Nigerian Law Forum
This article explains how non-profit organizations like churches can register as incorporated trustees in Nigeria. Not all legal corporations or organizations are business oriented and exist to make profits. Some non-profit-oriented organizations exist to serve public purposes instead of personal interests or gains. Such organizations are usually classified and registered as companies limited by guarantee or as incorporated trustees.
Incorporated Trustees are non-business or non-profit organizations formed by a community of persons or an association. A community of persons are people bound by similar custom, religion, kinship, or nationality while an association is any organization established for any religious, educational, literary, scientific, social, development, cultural, sporting, or charitable purpose1.
The organization appoints two or more persons as trustees who hold and administers the organization's property in trust on behalf of the organization. The organization is usually registered upon the authorization of its members. Where registration is done, it is not the organization that becomes a corporate body, but the appointed trustees of the organization.
Non-profit organizations or non-governmental organizations like charities, foundations, research institutes, etc. which seek to serve a social, political, or humanitarian cause focus their activities on improving the welfare of a selected group, based on the specific group targeted by the organization. Since non-profit organizations or non-governmental organizations are formed for humanitarian or charitable purposes, they qualify to be registered as incorporated trustees.
Corporate Affairs Commission (CAC) is the regulatory body responsible for registering Incorporated Trustees. CAC is empowered by the Companies and Allied Matters ACT 2020.
Any organization seeking to be registered as Incorporated Trustee will apply to the Corporate Affairs Commission (CAC).2 The Commission prescribes-
This advertisement in the newspaper aims to create public awareness and invite objections to the registration of the association/organization by members of the public. Any objection to the registration of the association/organization must be made within 28 days of the date of the last publication in the newspaper. Where there is an objection made and information provided to that effect, the Commission has the right to accept or reject the objection after considering all the information. Where there is no objection or the Commission rejects the objection, the Commission shall approve the application, register the trustees as a corporate body and issue a certificate in the prescribed form.
Who is responsible for the newspaper publication during the registration process of incorporated trustees?
The responsibility to publish the application in the newspapers rests with the intending trustees or the applicant(s). However, the Registrar-General of the Corporate Affairs Commission, Alhaji Garba Abubakar has stated CAC’s intention to take over the newspaper publication in order to promote transparency in the registration process.3
When an organization is registered as an incorporated trustee, it becomes a corporate body with its own legal identity and right and shall have:
Not everyone is qualified to be appointed as a trustee of a non-profit organization. Anyone who falls within the category listed below is disqualified from being appointed:
Foreigners are not prevented from becoming trustees as CAMA makes no provision that limits trusteeship to only Nigerians. The categories of people prevented from being appointed as trustees are those disqualified in line with the provisions of CAMA as listed above.
However, Incorporated Trustee falls under the category of corporate organizations and any foreign participation must be in line with the regulatory requirements necessary for a successful application and registration. In line with The Nigeria Immigration Service, a foreigner who seeks to be incorporated as a trustee in Nigeria must:
The registration of non-business or non-profit organizations like charity foundations, churches, clubs, etc. as incorporated trustees is not compulsory. However, registration renders legal benefits to such organizations, gives the organization public credibility, and aids the smooth operation of its aims and objectives.
1 Section 823(1) Companies and Allied Matters Act 2020
2 Section 825 Companies and Allied Matters Act 2020
3 Section 830 Companies and Allied Matters Act 2020
4 Section 826 Companies and Allied Matters Act 2020
Preye Ezonfade , LLB
The concept of starting a business is an idea that many people like. While some go all out by investing …