Startups in Ghana will now benefit from one more new investor in town.
Quick Angels Limited is a fully owned Ghanaian angel investor company which provides services, including start-up equity financing, early stage equity financing, business growth equity financing, Small and Medium Enterprises (SME) equity financing and buying and selling of businesses.
Richard Nii-Armah Quaye, Board Chairman of Quick Angels
The company promises to provide more seed capital for startups; to rapidly expand existing businesses by making available the requisite capital and premium management expertise; partner already existing businesses and startups with the aim of providing strong financial returns and creating institutionalized entities over long periods.
For those thinking that there is a new Ponzi Scheme in town, Mr. Richard Nii-Armah Quaye Board Chairman of Quick Angels said:
‘‘Quick Angels Limited has not been established to defraud people but rather, to help young entrepreneurs with brilliant business ideas to thrive.People will think that perhaps, we have also come here to bring a Ponzi scheme. Our mission is to drive innovative commercial Angel Investments that seek to propel Ghanaian start-ups and also restore promising businesses through strategic partnerships that exceed expectations.”
The best way to go about believing them is to do background checks on the company to get dig out more information about who are and their operation, although the CEO of the Ghana Investment Promotion Corporation (GIPC), Yoofi Grant has praised the new company for the initiative.
What The Company Does
“Quick Angels is a God sent company at this time where startups in Ghana need long term financial sources to grow their businesses and to scale it up. They are coming with equity funding and not loans which means that startups can comfortably think about how to scale up their businesses and grow it,’’ the Chief Executive Officer (CEO) of National Entrepreneurship and Innovation Plan in Ghana, Mr John Kumah noted.
The company stated in its website to be providing the following services:
The Startup Equity financing
Early Stage Equity Financing
Business Growth Equity Financing
SME Equity Financing
Buying and selling of Businesses
Startups in Ghana can check up on them to know what difference they are bringing to the table.
Charles Rapulu Udoh
Charles Rapulu Udoh a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
There is now the fourth board on the Nigerian Stock Exchange meant for small businesses and startups. The board, known as the Growth Board will offer startups and small businesses the opportunity to raise equities for their businesses. All the startups and the SMEs need to do is to obtain approval from the Nigerian Securities and Exchange Commission and then list their shares for public subscription.
The New Framework For Startups, SMEs
The framework for the operation of the new listing platform at the Nigerian Stock Exchange (NSE), to be known as growth board, has been approved by Nigerian apex capital market regulator, Securities and Exchange Commission (SEC).
The framework creates two segments on the growth board for start-ups, micro and small companies and medium-sized companies.
Start-ups and small companies are denoted by market capitalisation of between N50million and N500million while medium-sized enterprises are companies with market capitalisation of between N500million and N4billion.
Start-ups and small companies are expected to be listed on the first segment, known as entry segment, while medium-sized companies will be listed on the second segment, known as standard segment.
The growth board will be the fourth board at the NSE. There are three existing listing boards at the Exchange, including premium board-for large-cap companies that meet additional requirements on dedicated corporate governance assessment, main board- the general board for all companies that meet the specific stringent listing rules and alternative securities market (ASeM), which provides listing for quotable companies that cannot meet or sustain listing requirements for the main board.
Requirements For Listing
For any company to be listed on the growth board, it must be a duly incorporated public limited liability company with at least two years of operations, audited financial statements in line with the International Financial Reporting Standards (IFRS) and must have grown its revenue by a minimum of 20 per cent cumulatively in its last two years of operations.
Also, all companies to be listed on the growth board must undertake that their promoters or directors shall retain a minimum of 50 per cent of their shares for a minimum period of 12 months from date of their listing, and that the directors or promoters shall not directly or indirectly sell or offer to sell such securities during that 12-month period.
The framework meanwhile provides alternative requirements for listing for each segment.
Under the entry segment, a new business may be considered for listing if it can provide evidence of investment in it by a core investor or a strong technical partner that has a minimum of two years’ operating track record, or a majority shareholder, who is either a High Net Worth Individual (HNI) or is a director of a listed company.
Under Nigerian rules, High Net-worth Individual is an individual with net worth of more than N100 million.
