The NBA’s Section on Business Law 10th Annual Business Law Conference with the theme “Law Reform and Economic Development.” drew the attention of several top government officials, judges, lawyers and leaders in commerce and industry.
The conference attracted some of the best authorities in corporate and commercial law practice. The resource persons were extremely qualified with intimidating credentials, and attendees would agree that it was well worth its registration fee.
The theme of the 2016 Conference, “Law Reform and Economic Development,” offered a platform for regulators, lawyers and business executives to engage in meaningful discourse on policies and regulations that shape economic growth.
In his welcome address, the Chairman of the SBL Conference Planning Committee Dr. Babatunde Ajibade, SAN, set the tone for the Conference when he asserted, “There is no gainsaying the fact that these are tough economic times for the Nigerian nation and a time when all hands must be on deck if we are to turn our economy around.” He noted that Nigeria was paying the price for relying solely on oil revenues as a source of economic development in her recent history. According to him, the fall in oil price has exposed the nation to the dangers of being solely dependent on oil and has forced Nigeria to take the issue of diversification far more seriously than at any time in the past.
This state of affairs, he said, informed the decision to choose conference sessions that focused on the key drivers of economic diversification and development. Apart from focusing on how to diversify the economy, there were sessions that also focused on reforming the necessary laws to make it easier to do business in Nigeria.
The SBL Chairman, Mr. Asue Ighodalo explained the choice of the conference theme thus: “We settled on this theme to re-emphasise that law reform begets rapid economic development, effective resource allocation, employment, attraction of appropriate investment, economic diversification and security.”
Reforming our laws and making them responsive to our current challenges and opportunities, he said, required collective effort. “Archaic, restrictive and retrogressive laws must be repealed or appropriately reviewed to ensure an enabling business environment which supports sustainable economic development.”
According to the NBA President, Augustine Alegeh, SAN, the conference could not have come at a better time than now, when Nigeria is focusing on how to resuscitate several comatose sectors of the economy.
The Nigerian Vice President, Professor Yemi Osinbajo, SAN, who delivered the keynote address and declared the conference open used the opportunity to warn that the passage of the Petroleum Industry Bill would not cure all the ills afflicting the oil sector, stating that there were more pressing problems in the oil and gas industry.
While responding to Alegeh’s concerns over the non-passage of the PIB by the National Assembly in the last 14 years, Osinbajo explained that the issues bedeviling the oil industry were not necessarily legislative ones, but the very nature and structure of the nation’s joint ventures as well as the fairness (or otherwise) of the agreements between the joint venture partners.
“What seems to be the problem for us today,” the vice-president stated, “is really more of how our joint ventures are structured, especially our cash core deficits and how to address them. However you choose to write the PIB, it must still be the case that you must find a way of resolving questions around who pays for our own portion of the joint venture. Over time, we have somehow found a way of not paying, so there is a huge backlog. But aside from that, there is a question around Production Sharing Contracts and whether those PSCs should be framed as they are. And these are not necessarily legislative issues, but rather more of issues around agreements and how they are drawn up or and whether the agreements are fair or not. For us, really, the major problems today revolve around the questions of how agreements we have entered into are wrongly entered; how those joint ventures are wrong; how those PSCs are wrong and what we need to be doing moving forward.”
The Chief Justice of Nigeria, Justice Mahmud Mohammed, represented by Justice Sylvester Ngwuta, JSC, mentioned that legal reforms must be set in motion to address the nation’s problems. He called on lawyers to act as agents of changes and be ready to fulfill their calling in helping the nation to confront many of its current challenges.
The general consensus among the conference-goers was that some of the laws under which businesses operate in Nigeria were far from conducive. Apart from being archaic, many of our laws are also active disincentives to economic growth.
