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B N W: Biafra Nigeria World News |
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Reps reject bill on unclaimed dividend trust fund
ATTEMPTS by the Securities and Exchange Commission (SEC), the apex regulatory authority of the capital market, and some stakeholders to establish an Unclaimed Dividend Trust Fund (UDTF) might have been stalled by the House of Representatives.
A bill sponsored by some stakeholders in the capital market, which appeared on the order paper of the lower house on Tuesday was set aside because members of the House's capital market committee considered such trust fund unnecessary.
Chairman, House of Representatives Committee on Capital Market, Alhaji Aliyu Wadada said in a telephone interview with The Guardian yesterday that the House was not aware of the first reading of the bill.
He said: "We are not aware of any unclaimed dividend trust fund. It appeared on our order paper today, and we were surprised to see it.
"It came for second reading today (Tuesday). I wonder why any trust fund should be established for unclaimed dividend. It did not pass through the first reading. There is no need for it, it is shareholders' money and the law is clear on it. When it is statute barred after 12 years, it should be ploughed back to the companies.
"There is no need for any unclaimed dividend trust fund to manage people's money for them."
On the proposed N110 billion Federal Government bond, Wadada said: "It has not come back. It was part of the 2004 appropriation proposal and we turned it down. It has not come back".
Shareholders at different fora have persistently kicked against the establishment of the trust fund, noting that it was not necessary. They had urged the board of directors of quoted companies not to release their funds for that purpose.
Instead, they said such unclaimed dividends should be ploughed back to the companies to enhance their performance and boost returns to shareholders.
The Unclaimed Dividend Trust Fund is being planned as pool for all public companies unclaimed dividend. It would be managed by a separate body to enable owners get access to them whenever they are ready to do so, but with interest payable on it.
While opposing the establishment of the fund at the yearly general meeting of a public company recently, a shareholder, Chief Sunny Nwosu said: "The Law allows companies to keep dividend after 12 years.
The constitution of the country said nobody should take what does not belong to him or her.
"Government takes 10 percent of dividend today, but it is not constitutional. We are saying categorically that you should not release our money to anybody."
Another shareholder, Dr. Farouk Umar of Association for the Advancement of the Rights of Nigerian Shareholders (AARNS) also said the trust fund was unnecessary.
He also stressed that the law does not allow people or organisations to take what does not belong to them.
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