Reaching for a Hat-trick: Notes on the Asset Management Corporation of Nigeria Act Amendment Bill, 2021 (Part II)

Kamsi Atuchukwu

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In the first part of this article, the author introduced the intention behind the proposed amendments to the AMCON Amendment Bill 2021, and two of the proposed amendments – an expansion of the corporation’s powers over debtor(s)’ assets and the commencement of AMCON’s claims at the BOFIA Special Tribunal. In this final part, the author shall examine two more proposed amendments, with his opinion on same.

 

c. Registrable Instruments of Title at Land Registries

The 2019 amendment introduced section 45 (2) which provides that a certificate of judgement obtained in a proceeding constitutes a registrable instrument of title in favour of the Corporation in all land registries in Nigeria. The proposed amendment to this subsection seeks to expand the scope of registrable instruments to include “any document presented by the Corporation as evidencing title, whether legal, equitable or traced in a property…”.

While a registration based on a certificate of judgement should be a seamless exercise, a registration based on “any document presented by the Corporation” may be met with some practical challenges especially in view of the provisions of some existing land instrument registration laws. For example, section 74(1) of the Lagos State Land Registration Law (Cap L41, Laws of Lagos State 2015) provides that dealings in land shall be effected by deed and section 74(3) of the Law provides that “[a] document for which no form is provided shall be in such manner as the Registrar may approve”. If the 2021 Bill is signed into law, it would be necessary for the Corporation to launch an awareness drive directed at all institutions whose operations may be impacted by the amendment. Examples of such institutions are the land registries of all the states.

d. Tenor and Dissolution date of the Corporation

Section 61 of the AMCON Act was affected by the two previous amendments and the 2021 Bill proposes further amendments in the manner below:

  1. The amendment of the meaning of the word “tenor” as used in Part IX of the Act to mean “a period of 5 years from the expiration of the current tenor but may be extended by a resolution of the National Assembly for such further period as the Corporation may determine with the approval of the Central Bank of Nigeria”.

The 2015 amendment had defined “tenor” as a period of 10 years from 2010 which may be extended by the National Assembly for a period not exceeding 5 years. The proposed amendment suggests that the drafters envisage the possibility that the Corporation would be around for a much longer time than initially envisioned. This is not a surprise given the many AMCON claims pending at trial courts and its over N4 Trillion debt portfolio.

2. The introduction of a definition for the phrase “dissolution date” which means “a date to be determined by the Board of Directors of the Corporation with the approval of the Central Bank of Nigeria”.

This is a correction to an omission in the 2019 amendment where the phrase “dissolution date” was introduced in section 47 (which deals with the appointment of liquidators to wind up the Corporation on that date), but no definition was provided. Like the amendment to the meaning of “tenor” this new definition also indicates that the drafters of the 2021 Bill forecast a longer lifespan for the Corporation.

3. As stated earlier, the definition of “Court” has been amended to mean “the Federal High Court, the Special Tribunal for Enforcement & Recovery of Eligible Loans and other superior courts exercising appellate jurisdictions over the Federal High Court and the Special Tribunal for Enforcement & recovery of Eligible Loans”. Apart from the introduction of the Special Tribunal, the significant difference in this definition is the deletion of the High Courts of the State and the FCT which were introduced in the 2019 amendment. A strict interpretation of the 2019 definition means that AMCON recovery claims can be commenced at the High Courts of the State and the FCT and the 2021 Bill aims to reverse that deviation.

 Conclusion

The previous amendments to the AMCON Act have attracted immense reactions, both in the Courts and in public discourse. This trajectory is unlikely to change if the 2021 Bill is given presidential assent without any changes. Media reports on the third reading at the Senate indicate that there was opposition to certain aspects of the 2021 Bill by some Senators, most of whom expressed their dissatisfaction with the proposal to amend section 34 to grant the Corporation legal title to all the assets of a debtor, even where such assets were not used as security for the eligible bank asset. It will not be a surprise if that is only a prelude to what is to come.

The main goal of drafters of all amendments to the AMCON Act would appear to be the need to assist the Corporation in achieving its mandate timely and effectively. Senator Uba Sani, Chairman of the Senate Committee on Banking, Insurance and other Financial Institutions, expressed this rationale during the presentation of the 2021 Bill which he said will “provide for a quicker, easier and legitimate process of assets disposal.” However, extremely controversial amendments can create a catch-22 in that they can open a pathway for a barrage of objections. These objections can create a deviation from the Corporation’s debt recovery claim and ultimately lead to a longer time spent in the recovery process, especially as such issues would be considered as recondite points of law on appeal. The Executive should consider the need for balance while reviewing the 2021 Bill for assent.

 

 

 


Kamsi Atuchukwu is a legal practitioner based in Lagos, Nigeria.

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