Besides, companies heading for the entry segment must have market capitalization of not less than N50 million, a minimum of 10 per cent of its shares available or to be available to minority retail investors and at least 25 shareholders.
Under the standard segment, a new business may be considered for listing if it can provide evidence of a core investor or a strong technical partner who has a minimum of four years operating track record, or a majority shareholder who is a HNI.
The company must also have a minimum market capitalization of N500million, at least 15 per cent of its shares must be held or will be held by minority retail shareholders and it must have a minimum of 51 shareholders.
The NSE stated that it aims to use the growth board for greater global visibility for eligible Nigerian entities and foreign companies in order to engender global capital flows.
The new board is designed to support SMEs’ growth as part of the strategic initiatives by the stock market to enhance its traditional roles as catalyst for economic growth and development.
SMEs and start-ups account for more than 90 per cent of businesses in Nigeria and provide about 85 per cent of employment, according to various national and international data.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
International investors interested in expanding their businesses to Egypt now have more strategic reasons to do so. This is because there are now 7 additional free zones for them, making it a total of 16 free zones in Egypt, and placing the country just behind Kenya (which has over 40 free zones) and Nigeria (which has over 22 free zones).
Egypt’s President
Investors in Egypt Doing Business Within the Free Zones Get The Following Benefits:
1) No limitations in transferring profits and investing money.
2) The right to import and export without the need of recording in the Register of Importers.
3) All equipment, machinery, and transportation required for the activities thereof are exempt from customs duties and sales tax (with the exception of cars).
4) Their property and funds shall never be detained, seized, retained in protective custody, frozen or confiscated.
5) No administrative body shall interfere in pricing the companies and establishments’ products, nor in determining their profits.
6) Projects in the free zones are free from custom taxes, Sales Tax, and many other fees.
7) The projects are only subject to annual 1% fee on goods which enter or exit the Zone. However, only 3% annual fee is collected by the government where the projects are in the Service sectors, such as insurance, law, accounting. etc.
Location Of The New Free Zones
The Egyptian government has made it clear that the projects would be located in:
Minya is located South of Cairo, with over four million people. It has large electric light-making industries within the New Minya City; heavy cement factories in Sarareya and Sheikh Fadl Industrial Zones. Other sectors include Food and Beverage,Wood and Furniture, Building Materials, Chemical Industries. Small and Medium enterprises in Minya constitute 6% of the total SME landscape in Egypt, with majority of them engaged in manufacturing activities.
South Sinai
South Sinai is the least populated political division in Egypt, located in the eastern part of the country, with a population of only 104,000 people. The city has a large number of businesses engaged in Building Materials, Chinaware, Porcelain & Refractories, Food, Beverages & Tobacco, Crude oil, its refined products and Natural Gas, Production& Distribution of Electric Light & Power.
New Ismailia
Ismailia is a city in north-eastern Egypt, with a population of 366,669. Business activities in New Ismailia include: manufacturing of ready-made garments; manufacturing of leather products; manufacturing of calculating & electronic machines; manufacturing of software & information systems; manufacturing of chemicals, fertilisers & petroleum services; leasing of petroleum equipment.
Ismailia is considered one of the most suitable suitable tourism investment zones due to its distinguished location on Lake Timsah, the great bitter lakes & the Suez Canal ( considered to be the shortest shipping route between Arab and Asian countries and the West of Europe and America)
Other key locations include:
“El-Herafeyeen”in Giza
Gamasa in Dakahlia famous for a number of old and diverse industries, most important of which are: fertilizers; chemical industries; rice production
Aswan noted for tourism.
KafrEl-Sheikh, located in the northern part of Egypt and noted for cotton-processing factories, rice and fishing.
Investors In Egypt Are Already Smarter
The Egyptian government said the number of projects in the whole of Free Zones in Egypt exceeded 1095 projects, with capital amounting to $12.5 billion, in addition to $2.15 billion in direct foreign investment (FDI) and an investment cost of about $26.3 billion.These projects contributed to the provision of 194,000 jobs.
