Use the Lexology Navigator tool to compare the answers in this article with those from other jurisdictions.
Recognition of foreign proceedings
Under what circumstances will the courts in your jurisdiction recognise the validity of foreign insolvency proceedings?
Nigerian courts will seek to coordinate both local and foreign insolvency proceedings and give effect to the respective orders.
In the same vein, foreign insolvency judgments and orders may be enforced in Nigeria if they comply with Section 10 of the Foreign (Reciprocal Enforcement) Act (CAP F35, Laws of the Federation of Nigeria, 2004), which requires the existence of a wholly or partly unsatisfied foreign monetary judgment debt. This law is based on the reciprocity of treatment of similar judgments in the original country.
Winding up foreign companies
What is the extent of the courts’ powers to order the winding up of foreign companies doing business in your jurisdiction?
Foreign companies intending to carry on business in Nigeria must take all necessary steps to obtain incorporation as a separate entity in Nigeria for that purpose. Therefore, foreign companies carrying on business in Nigeria are treated the same as the local companies as long as they are registered in Nigeria, as required by the Companies and Allied Matters Act (CAP C20, Laws of the Federation of Nigeria, 2004).
The courts have the same powers with regard to winding up foreign and local companies. The court can order the compulsory winding up of foreign companies registered in Nigeria:
- where the company resolved to be wound up by special resolution;
- where the company has fewer than two members;
- where the company cannot pay its debts; or
- on just and equitable grounds as determined by the court.
Centre of main interests
How is the centre of main interests determined in your jurisdiction?
The centre of main interest is determined as the place where the company carries on its business. In most cases, this is the company’s registered address or headquarters.
What is the general approach of the courts in your jurisdiction to cooperating with foreign courts in managing cross-border insolvencies?
The courts may apply the legal or equitable rules governing the recognition of foreign insolvency orders and assist foreign representatives, as long as this is consistent with the Bankruptcy and Insolvency (Repeal and Re-enactment) Act 2016.
Click here to view the full article.