December 15, 2020
KMO LEGAL NEWSLETTER – DECEMBER 2020 (VOL. 1)
AN OVERVIEW OF THE BANKS AND OTHER FINANCIAL INSTITUTIONS ACT 2020
By Akorede Folarin (Associate)
The amendment and replacement of the Banks and Other Financial Institutions Act (BOFIA) 2004, has long been touted to be the next major milestone in the country’s ambitious drive towards creating an enabling business environment in the country and improving the Nigerian investment climate.
The now repealed Act had been in operation for about 16 years without amendment, despite progressive innovations in the banking and finance sector globally and the increasing complexities as a result of disruptive technologies and their associated risks. Also, lax corporate governance under the old Act had given room for insider abuse and corruption, culminating in the humongous increase in non-performing loans (NPLs) in the country’s banking system. Additionally, the erosion of faith in the Nigerian banking system as a result of the 2004 and 2008 financial crises which can be traced to the excessive risk taking, reckless credit facilities, and other unethical practices in the system had resulted in the long and growing public clamour by stakeholders for the review of the regulatory framework for banking and finance in Nigeria.
The enactment of the Banks and Other Financial Institutions Act (BOFIA) 2020 is, therefore, intended to update the existing Act to tackle some of these debilitating challenges in the Nigerian banking and financial services industry occasioned by an Act which has proved to be grossly inadequate in the present ecosystem and to bring it in line with global best practices. The Act seeks to regulate banking and businesses of other financial institutions by prohibiting the carrying on of such businesses in Nigeria except under license and by a company incorporated in Nigeria; update laws governing Banks, Financial Institutions and Financial Services Companies; enhance efficiency in the process of obtaining/granting banking licenses; accurately delineate the regulatory functions of the Central Bank of Nigeria (“the Bank” / “CBN”) in the financial services industry; update and incorporate the laws for enacting, licensing and regulating microfinance banks; regulate the activities of financial technology companies (Fin-Techs); and update commensurate penalties for regulatory breaches in the financial services sector.
The key provisions of the new Act are highlighted as follows:
BANKING BUSINESS
Operating without License
- The Act makes it an offense for any person/body to transact banking business without a valid license issued by the CBN. The Act goes further to provide a stiff penalty of 5 years imprisonment or a fine not less than N50 million or two times the cumulative deposits or other amount collected or both imprisonment and fine for anyone who violates this provision. This we expect will serve as a deterrent to operators of Ponzi schemes who swindle naïve investors through fraudulent means. The Central Bank of Nigeria (CBN) itself has previously iterated that widespread innovation in channels for delivering financial services, emergence of new types of regulated institutions, advancements in supervisory techniques and methodologies are some of the contemporary developments that necessitate the need to upscale the legal framework for banking regulation and supervision in Nigeria.
October 15, 2020
HIGHLIGHTS ON THE EMERGENCY ECONOMIC STIMULUS BILL, 2020**
By Michael Ezeh and Latifat Moradeyo (Associates)
Although, the primary target of the COVID 19 pandemic is public health, its impact on the global economies is quite calamitous and unprecedented. Business process functions across most industries are severely deterred due to the immense pressure resulting from the effects of the Covid-19 pandemic, therefore, many multinationals, complex and business-critical services running a global scale as well as the Micro, Small and Medium Enterprises (MSMEs) must be reassessed to meet the realities of our time. Countries around the world have put in place monetary and fiscal measures to cushion the hardship of the deadly virus on businesses, individuals, and households.
In a bid to cushion the effect of the COVID- 19 pandemic, the House of Representatives on the 24th March, 2020 passed the Emergency Economic Stimulus Bill, 2020 (“the Bill”). According to Section 1 of the Bill, the objectives of the Bill are as follows:
- To provide temporary relief to companies and individuals and alleviate the adverse financial consequences of a slowdown in economic activities as a result of Covid-19;
- To protect the employment status of Nigerians who might otherwise become unemployed;
- To provide a moratorium on mortgage obligations for individuals;
- To eliminate additional fiscal bottleneck on the importation of medical equipment, medicines, personal protection equipment, etc.; and
- To cater to the general wellbeing of Nigerians pending the eradication of the pandemic and a return to economic stability.
The Bill provides for three relief which are; reduction of income tax liability of an employer, waiver of import duty on medicines and medical goods and deferral of mortgage payments to the Federal Mortgage Bank of Nigeria for a fixed term.
