is not accepted within 21 days of notice, the offer shall be deemed declined”. This new provision makes the acceptance of such offer time bound.
- Section 149: Introduces a new subsection 1 which removes the powers conferred on the directors to exercise allotment of shares of a company unless the director has been given such authority by the general meeting or by its articles. Subsection 3 was deleted in the amendment.
- Section 154: Subsection 1 was amended to reduce the time frame for making returns on allotment of shares from 1 month to 15 days.
- Section171: Expressly provides that a share certificate can be provided to a shareholder through electronic means or by physical copy.
- Section 240: The amendment removed the word “private” in subsection 240(2). This means that all companies whether private or public can now hold their annual general meetings (AGM) or other general meetings virtually, provided such meetings are conducted in accordance with the articles of the company.
- Section 244: Section 244 (1) provides that notices of meetings can be given electronically.
- Section 248: Section 248 states that voting in any meeting can be done by show of hands or through any electronic means of choice as opposed to only a show of hands and poll. It is noteworthy that voting at the general meetings of several publicly listed companies has been done via a digital device for some time now. This amendment will aid the adoption of other and more advanced electronic voting methods that will allow members participating virtually to vote.
- Section 378: A new section 378 (1) replaces the old subsection and provides that the financial statement of a company shall be in line with accounting standards prescribed by the Financial Reporting Council only. It removed the previous requirement on financial statements.
- THE NIGERIAN EXPORT PROMOTION COUNCIL ACT
Section 2 of the law was amended to open up membership of the Board of the Council to an array of business representatives in the Nigerian business sector, ranging from agriculture to finance, foreign affairs, and banks. As opposed to the old provision wherein the board representation was very lean and comprised only of individuals from the Ministry of Industry, Trade and Investment. Currently, membership is now up to 13-members.
- THE CUSTOMS AND EXCISE MANAGEMENT ACT
The BFA amended section 2 of the law while introducing a new Section 18A and 18B. The new amendments provide for a “single window” platform. The platform is a facility that allows parties involved in trade and transport to lodge trade-import, export or transit-data required by government departments, authorities, or agencies through a single entry-point interface to fulfil all import, export, transit-related and other regulatory requirements. This provision aims to ensure that lodgment; transit-data, documentation, inspection and examination are coordinated through a single portal and if possible, carried out at the same time.
- THE EXPORT (PROHIBITION) ACT
The amendment in section 1 of the law provides that the prohibited goods as stated in the principal Act can be varied and only the Minister of Finance is authorised to vary the goods prohibited from exportation.
- FINANCIAL REPORTING COUNCIL ACT
Section 59 of the law is amended to include an additional subsection 3, which provides a sample general purpose financial statement for the preparation of financial statements by companies, governmental organisations, and corporations. It maintains that the standard provided in its law and other extant laws and regulation should be maintained subject to the Financial Reporting Council Act.
2.6. THE FOREIGN EXCHANGE (MONITORING AND MISCELLANEOUS PROVISION) ACT
The BFA amended section 6 of the law to specifically state the reasons why the license to buy or deal in foreign exchange can be revoked. In the previous provision, the power to revoke such license was placed unilaterally on the Central Bank of Nigeria without parameters for exercise of the power. However, the new provision itemizes twelve items that could serve as a reason for revocation of a foreign exchange license.
2.7. THE IMMIGRATION ACT
- The BFA amended Section 20 of the law to include subsections 8 and 9. The provisions stipulate a time frame for the acceptance or rejection of travel visas. It also mandates the immigration service to provide every requirement needed in obtaining Visa on its website.
- Section 36 of the law introduced new subsections 4, 5, 6 and 7. The provisions ensure electronic facilitation in the operation, accessibility, technical and service requirements of the Immigration Service. It aims at providing an electronic mechanism for filing documents, returns, information and other specific requirements in the Service.
2.8. THE INDUSTRIAL INSPECTORATE ACT
Section 3 of the law was amended to reflect new business realities. The old section provided that any party who intends to incur capital expenditure above the threshold of twenty-five thousand Naira must obtain a permit from the Industrial Inspectorate Division of the Ministry of Industries. However, the amendment increased the threshold to five million Naira, which is reflective of inflation and current economic realities.
2.9. THE INDUSTRIAL TRAINING FUND ACT
Section 6 of the law provides a new tax regime for an employer with more than 25 employees. The law provides that employers with over 25 employees must contribute at least one percent of his/her annual payroll to the industrial training fund. Compliance with the law is compulsory for companies who wish to bid for contracts with any governmental body.