The new projects would include more than 1,000 projects, which will contribute to the provision of about 120,000 jobs, according to the Egyptian government.
Before this development, there were nine Public Free Zones in Egypt located in Alexandria (Amrya), Cairo (Nasr City), Port Said, Suez, Ismailia, Damietta, Shebeen ALKoum, Qeft, and the MediaZone City.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
From being the first successful African startup to list on the New York Stock Exchange, now to the first fraud to ever make its way to the floor of the American Stock Exchange from Africa.
It appears Jumia is in for a big trouble. Citron Research, the American research firm that publishes reports on firms that Citron Research founder, Andrew Edward Left thinks are overvalued or are engaged in fraud is saying, in a twelve-page document, that it has never seen such an obvious fraud as Jumia’s first Initial Public Offering, held from the 11th of April, 2019, in its 18 years of publishing.
‘‘ Jumia is the worst abuse of the IPO system since the Chinese RTO fraud boom almost a decade ago. Worse than being “the most expensive” US listed eCommerce company, Jumia reported financials show us a stagnant business that has burned through $1 billion and has moved the suckers game to the US Markets,’’ the report stated.
As the media in the US is naively anointing Jumia the “Amazon of Africa”, the media in its home country of Nigeria has a plethora of articles discussing the widespread fraud in this Nigerian company. Not even that elusive Nigerian prince can cover this one up.
What Went Wrong?
The deal is that Jumia lied. Not one. But so many times, said Citron. The research firm claimed it has finally laid its hands on Jumia’s most confidential documents before the IPO, and from all indications, Jumia’s equities seem to be the most worthless ever to be sold on the New York Stock Exchange.
‘‘When a company markets to investors ahead of its IPO and then a few months later omits material facts and makes material changes to its key financial metrics to make the business seem viable, this is SECURITIES FRAUD,’’ the report read.
Now These Are What The Firm Claimed To Have Found:
1. ‘‘In order to raise more money from investors, Jumia inflated its active consumers and active merchants figures’’
The inflation came by way of 20–30% increase in the number of Jumia’s active consumers and active merchants, Citron noted.
”The most disturbing disclosure that Jumia removed from its F-1 filing was that 41% of orders were returned, not delivered, or cancelled. This was previously disclosed in the Company’s October 2018 confidential investor presentation. This number is so alarming that it screams fraudulent activities,” the report noted.
”Instead, Jumia disclosed that “orders accounting for 14.4% of our Gross Merchandise Volume were either failed deliveries or returned by our consumers” in 2018. Assuming 41% of orders were returned, not delivered, or cancelled in 2018, this implies that almost 30% of orders were cancelled in 2018. Since Jumia primarily sells consumer electronics, which should not have this high of a cancellation rate, it wreaks of fraud.”
2. ‘‘Just before IPO, a Jumia MD was questioned by Nigerian Police over Allegations of Fraudulent Diversion of Funds’’
It doesn’t look like Citron is out for a joke. The firm claimed Jumia’s fraud starts from the top to the bottom.Jumia Co-CEO, Jeremy Hodara, the firm claimed, has engaged in extremely questionable related party transactions that the SEC should immediately question. It went on to provide a sequence to these questionable transactions.
In February 2016, four of Jumia’s subsidiaries were sold to Jumia’s CEO, Hodara for 1 euro each.
Despite only generating revenue of 238 thousand euro and net losses of over 3 million euro in 2017, Jumia reacquired these businesses in 2018 from Hodara for an undisclosed price.
During the same year, Jumia acquired Jumia Facilities, a payroll and support services operation based in Dubai, from Hodara for an undisclosed price.
”…many top directors of Jumia were engaging in serious acts of fraud including diverting money that was supposed to be used for projects into their own bank accounts and using director owned private companies to accept Jumia orders while receiving advance payments but never fulfilling the orders. In some cases, these fraudsters were relatives of senior management and “the directors would sweep the case under the carpet in order to avoid public scrutiny”.
Jumia’s Stocks Came Tumbling Down On The New York Stock Exchange
Now, it appears Citron Research now has laughed the last and the best laugh. Jumia’s investors are pulling out!
