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Taxation of Non- Resident Company | Theophilus Olufemi

by Legalnaija | Jan 17, 2018 | Uncategorized

Introduction

Section 105 (1) of CITA 2004 defines a Nigerian company as “any company or corporation (other than corporation sole) established by or under any law in force in Nigeria or elsewhere” while a non-residence company is “any company or corporation (other than a corporation sole) established by or under any law in force in any territory or country outside Nigeria. For income tax purposes, a person may be resident, non-resident or possesses dual residence.

The concept of residence determines the extent to which the income of a taxpayer is liable to tax under a tax jurisdiction. In Nigeria, a resident company is assessable on the global income. The profit of a Nigerian company is deemed to accrue in Nigeria regardless of the jurisdiction from which it is earned. In other words, a Nigerian company is assessed to tax on its global profits. On the other hand, in the case of a non-resident company, only the profit that is deemed to be derived from Nigeria is assessable to tax in Nigeria. Profits from any trade or business are deemed to be derived from Nigeria to the extent that the profits are attributable to that part of the company’s operations in Nigeria.

Profit/Income “deemed to be derived from Nigeria

To ascertain if a profit/income of a company is deemed to be derived from Nigeria, the following are the important questions that must be answered:

Does the Company have a “fixed base” in Nigeria?

Where anon-resident company has a “fixed base” from which it carries on its business or trade in Nigeria, the profits from such activities would be deemed to be derived from Nigeria. The CITA has failed to define fixed base but an FIRS circular, which is not binding, has explained it to include:

a) facilities such as a factory, an office, a branch, a mine, oil and gas;

b) where there is a controlling interest in the Nigerian company;

c) activities such as building, construction, assembly, or installation; and

d) furnishing of services in connection with the activities mentioned above

On the contrary, the CITA states that the following do not constitute a fixed base:

a) facilities used solely for storage or display of goods or merchandise; and

b) facilities used solely for the collection of information

Does the Corporation operate in Nigeria through a dependent agent authorized to conclude contracts or deliver goods or merchandise on its behalf?

A non-resident company can have two types of agents in Nigeria – an independent agent or a dependent agent. An agent is regarded as possessing independent status when he acts on behalf of a non-resident company in the ordinary course of his business. The status may however change if he devotes his activities wholly or almost wholly on behalf of the company.

Is the corporation executing a turnkey project in Nigeria?

A turnkey project is defined as a ”single contract involving survey, deliveries, installation or construction.” The profit on a turnkey project is liable to tax in Nigeria. Such a profit would not be split between the so-called “Nigeria source” and “off-shore” profits but taxed wholly in Nigeria.

Is the operation between the corporation and its Nigerian subsidiary at arm’s length?

The Law allows the Board to make appropriate adjustment to the profits of Nigerian companies where the following circumstances prevail:

a) the presence of a control of a Nigerian company may be exercised directly or indirectly by a parent company or any other company associated to it;

b) the imposition of conditions in the financial and commercial relationship by the controlling interest;

c) the conditions imposed must be different from what would obtain between independent parties or in an open market situation;

d) such relationship and conditions lead to the transfer of goods and services at prices not at arm’s length; and

e) Consequently, the profits declared for the Nigerian tax are understated.

The ‘imposition of conditions’ or control and influence as mentioned above can move in various appearances like over-invoice of goods and services, packaging of the terms of payment of interest on loans, frivolous charges for management fees, royalty, patent and rent, convenient shifting of profits between companies or in the allocation of expenses, all with the objective of minimizing, avoiding or evading the Nigerian tax.

When the conditions analysed above hold, the profit deemed to be derived from Nigeria shall be as determined by the Board. In such circumstance, the Board will carry out comparative cost and price to establish the true market prices and make necessary adjustments to determine the true profit for tax purposes.

Decided Court Case

Considering the case between: JGC Corporation and Federal Inland Revenue Service. The appellant, JGC Corporation filed an appeal before the Tax Appeal Tribunal (Lagos Zone) on April 17, 2014.