2.10. THE INVESTMENT AND SECURITIES ACT
“Section 67 of the principal Act was amended by substituting the previous Subsection 1 with a new subsection 1. The amendment expands offerings to private companies but refrains from repeating the prohibition in the old section. What the new 67(1) expressly prohibits is allotment of such securities if the offer does not meet the minimum sum that the directors of the company have stated that they need to carry out the projects they must have listed for the offering in the Prospectus.”
2.11. THE NATIONAL HOUSING FUNDS ACT
Section 4 of the law was replaced with a new section 4 which changed the tax structure under the National Housing Fund. Previously, all employees earning above the National Minimum wage must contribute 2.5% of their monthly income. However, the new provision does not mandate such contributions by employees in the private sector, although employees in the public sector are mandated to contribute same.
2.12. THE NATIONAL OFFICE FOR TECHNOLOGY ACQUISITION AND PROMOTION ACTThe BFA amended Section 5(2) of the law which provides that every contract or agreement entered into by any person in Nigeria with another person outside Nigeria in relation to the transfer of foreign technology to Nigerian must be registered with the National Office for Technology Acquisition and Promotion not later than sixty days from the execution or conclusion of the contract. However, the new law states that companies in the first two years of business operation shall not be liable to penalties for late registration provided the relevant contract is registered before the end of the second year of their business operation.
2.13. THE NATIONAL PLANNING COMMISSION ACT
The BFA amended section 3(2) of the law to include the Director General of the Infrastructure Concession Regulatory Commission as a member of the National Planning Commission.
2.14 THE NIGERIA CUSTOMS SERVICE BOARD ACT
The BFA amended section 3 of the law to increase the functions of the National Customs Service Board. It maintains that the Board shall adopt modern means of operationalisation and develop regulations for carrying out the activities of the service.
2.15. THE NATIONAL INVESTMENT PROMOTION COMMISSION ACT
- The BFA amended section 20 of the law to include a new subsection 3 which provides that an enterprise registered in Nigeria, which subsequently acquires foreign participation after the commencement of business, shall, within three months of such acquisition, register with the commission.
- Also, section 22 was amended to properly define incentives for strategic businesses. The section provides that the commission will clearly state all the requirements needed to qualify for such strategic investment as opposed to the old law where qualification requirements were not clearly stated. It also provides that if a company qualifies for a special incentive, the commission will negotiate such incentive with the investor or company.
2.16. THE NIGERIA OIL AND GAS INDUSTRY CONTENT DEVELOPMENT ACT
The BFA amended section 106 of the law by inserting in alphabetical order the definition of “Nigerian Independent Operator” which is defined as a Nigerian Company.
2.17. THE NIGERIAN PORT AUTHORITY ACT
Section 7 of the Nigerian Port Authority Act is amended to include the use of information and communication technology across all operations in the ports. It amended paragraph “i” of the same section to include the “single window phase” already provided in Section 7(11) of the Business Facilitation Act. This section aims to provide for the adoption of technological advancements across all operations in the ports and to provide a simple and seamless strategy for importation and exportation. The amended section also reduces unwanted personnel in the ports, who could potentially commit crimes.
2.18 THE PATENTS AND DESIGNS ACT
The First schedule to the Patents and Designs Act is amended in paragraph 13 to increase the functions of the Minister. It provides that the Minister shall prescribe the procedure for the application, grant, use and withdrawal of compulsory licenses.
2.19 THE PENSION REFORM ACT
Section 89 of the Pension Reform Act 2014 was amended to provide an alternative application to pension funds. The new provision states that pension funds can be eligible for security lending provided the National Pension Commission approves it. It is worth noting that prior to the amendment, pension funds were prohibited from being used for security lending.
2.20 THE STANDARD ORGANISATION OF NIGERIA ACT
- The Business Facilitation Act amended section 5 (1) of the Standard Organisation of Nigeria Act (“SON Act”) by substituting paragraphs (b)(e) and (i) with a new paragraph which increases the functions of the organisation to include investigation of products and facilities, use of comprehensive inventory and regulation of products specified in the SON Act.
- Also, the amended section 29 of the SON Act is a remarkable provision. Prior to the amendment, the SON Act provides that the Director-General was permitted to instruct the officers of the organisation to seize and detain products that are perceived to be hazardous to life, property or national economy. However, the new provision mandates the Director-General to approach the court and obtain an ex- parte order before entering any premise to seize products.
2.21 THE TRADE MARKS ACT
- The BFA expanded the definition of “trade mark” in section 67 of the Trade Marks Act to include ‘services’, ‘shapes’, ‘packaging’ and ‘colour schemes’. A trade mark is defined:
- as a mark used or proposed to be used in relation to goods or services for the purpose of indicating a connection between the goods or services and a person having the right, either as a proprietor or as a registered user, to use the mark, whether with or without any indication of the identity of that person, and may include shape of goods, their packaging and combination of colour and
- in relation to a certification trade mark, a mark registered or deemed to have been registered under section 43 of the Trade Marks Act.