During the session on “Law Reform and Economic Development,” participants agreed that there is a nexus between law reform and economic development and that Nigeria has failed to live up to expectations of its business class in terms of law reform. While countries such as Great Britain keep on amending their laws to respond to the dynamics of modern business and the evolving needs of business organisations big and small, Nigeria has retained old laws including some inherited from the colonial masters. Chaired by Mr. Fola Adeola of Fate Foundation, the session also featured presentations by Senator Oladipo Odujirin, a Senior Partner at Odujirin and Adefulu; Mr. Kefas Magaji, the acting chairman of the Nigerian Law Reform Commission; Dr. Jumoke Oduwole, the Senior Special Assistant to the President on Industry, Trade and Investment, Office of the Vice President; and Dr. Gerald Tanyi, chief counsel at the International Finance Corporation, IFC.
Senator Odujinrin identified challenges in the law-making process, including the lack of communication between the executive and the legislative arms of government, as well as a lack of consistency at the National Assembly. He suggested the establishment of a federal legislative clearing house system.
On his part, Mr. Magaji stated that the Law Reform Commission had indeed identified laws that should be amended or repealed outright, but observed that the draft laws were not getting the desired attention.
The next session, “Managing Nigeria’s Economy – Is There a Need for Institutional Reforms?” was chaired by Mr. Gbenga Oyebode, MFR, the Managing Partner of Aluko and Oyebode, and featured the Honorable Minister for Finance, Mrs. Kemi Adeosun, as well as a star-studded discussion panel which included Dr. Alex Otti, Mrs. Peju Adebanjo, Dr. Doyin Salami, Mr. Segun Ogunsanya.
Dr. Otti argued that there was an urgent need to reduce the cost of governance in Nigeria. He stated that a government of 109 senators, 306 members of the House of Representatives, 774 local government council chairmen complete with councilors, and 980 state house of assembly members (an average of 27 members per state) was not sustainable. He also addressed the issue of the Ease of Doing Business Index, which he said ranked Nigeria at No. 169 among 189 countries.
“Clearing goods at the sea ports in Nigeria takes 20 days,” Otti noted, “whereas in neighboring Benin Republic, it takes 5 days, while in Mauritius and Singapore it will take two days and one day respectively. Even more remarkably, it takes just 7 hours in Botswana.” The former Diamond Bank boss also stated that the time and cost of starting and running a business in Nigeria remains discouragingly high. He cited the recurrent problems of multiple taxation, policy inconsistency and a slow judicial process as impediments to the growth of a thriving entrepreneurial sector. When the challenge of providing security is added to the aforementioned challenges, he concluded, no one is left in doubt of the fact that despite its large population, Nigeria is not competitive when it comes to attracting business.
At a time when the Federal Government does not have enough resources to allocate to states, The Minister of Finance stated, during her presentation, that most states of the federation lacked tax space for private investors that would enable them to generate reasonable internally generated revenue (IGR), to fund these states. Mrs. Kemi Adeosun went on to describe how states could generate more funds, rather than relying on the Federal Government for bail-out funds.
While fielding questions at the end of her presentation, Adeosun also pointed out that the Federal Government was adopting a fiscal sustainability plan to resolve some of the outstanding salaries owed workers nationwide.
On the policy framework being adopted by the Buhari administration, Adeosun admitted that the government had not been as good with its communications as it should, but that it was proactive towards the diversification of the economy and its fight against corruption.
The consensus at the next session was that the Company and Allied Matters Act (CAMA) was no longer serving the needs of the business community. Chaired by Professor G.A. Olawoyin, SAN, the session was comprised of experienced professionals such as Gbolahan Elias (main speaker) and Alex Mouka (moderator). The panelists included Prof. Joseph Abugu of the Faculty of Law, University of Lagos; Mr. Bello Mahmud, the registrar-general of the Corporate Affairs Commission (CAC) and Ms Angela Omo-Dare, who is the head, Country Legal Services at Stanbic IBTC Holdings Plc.
