CAC change of shareholder

A shareholder is a member of a company in Nigeria, as a member, she/he is entitled to the ownership, control and management of the company.

google.com, pub-4436339061114352, DIRECT, f08c47fec0942fa0

In Any Nigerian Company, you can be an equity share holder or preference shareholder.

An equity share holders are usually entitled to major control of the company, while preference shareholders are entitled to payment of dividends before others, giving them priority over common shareholders.in the event company becomes bankrupt, preference shareholders are to be paid first before other shareholders.

Other benefits of having shares in a company, is the ability to have higher voting power, when it comes to company decisions.

At certain point in the life of a company, a shareholder might decide to resign, and what becomes of his shares with the company? and how do one change a shareholder? To change a shareholder in Nigeria, specifically through the Corporate Affairs Commission (CAC), you would need to follow these steps:

  1. Obtain the necessary documents: Gather the means of identity of the shareholder(s).
  2. Board resolution: A resolution passed by the board of directors approving the share transfer upon the receipt of notice of resignation by the outgoing shareholder.
  3. Letter of Resignation: A shareholder resigning his position, need to formally communicate to the company directors and other members of his resignation, by a notice of resignation, and his willingness to transfer his shares.
  4. Persons with significant control: A shareholder who falls under the definition of persons with significant control must fulfill the requirement, set by the commission.

“Person with significant control (PSC)” means the natural person(s) who ultimately owns or controls a company or limited liability partnership or the natural person on whose behalf a transaction is being conducted and includes those natural persons who exercise ultimate effective control over a legal person or arrangement. To qualify as a PSC, the person must meet any of the following conditions in relation to a company or limited liability partnership –

  1. Holds at least 5% of the issued shares in a company or interest in a limited liability partnership either directly or indirectly,
  2. Exercises at least 5% of the voting rights in a company or limited liability partnership directly or indirectly,
  3. Holds a right directly or indirectly, to appoint or remove a majority of the directors of the company or partners of the limited liability partnership,
  4. Exercises significant influence or control, directly or indirectly, over the company or limited liability partnership; or
  5. Having the right to exercise, or actually exercise significant influence or control over the activities of a trust or firm, whether or not it is a legal entity, would satisfy any of the first four conditions if it were an individual.
See also  How to Send Money to Nigeria from the United States

5.Contact Accredited cac Agent:The company need to reach out to an accredited cac agent, to help with online form filling, notifying the corporate affairs commission of the change, and return of allotment of shares. The cac agent may as well issue the company Form CAC 2.7 (particulars of shareholders) to fill or request share holders personal details.

6.Transfer/Re-allotment of shares :Any share holder resigning his position, need to transfer the shares to another incoming shareholder for money or any other beneficial interest. the shareholder must meet up with the requirement.

Requirement for re-allotment of shares.

  1. Means of identification for individuals  
  2. Evidence of registration for foreign company
  3. Evidence of valuation of consideration for shares issued other than for cash (applicable to public companies only)

Note: This option is available for allotment of shares to new shareholders or to allot shares to existing shareholders, for existing shares you can use Transmission|Transfer|Surrender|New Allotment process in your portal as an accredited cac agent.

it is important to know that No shares can be taken, if there is no resignation by a shareholder, or transfer/transmission of the shares he/she is holding, in any event, you can always increase your share capital to enable the company take in new shareholders.

In the case of increase in issued share capital, at least 25% of the share capital including the increase shall be paid up within six months of notice of increase in the share capital and the return should be accompanied by copies of the memorandum and articles of association.

See also  CAC REGISTRATION OF BUSINESS NAME & COMPANIES IN NIGERIA.

Directors shall, within six months of notice of increase in the issued share capital, deliver to the Commission a statutory declaration verifying the fact that 25% of the share capital including the increase has been paid up.

To start the procedure, fill out the form in the image below or contact us.

Pay the prescribed fees: The payment of the prescribed fees,will aid the application procedure,the price for change of shareholder depend on the scale of charges by the accredited cac agent,, but N10,000 is the official charge, where the company files within 14 days of such change.. Also note that the commission might insist that the company file her annual returns where it is due, before effecting the change of shareholder or re-allotment of shares.

The corporate affairs commission will issue you the company with the updated status report..

.

.

By admin

Leave a Reply