Jumia’s share price has dived sharply since Citron’s report.
In the seven hours of trading on Thursday, Jumia’s shares lost 18% of its value.
The Bottom Line
From all indications, it appeared Citron Research was out to disparage one country — Nigeria — and possibly block further companies there from getting approval to list on the New York Stock Exchange in the future. The firm even went as far as mentioning that Jumia learned the hard way that Nigeria, Jumia’s largest and most important market, is not an easy place to do eCommerce for plenty of reasons including logistics, poverty, and a culture of corruption. It went ahead to cite the recent divestment of Naspers(a South African company), which it described as ‘‘the smartest and largest tech investor in Africa’’ from Konga, another online eCommerce company in Nigeria.
‘‘This was not due to a lack of funds or a short-term investment horizon,[after all,] Naspers has $12 billion of cash on the balance sheet and its original investment in Tencent ([in which it] still owns >30%) dates back to 2001… Rather, this decision was a reflection of Naspers’ bearish view on the Nigerian eCommerce market vs. a bullish view on South African eCommerce. Since its Konga exit, Naspers announced plans to invest over $300 million in South African tech businesses,’’ Citron noted.
No matter how you see it, the report appeared to have gone after Nigeria rather than focus more intensely on Jumia. After all, although Nigeria is Jumia’s biggest market, its S1 filing (which Citron claims to have studied) indicates that Jumia Group is not a Nigerian company as it is led by French founders, incorporated in Germany and headquartered in Dubai.
Citron Research is sending a message to American and international investors that Jumia is not only a fraudulent company which ‘‘not even that elusive Nigerian prince’’ can deny, but also that they are throwing their money into the wrong country where it is ‘‘not easy…to do eCommerce…because of …a culture of corruption.’’ (NB: ‘Nigerian Prince’ is a reference to the notorious Nigerian internet fraudsters, popularly known as Yahoo! boys)
Whether Jumia comes out of this unscathed, only time would tell.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
The United Kingdom has expanded its visa portfolio to accommodate startup owners desiring to set up a business in the UK. The new visa regime which kicked off from March 29, 2019 is for those migrants who are looking to establish a business in the UK for the first time.
All the start-up applicant needs to have is an innovative, viable and scalable business idea, duly supported by an endorsing body. Once granted, the start-up migrant can stay in the UK for a maximum duration of 2 years.
The only downside to this is that at the end of the 2-year period (and additional extension period of 2 years), the startup immigrant cannot apply for settlement in the UK but can switch over to the Innovator Visa. The Innovator Visa will enable Innovators to stay for another 3 years, and is extendable for another 3 years, at the end of which the Innovators may apply to settle permanently in the UK.
Applicants For Startup Visa Do Not Need To Be Graduates or Have Their Startups Already Funded
This is unlike the former Tier 1 Graduate Entrepreneur visa. An applicant for a start-up visa does not need to be a graduate or secure any initial funding. All that is required is that:
The applicant has a genuine, original business plan that meets new or existing market needs and/or creates a competitive advantage (Innovation criteria);
The applicant has, or is actively developing the necessary skills, knowledge, experience and market awareness to successfully run the business.(Viability criteria);
And that there is evidence of structured planning and of potential for job creation and growth into national markets.( Scalability criteria);
For a successful start-up visa application, the applicant needs to satisfy that he/she genuinely intends to undertake and is capable of undertaking, any work or business activity in the UK stated in the application;
Moreover, the applicant must show that he/she does not intend to work in the UK in breach of the conditions of stay in the UK for a start-up migrant.
Application For The UK Startup Visa Can Be Done Both From Inside and Outside The UK
Effective from March 29, 2019, the UK visa fee for a start-up visa entry clearance and leave to remain applications will be £363 and £493, respectively. Again, the applicant may also take advantage of the Council of Europe Social Charter (CESC) discount of £55.
However, the applicant must maintain at least £945 in his account . The funds must have been held in the account for a consecutive 90 days, ending no earlier than 31 days before the date of application. The end date of the 90-day period will be taken as the date of the closing balance on the most recent document provided.
Where documents from two or more accounts are submitted, this will be the end date for the account that most favours the applicant.
