The procedure for dissolving or closing down an Incorporated Trustee or Non-profit organization in Nigeria is outlined under Section 850 of the Companies and Allied Matters Act 2020 (CAMA). Organizations falling under this category include Churches, Non-governmental organizations, Foundations, and Associations.
Here is a detailed breakdown of the process:
- Petition for Dissolution:
A petition can be submitted to the court for the dissolution of the organization by any of the following:
– One or more trustees.
– Members of the association representing at least 50% of the total membership.
– The Commission.
- Grounds for Dissolution:
The court may dissolve the organization based on any of the following reasons:
– The aims and objectives for which it was established have been fully achieved, and keeping the corporation active serves no useful purpose.
– The organization was established for a specified period, which has expired, and there is no need for it to continue.
– The aims and objectives of the association have become illegal or contrary to public policy.
– It is just and equitable in all circumstances for the body corporate to be dissolved.
– The certificate of registration of the association has been withdrawn, cancelled, or revoked by the Commission.
- Hearing of the Petition:
During the hearing, all individuals whose interests or rights may be affected by the dissolution will be notified.
- Disposition of Remaining Property:
If, after settling all debts and liabilities, any property remains, it shall not be distributed among the members of the association. Instead, it should be given or transferred to another institution with similar objectives. The specific institution will be determined by the members of the association at or before the time of dissolution.
- Alternative Transfer:
If the provisions of the above clause cannot be fulfilled, the remaining property shall be transferred to a charitable cause.
This article provides a general overview of the subject. Please contact us directly for any specific legal assistance.