Duty of a company to register charges in Nigeria

Duty of a company to register charges in Nigeria

October 31, 2019

Section 197 of the Companies and Allied Matters Act cap C20 Laws of the Federation of Nigeria 2004 (CAMA) states that every charge created by a company shall so far as any security on the company’s property or undertaking is conferred be void against the liquidator and any creditor of the company, unless prescribed particulars of the charge together with the instrument, if any, by which the charge is created or evidenced, have been delivered to or received by the commission for registration within ninety days after its creation but without prejudice to any contract or obligation for repayment of the money thereby secured , and when a charge becomes void based on this provision, the money secured shall immediately become payable.

It is thus the duty of the company securing its debt by a charge on its property to register it with CAC within 90 days of its creation and failure to register it makes the debt payable immediately. The requirements for filing of a notice of charge on a company’s property or undertaking includes the following:

 duly stamped and sealed deed with counterpart copy

 duly completed form for notice of charge

 Court order where applicable (section 205 of the CAMA for late filing of mortgage)

 Photocopy of previous registered deed in case of deed of upstamping

 Payment of fees

 

PLEASE NOTE:

  1. Notice of a charge shall be filed with the Commission within 90 days of the creation of the charge.
  2. In the case of mortgage, evidence of application for Governor’s consent duly submitted to the appropriate authority must be disclosed

 

 

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