Alliance Law Firm Moves Court Of Appeal To Affirm Sec’s Oversight Powers Over The Board And Management Of Public Companies In Nigeria
Alliance Law Firm has successfully moved the Court of Appeal of Nigeria to affirm the powers of Securities And Exchange Commission (SEC) to oversight the operations of public companies in Nigeria. In a landmark judgment delivered on 31st January, 2019, the appellate court constituted by three man panel unanimously reversed the ruling of the Federal High Court, presided over by Hon. Justice I. Idris which had earlier set aside its interim orders in favour of the Commission. In the recent case of SECURITIES AND EXCHANGE COMMISSION V. BIG TREAT PLC, CA/L/88/2011, the appellate court in the Judgment delivered by JOSEPH SHAGBAOR IKYEGH, J.C.A held at page 23 as follows:
“having registered with the appellant as dealer in securities or issuer of securities in the capital market ,the 1st respondent ‘s specific role of issuer of securities in the capital market makes the 1st respondent subject to the rules and the authority of the appellant under the I.S.A which is entitled by Section 13(v) of the I.S.A, in particular ,to intervene in the management and control of capital market operators in distress or which the appellant considers has failed ,is failing or in crisis by doing whatsoever the appellant deems necessary to arrest the drift for the protection of investors in the capital market.
The Court of went further to hold that-
“In conclusion, I most respectfully hold that the court below should not have vacated the interim preservative orders made by it to protect the imminent collapse of the 1st Respondent but the Appellant who at all material times was exercising statutory powers under the ISA to stem the tide of decay in the internal management of the 1st Respondent…”
Mr. Uche Val. Obi SAN, Managing Partner of Alliance Law Firm who doggedly prosecuted this appeal on behalf of SEC had described the judgment as a judicial clarification and affirmation of the provisions of ISA, 2007, particularly S. 13(v), which statutorily empowers SEC as the apex regulator of the Nigerian capital market, to guarantee the protection of investors, maintain a fair, efficient and transparent market in Nigeria; describing the powers granted to the Commission under its enabling Act as comparable to that exercisable by the Central Bank of Nigeria, under the Banks and Other Financial Institutions Act, under which the CBN could to dissolve and replace boards of earring banks in Nigeria.
This landmark judgment which represents the current position of the law on the subject matter has been widely reported in both local and international media.
Alliance Law Firm represented SEC at both the lower and appellate Courts.
Fred Obiejesi, Senior Associate, Alliance Law Firm