Subject of the case:

a) Whether the Appellant has a fixed base and therefore is liable to pay tax in Nigeria.

b) Whether the Appellant can be assessed to tax under Section 30(1) of Companies Income Tax Act?

The Appellant filed its Appeal sequel to the Respondent’s Notices of Refusal to Amend the Assessment of company income tax for the years ending 31st December 2004, 31st December 2005, 31st December 2006, 31st December 2007 and 31st December 2008.The Appellant seeks the following orders:

a) declaration that the issuance of the Notices of Refusal to Amend/Revised Assessments numbered R/ A 001, R/ A 002, R/ A 003, R/ A 004 and R/ A 005, all dated 23rd August 2012 by the Respondent is contrary to law and wrongful.

b) a declaration that the Appellant has fully discharged its tax obligations to the Respondent and is therefore not liable to pay the cumulative sum assessed in the Notice of Refusal to Amend/Revised Assessments or any other sum at all.

c) An order setting aside the Notice of Refusal to Amend/Revised Assessment and the assessments of tax contained in them.

d) An order of perpetual injunction restraining the Respondent from issuing any Notice or Notices of Assessment to the Appellant in respect of income and/or earnings forming the subject of the Notices of Refusal to Amend/Revised Assessments.

e) And such other orders as the Honourable Tribunal may see fit to make upon the hearing of this appeal.

The Respondent contended that the Notices of Additional/Revised Assessments were valid because: The Appellant did business in, and derived income from Nigeria. The contract for engineering, procurement, constructing transporting, installing and commissioning of facility on the worksite, was awarded in Nigeria. The worksite was in Bonny Nigeria, payment was by a Nigerian company, fabrication was to be installed in Nigeria, contract could not have been wholly performed outside Nigeria, and profit was therefore deemed to be derived from Nigeria. The Appellant had a fixed base in Nigeria.

“The Appellant counters that it is a foreign company with no fixed base in Nigeria, and thus not subject to Nigerian taxation under section 13(2)(a).

Besides, the subject contract was performed wholly outside Nigeria, the Appellant maintains.

JUDGMENT

The appeal was lost on the following grounds:

v Documents show that the main obligation of the contract is the work which was performed in Bonny, Nigeria.

v The contract was executed in Nigeria.

v The Appellant obtained licences for the building of the facility in question. The Appellant could not establish that Mobil Producing Nigeria Unlimited obtained the licenses and permits in Japan and that Japan is the country of operation.

v The contract allows Mobil Producing Nigeria Unlimited and other contractors reasonable access to worksite. With this, it is evident that the facility or worksite is the fixed base.

v The contract also provides that the Appellant shall provide and cause its subcontractors and suppliers to provide Mobil Producing Nigeria Unlimited and other contractors reasonable access to the worksite. In the light of this, it is evident that the facility or worksite is the fixed base. This confirms the fact that the contractors are independent of the contract between Mobil Producing Nigeria Unlimited and the appellant.

v The contract puts the obligation of making VAT payments, shipment charges, custom duties, all importation levies and undertaking operational functions in respect of the importation of the facility in Nigeria on the appellant.

TAKEAWAY

From the above, it is imperative that fixed base concept is understood. Going by the law and the decided case highlighted above, It is crystal clear that all non-resident companies carrying on business in Nigeria will be liable to pay taxes to the Nigerian Government provided that such entities have a fixed base in the Country. FIRS should therefore put deliberate efforts into issuing more public notices that will shed light on the grey areas of the law with respect to the taxation of non-residents.

TAKEAWAY

Theophilus Olufemi

Senior Tax Advisor at TAC

Source – LinkedIn

Don’t be Ignorant

by Legalnaija | Jan 17, 2018 | Uncategorized

We are devoted to making the complicated world of the law a little easier to understand. The law touches on literally every aspect of our day-to-day lives, whether we realize it or not.

you can follow the Legalnaija Blawg, receive updates and new articles every day, and interact with us both through our site or through our Facebook, Twitter, or Instagram pages.

