Court strikes out suit challenging powers of Financial Reporting Council

The Federal High Court, Lagos on Monday, October 17, 2016 struck out the suit challenging the powers of the Financial Reporting Council of Nigeria.

The suit was challenging the powers of the council to issue a National Code of Corporate Governance for the public, private and Not-for-Profit Sectors.

By an Originating Summons dated May 11, 2015 the Plaintiffs who are individual shareholders of several companies instituted an action against the Honourable Minister of Trade and Investment, the Financial Reporting Council of Nigeria, the Attorney General of the Federation and the Steerling Committee on the National code of Corporate Governance.

They prayed the Court for amongst other reliefs, a declaration that it is beyond the powers of the Financial Reporting Council of Nigeria to promulgate or issue the National Code of Corporate Governance, because it did not fall within the power conferred on it by the Financial Reporting Council of Nigeria Act, 2011.

In response to the Plaintiffs’ suit, Counsel to Financial Reporting Council of Nigeria, Professor Fabian Ajogwu SAN filed an Objection challenging the jurisdiction of the Court to entertain the suit on the ground, amongst others, that the Plaintiffs do not have the legal standing to institute the suit.

In delivering its Ruling, the Court agreed with the submissions of the learned Senior Advocate and held that the Plaintiffs are not within the purview of Public Interest Entities, Public Companies or Private Companiesas recognized under the Financial Reporting Council of Nigeria Act and the Draft/Proposed National Code of Corporate Governance.

The Court thereafter struck out the Plaintiffs’ suit.

The implication of this is that the coast is now clear for the Financial Reporting Council of Nigeria to release the National code of Corporate Governance for the public, private and Not-for-Profit Sectors.