The senate on Tuesday passed a bill to repeal and re-enact companies and allied matters act.
The 8th senate under the leadership of Bukola Saraki passed the bill after the initial legislation was first enacted 28 years ago.
The bill will provide significant benefits to companies by reducing red tape and making it easier to comply with regulatory
The provisions of the bill will encourage investments that will allow small businesses and startups thrive, lower costs and ease regulatory burdens.
The bill provides for private companies to able to incorporate easily and this would help such organisations save in professional fees aiding substantial improvements to the ease of doing business in Nigeria.
The incorporation process is less stringent and formal compared to a limited liability company.
Apart from spurring the establishment of new businesses, the bill seeks to encourage
young people with innovative start-ups the opportunity to operate as legal entities without the loss of their personal assets.
Small companies will no longer be required to have a company secretary to hold Annual General Meetings (AGMs).
The legislation has also removed the requirement of the statutory declaration of compliance.
The minimum share capital required for companies to be registered has also been reduced to encourage more investments in small companies.
With this piece of legislation, companies can now reach compromises on its debts and businesses will keep running under the supervision of an administrator for a period of 12 months.