Help share with your friends and followers. Some say: “ignorance is bliss”. However, if you know your rights you can assert those so people or the government cannot take advantage of you.

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Celebrities, Perception Management & Tax | Taiwo Oyedele

by Legalnaija | Jan 15, 2018 | Uncategorized

I was invited last Thursday to speak at an event organized for entertainers. The aim was to encourage celebrities to pay tax and embrace the ongoing voluntary assets and income declaration scheme (VAIDS).

Interestingly many of the entertainers opened up about the myriad of challenges they face ranging from piracy, to lack of access to finance, society’s expectations of them often involving maintenance of expensive lifestyles while living on handouts. While some of the celebrities may be financially buoyant, the vast majority of them are really struggling to stay afloat.

I know that nobody is excited paying taxes and so people will find any excuse to avoid paying taxes but here are some of the key lessons I took away from the event which I thought to share as some of them affect everyone, whether you are a celeb, self employed, high-networth or just a regular individual.

Documentation is key – No matter how compelling your story may be, nobody will believe you without proper evidence or documentation and it’s almost impossible to get finance or attract investors to your business. You may not even have tax to pay if you haven’t made a profit but even then you have the obligation to file returns. Wesley Snipes went to jail for failure to file returns. As much as possible get receipts for your purchases, use credit/debit cards and online banking instead of cash. Make sure you know your income and expenses and you can substantiate if required.
Tax is a legal matter – Society agrees that tax is important for there to be a government but most people wish they don’t have to pay. You can say all you want about whether government deserves your money but make sure you are on the right side of the law. The fact that other people are not compliant is not an excuse neither is ignorance.
You can do something about the Law, Tax and Governance – Some of our laws are clearly obsolete and unfit for modern day realities such as the stamp duty act which was enacted in 1939 but being applied to electronic banking when in fact there was no internet at the time. But the good news is that it doesn’t have to be this way, you and I can change it for good. We can hold government to account and ensure that only credible people who have paid the right amount of tax get elected or appointed into office to manage our collective resources – taxpayers money!
Perception management inflicts pain – You don’t have to live up to society’s expectation even if you can afford it. Some people share their pictures on social media regularly but don’t ever want to wear the same outfit twice (check the richest people in the world, they can’t be bothered). If you are trying to prove a point by showing off (flying business or first class, expensive jewelries and accessories, gadgets, luxury cars etc), you may unknowingly be exposing yourself to not only kidnappers, robbers but also the taxman – it’s like blowing the whistle on yourself, there is everything to lose and nothing to gain.

#LEADwithTaiwo #mentorshipseries

Taiwo Oyedele

Source: LinkedIn

Limits To The Powers Of The NICN To Award Damages Wrongful Termination | Faruq Abbas

by Legalnaija | Jan 11, 2018 | Uncategorized

Although the law is quite clear that an
employee whose employment was wrongfully terminated would be entitled to
damages from his employer, there seems to be some of sort of confusion
regarding the quantum of damages, which an employee whose employment was
wrongfully terminated would be entitled to. The source of this confusion can be
traced to some recent decisions of the National Industrial Court of Nigeria
(NICN), delivered after the 1999 Constitution of the Federal Republic of
Nigeria was amended in 2010 to expand the jurisdiction of the NICN and to
confirm its status as a superior court of record.

Prior to the 2010 amendment of the 1999
Constitution, the law was quite settled that if the termination of an
employment was wrongful, the employee would only be entitled to damages in
terms of payment in lieu of notice, as stated in his/her contract of
employment. This position was confirmed by the Supreme Court of Nigeria in the
case ofIfeta v. SPDC (Nig.) Limited (2006) 8 NWLR (Pt. 983) 585
where the apex Court held that although the termination of the Appellant’s
employment was wrongful, he would only be entitled to three months’ salary in
lieu of notice and his other entitlements which he would have collected if his
employment was terminated lawfully. It is instructive to note that in Ifeta
v. SPDC, the Appellant’s contract of employment provided for a notice
period of three months where either of the parties decides to terminate the
contract of employment. The position of the Supreme Court was also followed by
the Court of Appeal in the case of Bemil Nigeria Limited v. Marcus
Emeribe & Ors (2009) 3 CLRN 94 at 113 Para 20-30.