If the main applicant and his/her partner or children are applying at the same time, then there must be enough maintenance funds in total, as required for all the applications, otherwise, all the applications will be refused.
Conditions for Grant of Entry and Leave to Remain
Once the startup visa has been granted, an applicant can get up to 2 years visa subject to all of the following conditions:
no employment as a doctor or dentist in training
no employment as a professional sportsperson (including as a sports coach)
registration with the police, if this is required by Part 10 of the Immigration Rules
no recourse to public funds
a migrant can study in the UK, subject to the condition set out in Part 15 of the Immigration Rules
Entry clearance or leave to remain may be curtailed as set out in paragraph 323 in Part 9 of the Immigration Rules.
entry clearance or leave to remain in the start-up category may be curtailed if an endorsing body withdraws its endorsement of a migrant or loses its status as an endorsing body for the start-up category.
Minimum Age to Apply for The Startup Visa
A start-up visa entry clearance or leave to remain applicant needs to be at least 18 years of age.
There are Twelve Requirements To Meet In order To Be Granted The Visa
If an applicant meets the requirements, then the applicant gets the start-up visa for up to 2 years.
However, if an applicant fails to meet the general and specific requirements, then the start-up visa application is refused.
Checklist of UK Startup Visa General and Specific Requirements
Evidence provided with applications
Minute age of the applicant
Immigration status in the UK
Restrictions for Tier 4 (General) Students applying in the UK
Breach of immigration laws
General grounds for refusal
Credibility assessment
English language
Maintenance funds
Applicants Must Have Secured Endorsement From Endorsing Bodies
A start-up visa applicant for entry clearance or leave to remain application needs to have an endorsement by an endorsing body listed on the gov.uk website.
Moreover, an applicant needs to provide an endorsement letter of the endorsing body.
The endorsement letter needs to confirm that the applicant’s business venture meets the innovation, viability and scalability criteria. The endorsement letter also needs to state that the endorsing body is reasonably satisfied that the applicant will spend the majority of his/her working time in the UK on developing business ventures.
English language Requirement For The UK Startup Visa
The start-up visa applicant is required to have a CEFR B2 level of English language ability. To this effect, the applicant needs to provide one of the following evidence to prove the English language requirement:
A national of a majority English speaking country
A degree taught in English — applicant needs to provide UK NARIC certificate confirming the qualification meets or exceeds the recognised standard of a Bachelor’s degree in the UK
Applicant passing a Secure English Language Test
The applicant met the requirement in a previous successful application for:
Tier 1 (Entrepreneur) under the rules in place before 13 December 2012
Tier 4 (General), supported by a Confirmation of Acceptance for Studies (CAS) assigned on or after 21 April 2011
Requirements for Start-up Visa UK Endorsing Bodies
To qualify as an endorsing body for the start-up visa, an organisation needs to meet all of the following requirements:
The organisation should either be a UK higher education institution or have a proven track record of supporting UK entrepreneurs
Ability to competently assess applicants’ business ventures against the endorsement criteria
The endorsing body to stay in contact with applicants at 6, 12 and 24 months checkpoints. And also update the Home Office on an applicant’s progress. If necessary, then even withdraws the endorsement.
No past or present involvement or connection with the abuse of the immigration system
The Bottom Line
As the UK gears up for Brexit, the new startup visa policy is one way of opening up its economy. Only the first, risk-taking startup owners may be able to take up the challenge and expand their businesses beyond their current borders, before the system becomes congested and the country considers the review of the visa policy.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
Ethiopian authorities are resorting to more taxation to boost the country’s revenue, new report by the African Development Bank says. AfDB says in its findings that revenue collection in Ethiopia has increased significantly after the government implemented tax reforms.
Key Findings From The Report
The study found that the introduction of electronic cash registers in Ethiopia increased value added tax (VAT) collections and payments by about 32%. This increase can be considered large, the bank said.
However, given the lack of capacity by many Ethiopians to pay tax, government is looking beyond the current reforms to third-party information on taxpayers, promoting electronic tax filing and payment systems, and enhancing analytical capacity using comprehensive national databases.
