Hello , How is your day coming?

As for me, I have been switching between taking care of my babies(My New baby, my older one, and of course, my husband) and coordinating my team at the office.

And it hasn't been such a bad idea.

One of the advantages of having me in your corner is that i will always be there to bring facts and valuable information that will help you navigate the legal aspect of your business more effectively.

the interesting thing about law is that it changes...a lot most times.

So, if you don't have someone looking out for your interest, you could be running with an old light when things have actually changed.

Prior to 2020, the position of the law was that you were not obligated to take up all shares of your company upon incorporating your business with CAC.

The position of the law before 2020 required business owners to take up not less than 25% of the company.

This means that you and your Co-founders could decide to share only 30% of your company shares while leaving 70% of the shares unissued and on reserve for future purposes.

also, you could still take up the whole shares if you wanted.

But if you decide not to take up all the shares, the portion of the shares you take up cannot be less than 25% of the total share capital.

This was a good law because it was in line with international best practices as far as company formation and operation were concerned.

However, In 2022, this is no longer the position of the law.

The main law that regulates the formation and operation of businesses in Nigeria( The repealed and re-enacted Companies and Allied Matters Act(CAMA) 2020) says something different.

CAMA now requires that anyone who wants to register a Limited liability Company in Nigeria must take up the entire shares of the company at the point of registration regardless of the share capital involved.

It means that even if you register a N25M share capital Company, for example, you must take up the entire 25 million shares whether or not you are a solo founder or you have partners.

It means no more reservation of shares by the Company for whatever purpose.

Whether this new position is a good law or not is a story for another day.

I might create time to share with you tips and strategies you can use to navigate the challenges that may have been created by this new requirement.

If it is urgent to you, you can also book a zoom session with me and my team and I could work with you to create a workable strategy around this.

for now, I just want to keep you abreast of what the law says.

To your #LegalSense

-Barinaada