Notwithstanding the Supreme Court’s
position on the quantum of damages which an employee whose employment has been
wrongfully terminated will be entitled to, the NICN has, in certain cases,
applied its discretion in awarding damages to employees whose employment were
wrongfully terminated by their employers. Two of such cases would be considered
in this paper.

In the case of Mrs. Titilayo
Akisanya v. Coca-Cola Nigeria Limited & 2 Ors (Unreported) Suit
No. NICN/LA/40/2012, the NICN in its judgment delivered on 7th April 2016
awarded the sum of N17,368,468.00
representing the Claimant’s annual salary as damages for the wrongful
termination of her employment notwithstanding that her contract of employment
provided for one-month notice in the event of the termination of the contract.

Also, in the case of Mr. John Muir
v. Batelitwin Global Services Limited (Unreported) Suit No.
NIC/LA/151/2011, the NICN in its judgment delivered on 13th May 2013, awarded
the sum of US$193,050.00 representing the unpaid salary for the unexpired
period of the Claimant’s contract of employment as damages for the wrongful
termination of his employment notwithstanding that his contract of employment
provided for one-month notice in the event of the termination of the contract.
The pertinent facts ofMr. John Muir v. Batelitwin Global Services Limited are
as follows: the Claimant was employed on a fixed contract for a period of one
year as a Senior Piping Designer. About 4 months after the commencement of his
contract, his employer terminated his employment without notice on the ground
of incompetence and the Claimant challenged the termination of his employment
at the NICN for being null and void. He also claimed the sum of US $ 208,800.00
being the total sum of his salaries from December 2009 to August 2010, amongst
other reliefs, but the NICN only awarded him the sum of US$193,050.00 as
damages for the wrongful termination of his employment.

Interestingly, the Court of Appeal has set
aside the decisions of the NICN in Mrs. Titilayo Akisanya v. Coca-Cola
Nigeria Limited & 2 Ors and Mr. John Muir v. Batelitwin
Global Services Limited on the ground that the damages which were
awarded to the Claimants in the two cases have no basis in law since they were
based on the exercise of the discretionary powers of the NICN and not on the
settled position of the law regarding the award of damages to an employee whose
employment was wrongfully terminated.

In Coca-Cola Nigeria Limited &
2 Ors v. Mrs. Titilayo Akisanya (Unreported) Appeal No. CA/L/661/2016
the Lagos Division of the Court of Appeal in its judgment which was delivered
on 17th November 2017 reduced the damages which was awarded to the Respondent
by the NICN from N17,368,468.00 to
the sum of N1,447,373.33 representing
the Respondent’s one month emoluments in lieu of notice.

Also, in Batelitwin Global Services
Limited v. Mr. John Muir (Unreported) CA/L/566/2013 the Lagos Division
of the Court of Appeal in its judgment which was delivered on 3rd November 2016
reduced the damages which was awarded to the Respondent by the NICN from
$193,050.00 to the sum of $24,750.00 being the sum commensurate to the
Respondent’s one month salary in lieu of notice of termination of his
employment.

Conclusion

The implication of the Court of Appeal’s
recent decisions in Coca-Cola Nigeria Limited’s case and Batelitwin Global
Services Limited’s case is that the NICN would now be expected to ensure that
damages awarded in cases of wrongful termination of employment are commensurate
with the notice period contained in an employee’s contract of employment, as
against using its discretionary powers to award damages at large.

In addition, Counsel also have a duty to
ensure that they do not file claims for exaggerated reliefs in respect of
lawsuits pertaining to wrongful termination of employment since the Court of
Appeal, which is the final Court on employment related matters, has settled the
issue of the quantum of damages, which an employee would be entitled to, if
his/her employment has been wrongfully terminated.