September 26, 2020
MEDICO-LEGAL PRACTICE IN NIGERIA: BALANCING THE RIGHTS AND LIABILITIES OF PATIENTS AND MEDICAL PRACTITIONERS. **
By Mercy Agbo (Associate)
Introduction
The COVID 19 pandemic has put the world today on a standstill. Businesses and human activities have been put on hold for the life of mankind to be preserved. It is safe to say that health practitioners especially, medical doctors are at the forefront of this battle and there is need to preserve a continuous and friendly relationship between them and patients. It is established law that doctors owe a sacrosanct medical duty of care to their patients which requires a high degree of skill and competence; otherwise, liability for medical negligence may arise. However, given certain circumstances, it is not easily determinable when negligence is said to have arisen as instanced where due to the COVID 19 pandemic, most doctors may be scared and decide not to attend to sick persons especially those who show symptoms of the virus, where a patient dies in the course of being treated or out of improper diagnosis by the doctor or hospital.
This article, therefore, tends to answer the posers: whether a medical doctor can refuse to treat a patient? Whether the patients have any right? Whether a medical doctor or a hospital can be liable for negligence? by focusing on the duties and responsibilities of medical practitioners vis a vis the rights of patients with a discuss on medical negligence, its elements and remedial actions that can be brought up in the case of a breach.
May 23, 2020
KMO LEGAL NEWSLETTER – MAY 2020 (VOL. 2)
DEBT RELIEF/FORGIVENESS: A STEP TOWARDS FINANCIAL HEALTH AMIDST COVID-19 PANDEMIC.
BY Latifat Moradeyo (Associate)
The outbreak of COVID-19 pandemic has exposed the world to an economic upheaval. Declared a pandemic by the World Health Organization (WHO) on 11 March 2020,[1] COVID-19 has become a global emergency, given its impact on the entire world population and the economy. It has no doubt resulted in closure of countries borders, shut down of businesses and self– quarantine globally.
Economic impacts of the COVID-19 pandemic became more visible in the world economy by the 20th of February, 2020 with the stock market crash.On 14 April 2020, the International Monetary Fund (IMF) reported that all G7 nations had entered or were entering into what was called “deep recession” alongside most of the western world with significant slowdown of growth across developing and emerging economies[2]. The IMF has stated that the economic decline is “far worse” than that of the Great Recession in 2009[3].
It is worthy of note that the pandemic has so far affected companies particularly on the supply and demand sides[4]. On the supply side, companies experienced a reduction in the supply of labour, as workers were unwell or needed to look after their children or other dependents and in many cases, there was outright downsizing due to paucity of income to meet such commitments.The recession has seen unusually high and rapid increase in unemployment rates in many countries. For instance, some of the world biggest airlines including Virgin Australia, Air Mauritius and four subsidiaries of Norwegian airline filed for bankruptcy. Pursuant to this, an estimated 1, 571 pilots and 3, 134 cabin crew employed by these companies and their subsidiaries stand the risk of losing their jobs.
Download full newsletter here debt relief or forgiveness …(1) as a PDF document.
March 17, 2020
WHO IS AUTHORIZED UNDER THE LAW TO COLLECT STAMP DUTIES IN NIGERIA
WHO IS AUTHORIZED UNDER THE LAW TO COLLECT STAMP DUTIES IN NIGERIA
BY FELIX TERUNGWA AYEM, LLB, BL, HRM; Associate at KMO LEGAL
The office of the Attorney General of the Federation is created by the provisions of section 150 (1) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended). The section provides clearly as follows:
“There shall be an Attorney-General of the Federation who shall be the Chief Law Officer of the Federation and a Minister of the Government of the Federation”.
The position of the Attorney-General as described above entails that he is the numero uno, that is, the number one law officer in the whole of the Federation and that automatically places him in the position of the Chief Advisor to the President on all legal issues. (more…)
March 17, 2020
GIG ECONOMY WORKERS: EMPLOYEES OR INDEPENDENT CONTRACTORS? BY Ruth Nwankwo and Chibueze Muobuikwu
GIG ECONOMY WORKERS: EMPLOYEES OR INDEPENDENT CONTRACTORS?[1]
INTRODUCTION
Gig economy is an economic activity that involves the use of temporary or freelance workers to perform jobs typically in the service sector.[2] In a gig economy, flexible jobs are commonplace and companies tend towards hiring independent contractors and freelancers instead of full-time employees.[3] In essence, it is where workers complete tasks on a project-by-project or client-by-client basis rather than regularly working for a single employer.[4] The gig economy is characterized by flexibility, zero hour contracts, self employment, workers paid for limited contracts, and people having more than one source of income.[5] Jobs in the gig economy include ridesharing [Uber, Bolt, Opay etc] which is now popular, delivery driving, selling craft, consulting, freelance writing, photography, coding and programming etc.[6] Participants in the gig economy are usually referred to as gig workers and on-demand companies. A gig worker has been defined to mean an independent contractor, online platform worker, contract firm worker, on-call worker and temporary worker.[7]