Another study however revealed that the threat of companies and businesses being audited by the government of Ethiopia could increase tax payments by 38%, while moral persuasion could increase collections by 32%.
The findings are merely presenting alternative ways to increase taxation on businesses in Ethiopia.
The Role of The African Development Bank In This Regard
In this regard, the Bank conducted original research to evaluate the impact of major tax policy reforms in Ethiopia, in collaboration with the Ethiopian Development Research Institute (EDRI) and the Ministry of Revenue and the Ethiopian Customs Commission (formerly Ethiopian Revenue and Customs Authority).
The African Development Bank said it would provide technical assistance to support the authorities in implementing the research findings.
The assistance will complement ongoing advisory services to support reforms, notably to the Public-Private Partnerships Framework and the logistics sector.
Additional assistance is being designed to advance financial sector development, industrial policy and strategy development, and the mining and petroleum sectors.
Beyond implementing the emerging policy recommendations, the Ethiopian government and the African Development Bank pledged to explore additional areas for impactful policy research on domestic revenue mobilization, in line with the mutual commitment to improving the quality of life of the people of Ethiopia.
The findings were revealed at a workshop hosted by the African Development Bank and a high-level delegation from the Ethiopian government. The workshop formed part of the Bank’s commitment to helping the government fund its ambitious development plans.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
More South African businessmen are headed for London, Lagos and Mauritius than you think. Flight Centre Business Travel (FCBT) has revealed in its recent data that the fastest growing international business destinations for South African travellers in 2018 were London, Lagos and Mauritius.
Here Is A Breakdown of How The Business Travels Happened
London, UK
London witnessed a growth of 47% in the number of business travellers in 2018, according to the data.
“Year after year, the city of London remains at the top of South African lists for both business and leisure travellers. The city of London itself is also enjoying rapid growth with independent studies continually ranking it above rivals such as New York and Hong Kong. It is one of the world’s leading finance centres and offers a huge variety of business venues and conference centres.”said Andrew Grunewald, FCBT team leader. 2018 was no different despite the threat of Brexit, he said.
Lagos, Nigeria
Lagos witnessed a growth of 35% in 2018.
‘‘With more South African companies seeking to exploit opportunities north of our borders, it is not surprising to see Lagos place as the second fastest growing business destination for South African travellers. This African city is the main financial, economic and commercial centre of the Nigeria. Lagos accounts for over 60% of industrial and commercial activities in the nation and is a financially viable city,’’ said Grunewald.
‘‘The fact that Mauritius with its attractive tax regime and stable economy is the third fastest growing business destination comes hardly as a surprise. The country ranked as the highest economy in Sub-Saharan Africa on the World Bank’s ‘Ease of Doing. Business’ Index and the country’s banks have become beacons of growth and stability in sub-Saharan Africa,’’Grunewald said.
Harare, Zimbabwe
Traffic to Harare from South Africa increased by 24% according to the data. Grunewald explains that the latest EY Africa Attractiveness report 2018 shows that Zimbabwe is the second most popular foreign investment destination in Southern Africa.
Dubai, United Arab Emirates
Traffic to Dubai from South Africa also increased by 17% according to the data.
The city’s regular summits, conferences and expos bring together business leaders from around the globe, Flight Centre said.
Within South Africa
Within South Africa, FCBT reported that although Johannesburg, Cape Town and Durban continue to be the most popular air travel routes, the three fastest growing domestic airports in 2018 were in fact George (with a 70% growth year on year), followed by Kimberley (36%) and Lanseria (31%).
The phenomenal growth George experienced in 2018 as a business destination might come as a surprise, but this Garden Route town was in fact hailed as one of the Western Cape cities offering the highest quality of life, beating Cape Town.
“George has become increasingly popular as a business and investment destination thanks to its ideal location and low crime rate,” said Grunewald.
The Northern Cape and Kimberley remain an important business destination thanks to its mining and agriculture sectors. The area is also growing as a result of its renewable energy initiatives with a great number of solar plants developed over the past few years.
Kimberley Airport and Upington International Airport were voted in 2019 as the best airports in Africa by size and region, in the under 2 million passengers category.