It should be noted that this article
is for general information only. It is not offered as advice, on any particular
matter, whether legal, procedural or otherwise. If you have any questions about
this article, please contact the author.

Faruq Abbas

Managing Partner at Abdu-Salaam Abbas &
Co.

NBA -YLF Chairman and Others Visit Lagos Chief Judge

by Legalnaija | Jan 9, 2018 | Uncategorized

Yesterday, I took the initiative to ask the over two hundred active members of The Young Lawyers’ forum on Whatsapp what they would have loved to tell the Hon. Chief Judge if they were to meet her in person; the first comment was that “ I would tell her that I love her world class goggle…”. It is from here I chose to pick my ‘World Class’ prefix for the my amiable Chief Judge and her working team.

I must start by multiple congratulations, first on your appointment as the Chief Judge of Lagos State and also compliments of the Season. We bring you greetings from the leadership of the Nigerian Bar Association, Ikeja Branch and we consider it indeed a great privilege to be considered as important enough to commence your year with us. We do not take it for granted.

The Young Lawyers’ Forum of Ikeja branch is the pioneer Young Lawyers Forum, prior even to the National body of the forum. It stands arguably as the most vibrant Young Lawyers Forum in the country. The forum has not been known to pay lips service or flatter and it will not start now. But it is important to state at this time that The YLF is proud to have you. It is obvious that you are different. Your prompt response to our letter despite your busy schedule and the holiday season speaks volumes. Eventually hope has come for the profession we belong to.

My Lord, please accept our apology, for the very late invitation to our 2017 Annual Summit, I take full responsibility and assure you of diligence in subsequent engagements with your office. Your representation by the Hon. Justice Opensanwo was of a kind, My Lord did Justice to the seat and we are glad of My Lords’ choice.

At the summit our theme was ‘The Sustainability of the Legal Profession’ and in fact the first session discussed the sub-theme ‘Breaking the chain of corruption in the Judiciary’ whilst the other session discussed the ‘4th Industrial revolution and its impact on the legal practice’. We Young Lawyers are scared, we wonder whether there will be any practice by the time we are much more senior. Corruption has become the order of the day and the level corruption operates has remained at an all time high.

We have come to pledge our support for the great work you are set to do. We assure you that we are with you. A yoruba adage which our amiable Chairman, Mr. Adesina Ogunlana often says to us is interpreted as follows ‘ It is the youth that saves you in public, but the elders will deliver you in the board room’. My Lord, we assure you that the streets are save for you, the Young Lawyers’ of your constituency are with you. Let those who want evil to prevail try hard, you will remain above. We will save the Judiciary, we will save our profession, we will work with you to ensure that Justice is true to its definition.

My lord, we are aware that the stakeholders forum, your detailed visit to the courts across the state has exposed so much that you need to do and we will not stress them. We have only come to bring to the notice of Your Lordship that you have ready and willing hands in us.

As a forum, we undertake several initiatives for the development of young lawyers; we hold monthly Continous Legal Education Seminars, Annual Summit, Mentoring sessions with seniors, as well as social activities for bonding. We went ahead to visit the Ikoyi prisons in December, 2016 in celebration of the World International Human Rights Day and inherited about 97 case files of persons being held for minor offences. As at today, we have dispensed with 93 of the cases.

Despite the forums’ challenge of funds, which we hope your Lordship will assist with, we have consistently worked to ensure we are visible and active in the journey towards a better justice delivery system.

We have come to humbly request of my lord to adopt the ongoing discussion of ‘not too young to run’ in her engagements with a slight modification ‘not too young to serve’. All young lawyers are not incompetent as we are made to seem, we are not all lazy, we are strong, hardworking and forward thinking professionals too. We are not lesser than other young professionals simply because we are lawyers. We need My Lord to trust us, we need your lordship to engage us. Give us the opportunity to work with your administration, to serve in your committees, to make recommendations that can save the future of the judiciary, which indeed is ours.