The Business Facilitation Act has established a new business framework aimed at encouraging Foreign Direct Investment and augmenting pre-existing efforts to enable a business-friendly environment in Nigeria. Importantly, the BFA amended twenty-one business related laws which affect import, export, excise, immigration, foreign investment, securities and ports. Overall, the law is an important addition to Nigeria’s Business Law.
- Telephone (+234 1 472 9890), Fax (+234 1 4605092)
- Mobile (+234.815.119.1865 +234.811.018.0200)
- Email: email@example.com
 Now cited as The Business Facilitation Act, 2022.
 See, Tribune Newspaper https://tribuneonlineng.com/ease-of-doing-business-pebec-identifies-five-priority-reforms-for-7th-national-action-plan/ accessed 28 February 2023.
 The Act is divided into two parts, the first part contains eleven sections while the second part contains the schedule, which is sub-divided into twenty-one parts.
 Section 3(1) Business Facilitation Act 2022.
 Section 3(5).
 Section 4(1).
 Section 6 Business Facilitation Act 2022.
 Sections 6 and 7.
 Section 7(11).
 Part I Business Facilitation Act 2022.
 In The principal Act, Section 149(3) provides that the power to allot shares are not to be exercised by the directors except they are expressly granted power by the company in a general meeting or in the articles of the company.
 The previous requirement provides that financial statements shall comply with the requirements of the First Schedule of CAMA 2020 (so far as applicable) with respect to their form and content.
 Cap N117 LFN 2004, Part II Business Facilitation Act 2022.
 Cap C45 LFN 2004, Part III.
 E22 LFN 2004, Part IV.
 Part V Business Facilitation Act 2022.
 Cap F34 LFN 2004, Part VI.
 The items listed include:
- If the dealer fails to utilize the license within 30 days.
- If the dealer fails to commence its exchange business within six months from the date of the license.
- If the dealer fails to disclose in their application, any material information known to the licensee or reasonably expected to have been known by the licensee.
- If the dealer provides material information which is false.
- If the dealer had not complied with the directive under the Foreign Exchange Act.
- If following the issue of the license the dealer ceases to qualify for the license.
- If the dealer is found to be in malpractice or irregularity in the management of the business of dealing in foreign exchange.
- If the dealer is placed under liquidation, receivership or is adjudged bankrupt.
- If the dealer intends to administer its business in a manner that threatens the interest of customers or potential customers.
- If any of the dealer’s shareholder applies for the liquidation of the company.
- If the dealer has a judicial receiver or manager or any similar officer appointed to manage or take over his undertaking.
- If the dealer has a bankruptcy order or judgment against him/her.
 Cap I1 LFN 2004, Part VII Business Facilitation Act 2022.
 Cap I8 LFN 2004, Part VIII Business Facilitation Act 2022.
 Cap I9 LFN 2004, Part IX.
 Under the previous section 6 of the Industrial Training Fund Act (ITF) an employer has a duty to contribute 1% of the employees’ annual pay to the Industrial Training Fund where the employer has either five or more employees or less than five employees but with a turnover of N50Million and above.
 Part X Business Facilitation Act 2022.
 For instance, under the SEC Rules, if a company seeks to raise N100bn, if the market subscribes for less than 25% of the amount, the offer will be deemed to have failed and the Issuer will have to refund all monies raised from subscribers. However, if the amount crosses N25bn, they would be allowed to keep the money. Under Business Facilitation Act, if the Issuer seeking to raise N100bn had stated in its Prospectus that it needs at least N40bn to be able to meet the most urgent of needs for its business operations, even if it raises N25bn, it would not have met the requirements of the new section 67(1) which has set a new standard before allotment of securities can be made.
 Cap I9 LFN 2004, Part XI Business Facilitation Act 2022.
 Cap N68 LFN 2004, Part XII Business Facilitation Act 2022.
 Cap N66 LFN 2004, Part XIII.
 Cap N100 LFN 2004, Part XIV.
 Cap N117 LFN 2004, Part XV.
 Cap N124A LFN 2004, Part XVI Business Facilitation Act 2022.
 Cap N126 LFN 2004, Part XVII.
 Cap P2 LFN 2004, Part XVIII.
 Cap P4 LFN 2004, Part XIX.
 Cap S9 LFN 2004, Part XX.
 Cap T13 LFN 2004. Part XXI Business Facilitation Act 2022.