The Business Recovery Insolvency Practitioners of Nigeria (BRIPAN) on Monday commended the Chief Judge of the Federal High Court (FHC) for setting up an insolvency division in a bid to rescue troubled businesses in the country.
Speaking while on a courtesy visit to the Chief Judge of FHC, Justice John Tsoho in Abuja, the President of the Association, Chimezie Ihekweazu SAN applauded the decision of the court to set up insolvency division, noting that the initiative will save a lot of businesses in Nigeria.
He explained that the visit was to “congratulate my Lord, the Chief Judge of the Federal High Court, and also the court, on the establishment of the insolvency division.
“As insolvency professionals, we have continued to make efforts to ensure development of the practice in Nigeria. The practice of insolvency has a lot to do with business recovery and reforms that must take place in the administration of insolvency options under the enactment of the Companies and Allied Matters Act (CAMA) 2020”,
He said a few insolvency options have been added to the existing ones like the receivership management. “Presently, we now have administration of companies, conflict arrangements as well as netting, all these options have been introduced to ensure business rescue and recovery in our country, so that businesses are not allowed to just fail or be liquidated, but once insolvency sets in or becomes imminent in our jurisdiction, options are provided open to not only for the debtors, but also for creditors, as well as the regulatory institutions and those who have interest in most business outfits to explore
The administration of those options is with the aim of achieving a rescue to bring back those companies to life, with a view to dealing with their insolvency challenges and also improving on their profitability in Nigeria.
“So we are really excited as professionals that the Federal High Court has taken this initiative and has established this division, and we have today met with the Chief Judge and a number of Justices of the court to offer all necessary support and also to continue to do our best in areas of reform, particularly in the area of practice in Nigeria” he stated.
Speaking further, Ihekweaza said insolvency practitioners have been looking forward to some improvements and specialization that will aid not only the judicial processes in the court, but the administrative processes which constitutes most of the business rescue mechanisms and processes of bringing companies back to life.
“This is important in ensuring that employment is sustained and that the economy will not loss in terms of defending businesses, that even when businesses will fail, all opportunities must be exhausted within the legal framework to ensure that rescue and recovery options are fully exhausted.
“The Business Recovery and Insolvency Practitioners Association presently retains a statutory mandate under Section 705, and 707 of the Companies and Allied Matters Act 2020, and we have continued to enjoy excellent relationships with not only the court, but all the regulatory institutions, including the Corporate Affairs Commission, the Nigerian Deposit Insurance Corporation, the Asset Management Corporation of Nigeria, even the Securities and Exchange Commission” he stated.
On his part, the Chief Judge of FHC, Justice Tsoho said the court thought it wise to set up an Insolvency unit in compliance and conformity with the provisions of the Companies and Allied Matters Act.
He explained that the law required that there should be a unit that will regulate insolvency practice.
“So that is the essence of the visit, because they are excited about the practice of this Insolvency which goes into company matters like when the company has to go into receivership, the proper practice is companies that are going under should still be managed so that they don’t just die out.
“But what have prevailed in the past is that once we have a troubled company, people are more interested in rushing at the assets, and before you know it, the company has wounded up with devastating effects, losing thousands of jobs, and creating a lot of economic crisis”.
Tsoho promised to collaborate further with the Association in areas that will improve the practice of Insolvency in Nigeria.