Lanseria is steadily gaining ground as the third fastest growing domestic airport, Flight Centre said. This growth is not likely to slow down as the airport has announced it is aiming to double its passenger numbers to more than 4 million within the next six years.
Charles Rapulu Udoh
Charles Rapulu Udoh a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
Barring any last minutes changes, loan guarantors in Kenya may soon be hard to be dragged to court. This is because Kenyan National Assembly’s Committee on Justice and Legal Affairs has approved, for passage into law, the Kenyan Law of Contract (Amendment) Bill, 2019. The Bill proposes that in case of a default to repay loan by the principal borrower, the creditor should first auction the assets of the principal borrower before making for the property of guarantors.
A Breakdown of The Bill:
The law will only apply to cases that take place after the Bill becomes law, while the status quo shall remain for current cases.
The Bill seeks to amend Law of Contract Act, Cap 23 of Kenya.
The new position also provides that no suit shall be brought against a guarantor of any debt or promise unless the agreement is in writing and signed by the guarantor.
The move may not be unconnected with the decision of the Kenyan high court last year which allowed banks and other financial service providers to blacklist guarantors with Credit Reference Bureaus (CRB) in case of bad loans.
The ruling was made in a case where one Obadiah Gitonga had sued Cooperative Bank for blacklisting him over a defaulted loan where he was the guarantor. Mr Gitonga demanded to be delisted from CRB, a request the court denied saying that the bank acted within the precincts of the law.
Charles Rapulu Udoh
Charles Rapulu Udoh a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
Owners of businesses in the Nigerian creative industry now have access to loans as high as ₦500,000,000 (about $1.4 million). This is according to Nigeria’s Central Bank’s recent disclosure.
The Creative Industries That Are Covered:
According to the CBN, which is collaborating with the body of top officers of deposit banks in Nigeria (the Banker’s Committee), the Creative Industry Financing Initiative is targeted at:
Businesses in the fashion (including designing) industry
Businesses in the Information Technology (including e-commerce, online payment solutions, software engineering etc.)
Businesses in the Nigerian movie industry (including movie producers, movie distributors)
Business in the Nigerian music industry (whether as record labels, music artistes, etc.)
Maximum Amounts Each of These Businesses May Get
The businesses may get up to the following amount:
A student of Software Engineering anywhere in Nigeria may get up to ₦3 million ($ 8,294)to boost his education.
Movie Production businesses may get a maximum of ₦30 million ($82,943) to boost their businesses.
Movie distribution businesses may get up to ₦500 million ( $1.4 million)
Businesses in the Nigerian Fashion and Information Technology can also get funds to cover their rental/service fees (the exact amounts were not specified)
Music Businesses may also get funds to cover their training fees, equipment fees, and rental/service fees.(The exact amount is however not specified. It also appears that the funds are not extended to businesses of production of music, and other related music roles)
Interest Rate and Dates of Repayment
The new Initiative pegs on any of the amount borrowed, the interest rate of 9 percent per year, including all charges. This is below the national lending rate of 13.5%, meaning that businesses that accessed loans through the Creative Industry Financing Initiative would be 4.3% more profitable than would be the case if they go through Nigerian commercial banks.
The Repayment Schedule for Each of the Loaned Amounts Include:
Loan under each category would be due for repayment as follows:
For Software Engineering Student Loan, it is a maximum of three years (This could be criticized because Nigerian school system runs for a full four-year academic calendar period, and the time may be too short to begin to reap the benefits of such loans, even if a lesser program is subscribed for).
For Movie Production and Distribution, it is a maximum of ten years.
For Fashion, Information Technology (IT) and Music, it is a maximum of ten year
Normal lending period can be as long as 36 months (three years) or more, depending on the loan agreement.
How To Procure The Loan
The Central Bank of Nigeria’s disclosure hints that any business in any of these categories desiring to procure the loan would need to do the following:
Prepare its business plan or statement on how much is needed for the business. However, it would also be noted that feasibility reports of the intended projects may be required.
Proceed to any commercial bank or the applicable financial institutions to access the fund. Hence, all commercial banks in Nigeria are expected to be part of the program.
