Commercial and Corporate Law
What it is: Insolvency and bankruptcy law addresses the position of debtors who cannot pay their debts. For individuals, bankruptcy is governed by the Bankruptcy Act, while corporate insolvency, including administration, receivership, company voluntary arrangements and winding up, is governed by the Companies and Allied Matters Act 2020. Distressed financial assets may also involve the Asset Management Corporation of Nigeria, known as AMCON. There is no direct Nigerian equivalent of a United States Chapter 7 liquidation; the nearest concepts are personal bankruptcy and corporate winding up. When it applies: This service applies when an individual or company cannot meet its debts, faces a winding-up petition or bankruptcy proceedings, needs to restructure liabilities, or when a creditor wishes to recover a debt through insolvency proceedings. How a lawyer helps: An insolvency lawyer assesses the debtor's or creditor's position, advises on options such as rescue, restructuring, administration or winding up, and represents parties in proceedings. Counsel also advises directors on their duties and potential personal liability. First steps: Compile a full picture of debts, assets and creditors, avoid preferential dealings, and consult a lawyer early to explore rescue options before formal insolvency becomes unavoidable. Timely advice can preserve value, protect directors from personal exposure, and open restructuring routes that are no longer available once formal proceedings begin.