Elias identified many redundant provisions of CAMA and suggested they be expunged forthwith. Interestingly, he received support from Mahmud, the registrar-general of the CAC, who stated that his organisation had also compiled areas that needed to be amended. According to Elias, CAMA was now nearly 30 years old, noting that in some respects, it was already dated at the time it was passed, as it was based on pre-1985 English law. “Since then,” he said, “English law has already enjoyed several sets of major reforms some of which include share buy back and financial assistance now being restricted to public companies.”
On his part, Prof. Abugu could not understand why small companies should be burdened with filing annual returns, while others who spoke on the issue stated that it would be preferable for states to also be given powers to register companies.
Hardly can any discussion about the Nigerian economy be conducted without reference to the oil and gas sector because of the role the sector plays in the development of the country. Former NBA President Olisa Agbakoba, SAN chaired the session while the Minister of State for Petroleum, Dr. Ibe Kachikwu was the chief speaker. The session was moderated by Mr. Ola Alokolaro while panellists included Mr. Ken Etim, managing partner, Banwo and Ighodalo; Mr. O.A. Avuru, chief executive officer, Seplat Petroleum Plc; Mr. Tunji Mayaki, deputy managing director, Addax Petroleum Development (Nig.) Limited; and Mr. Demola Adeyemi-Bero, managing director, First Exploration and Production Limited
In spite of the gloomy outlook for the oil and gas industry and the challenging environment under which it currently operates, Kachikwu was optimistic that the future remained bright and had rewarding prospects.
In their various contributions, participants at the session also made a case for the PIB to be passed into law to open up more opportunities in the oil and gas sector.
Thereafter, the conference discussed weaknesses in the Arbitration and Conciliation Act as a vehicle for the resolution of commercial disputes.
One of the critical sessions, which came next, was devoted to exploring ways in which Nigeria could improve its ranking in the World Bank’s Ease Of Doing Business Index – which states in no uncertain terms as things stand, the country is not at all competitive.
Without power, every developmental plan no matter, how well drafted, will fall into pieces. Power is a critical area whose less-than-satisfactory performance has crippled businesses and stifled development. The session on power titled, “When Will the Lights Come On?” addressed the sundry issues surrounding the power sector. It examined the progress made so far in the sector through various reforms introduced by successive administrations. The Kaduna State governor, Malam Nasir el Rufai chaired the session, while a former Minister for Power, Dr Lanre Babalola was the chief speaker. The session was moderated by Mr. Mohammed Mijindadi, the Managing Director of Gas Power Systems (Nig.), GE.
The session titled the “Vision for Nigeria’s Infrastructure Development –What do we Need to Get There?,” deliberated on the challenges faced by Nigeria and other developing African countries in bridging the infrastructure gap that presently existed in this part of the world. In his remarks, the honorable minister of power, works and housing, Mr. Babatunde Raji Fashola blamed the poor state of infrastructure in Nigeria on the bad choices that the country made in the past. These poor choices, according to him, manifested in the form of meagre budgetary allocations to the critical sectors of power, works and housing by past administrations as well as a non-release of funds even after budgets had been passed. The Minister observed that apart from the size of the budget, what had happened also was that 30 percent of the 2016 budget has been dedicated to capital expenditure – specifically to finance infrastructure.
Not afraid to take on critics, Fashola stated that people who asked why the country was going to borrow but at the same time asked for new roads were not being sincere. “In the context that we are not earning enough money,” he explained we must borrow to finance infrastructure, it is a sensible investment, as the amortization period is longer.”
At the end of the various sessions and the intellectual heavy lifting at the 10th SBL Conference, it was time to unwind and have fun – as only lawyers know how to. In addition to the busy sessions, the organizers managed to create opportunities for personal and professional networking among the participants. There was a cocktail party at Jabi Lake, Abuja with the theme “African Night at the Lake.” Participants were entertained at the end of the conference with a scintillating performance by Olamide, one of Nigeria’s top contemporary artistes.
For those who missed this year’s NBA-SBL conference, they will be well advised to start saving for the 2017 gathering of Nigeria’s finest legal and business minds.
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