In an application to the bank, state how much is needed to fund the business. The application should be made pursuant to the CBN Creative Industry Financing Initiative.
The commercial bank will discuss the request and provide the business owner the money.
What Would Be Needed To Discuss The Request Further?
The circular is however silent about whether collateral is needed for the loan. Banks are however expected to be tough to some degree since they bear the risk of bad loan performance. So, businesses should expect to pass through some tough risk management procedures to be able to access the loans.
Most Nigerian banks require, on minimum, the following documents in order to be able to process the loan application: Application letter; Duly completed Retail Loan Application Form; Proforma Invoice from the banks’ approved vendors; Business Profile; Current utility bill; Latest Audited Account; Six (6) Months Bank Statement; Other KYC requirements for opening a corporate or business account.
It could be noted however that the loans may be targeted at existing and profitable businesses, with good balance sheets, and not new businesses with no financial track records, except in exceptional circumstances.
Why Focus Is On the Creative Industry
The CBN appears to have focused on the creative industry for the following strategic reasons:
The film industry sector contributed 2.3 per cent (N239 billion) of Nigeria’s Gross Domestic Product (GDP) in 2016 alone.
In the same year, Nigeria’s music industry grew by 9 per cent to reach a value of 39 million dollars, and is set to grow by 13.4 per cent CAGR by 2021, with an estimated worth of about 73 million dollars.
Information Technology: The gaming industry in Nigeria, according to a PwC study on gaming, benefited from a broadening customer base, mostly the large and youthful population, with the Nigeria’s video game industry’s value put at $150 million USD as at 2016. It is also estimated that mobile gaming in Nigeria would surpass $147 million USD by 2020
This writer advises that you check out your local banker in Nigeria for more information on how to access the loan.
Charles Rapulu Udoh
Charles Rapulu Udoh a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
Previously, mergers, acquisitions and other forms of business combination in Nigeria have always been the exclusive reserve of the Securities and Exchange Commission. In a statement jointly signed by both commissions, the new positions are that:
The Federal Competition and Consumer Protection Act now has the exclusive right to authorize, with or without conditions, prohibit or approve mergers of which notice is received, in compliance with its mandates under the Federal Competition and Consumer Protection Act (FCCPA).
Forms of business combinations contemplated under the Act include the purchase or lease of stocks or interests of another company or business entity; business combination between two companies or entities ; any form of joint venture between two or more business entities.
The FCCPC (old Consumer Protection Council in Nigeria, before it was disbanded by the new law) is to review all mergers and other business combinations or arrangements to ensure that such combinations do not distort or impede the markets or create a monopoly.
Now that the Federal Competition and Consumer Protection Act has come into effect, approval for mergers or other forms of business combination will only be filed with the Securities and Exchange where the mergers and acquisitions involve a public company or where the transactions involve a change of shareholding of capital market operators, even if the transaction is between a private company on the one hand and a public company on the other.
Thus, where the notice of approval of merger is from a public company, Nigerian Securities and Exchange Commission, now, only comes in to determine whether all shareholders are fairly, equitably and similarly treated and given sufficient information regarding the merger. This in fulfillment of its mandate under the Nigerian Securities and Investment Commission.
Backlog of Pending Mergers and Acquisitions Notices in Nigeria
The statement however states that all notifications pending before SEC at the time of enactment of the FCCPA will be subject to the interim process above and FCCPC will convey the decisions accordingly. Consequently, SEC and FCCPC will jointly review such notifications and FCCPC will convey decisions with respect to the notifications.
Subsequent notices would be filed with the FCCPC.
The statement read in part:
In order to ensure continuing and seamless commercial transactions and market operations, SEC and FCCPC have come to a mutual understanding with respect to these transactions within the transition period, which pursuant to this notice commences immediately, and shall remain in force until otherwise discontinued by further Advisory or Guidance. During this transition period, starting today, May 3rd, 2019:
Where and How To File New Notices
According to the statement, notifications of mergers or acquisitions or any form of business combinations would now will be filed at;
Charles Rapulu Udoh a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.