A good example of areas which we know you already have in focus is the Sheriffs section, there is so much to do there. We suggest that the department be automated. The process of auction is the highest embellishment of corruption, the e-filing system needs complete overhauling, the registrars are a great torture, as it is we are the most hit because we do more interaction with them. The need to demand due respect for lawyers with law enforcement authorities can also not be over emphasized.

We shall continue to intimate you of our activities as at when they come up, we shall continue to seek your support and involvement, we shall continue to be available to notify you of things that may interest you to ensure you succeed in your cause.

My Lord, we are here for you, we want to work with you. We want to save the future of the practice. We know it is in our interest to do so as you will soon leave us to it, we hope you won’t consider our offer as insignificant.

Thank you

PUC Holds Annual New Year Party

by Legalnaija | Jan 6, 2018 | Uncategorized

It was an evening of fine wining and dining as one of Nigeria’s leading legal chambers, Paul Usoro and Co., PUC, held her annual New Year Party at the Colonades Hotel, Ikoyi.

The Event was well attended by staff of PUC, who came out to have a good time and celebrate the successes of the past year and usher in the year 2018.

Paul Usoro & Co is led by Paul Usoro, SAN, one of Nigeria’s foremost communications law experts.

Represented at the event, Mr. Usoro commended the entire PUC team for their consistency and diligent efforts in ensuring that 2017 was a successful year. “Indeed, this is a gathering of deserving lawyers who have worked hard and contributed to our success in 2017. One of the highpoints of 2017 was that we were recognized as the Transport Law Firm of the year by the Global Law Experts. As I officially welcome us all to 2018, I want to encourage us to keep up the team spirit and diligence so that we can have a better year.

See photos below…..

Tv And The Law- Legal Issues With Film Making In Nigeria

by Legalnaija | Jan 4, 2018 | Uncategorized

Entertainment on TV is a great form of
“decompression”. I personally enjoy cartoons and movies produced in Hollywood,
Bollywood, and of course my very beloved Nollywood. Growing up, I vividly
remember watching Nigerian Movies like Violated and soap
operas like Checkmate and Beyond the Clouds with
family. This tradition has obviously continued, as we just saw The Wedding
Party, which by the way is hilarious, and we are currently earnestly
awaiting The Royal Hibiscus Hotel.

Through this, it’s impossible to miss the
fact that the Nigerian movie industry aka Nollywood has and is experiencing an
evolution from the home video outfit as we knew it, to a full blown production
apparatus. This is evident in the plot quality, script and cast. Without a doubt,
Nollywood has emerged to be a vibrant sector in the Nigerian economy. Who would
have thought?

In light of these advancements, a lot of
opportunities for improvement have consequently been revealed. As is similar
with other emerging industries, having an effective and proactive legal frame
work has been the major key to sustainability and profitability; hence the
purpose of this write up is to point out the various legal issues that may
emerge, as various stages of production in Nollywood.

For the purpose of this write up, I have
summed the stages of film production into three parts:

1) The
Pre-Production stage:

This is the initial
stage where the idea for any production is conceptualized. This stage includes
but isn’t limited to sourcing capital, location and crew scouting, development
of set.

2) The
Production stage:

This stage involves
the actualization of the concept – technically the first proof of concept.

3) The
Post Production stage:

This stage involves
the marketing to the target audience, negotiation with channel partners to
enable distribution. These channel partners, might be cinemas and actual sales
outlets.

Of course, through these stages a number of
legal issues arise – I will enumerate a couple below in no particular order;

1) Protecting the
Intellectual properties (ideas and concepts) that are to be used in the
production via Intellectual Property Laws.

2) Developing or
acquiring a script. In the case of the latter, effectively negotiating with the
script writer about property rights.

3) Agreement on
securing debt to fund the productions and terms on repayment and defaults.

4) Non-disclosure
agreement to secure intellectual property that wouldn’t be featured in the
final production.

5) Acquisition and
negotiation of right of use and access to various locations essential to the
success of the production. Example, shooting a scene in a government owned
airport.

6)
Acquisition of required licenses from original right owners. Example, right to
use of songs, artistic works in Gallery.

It’s definitely reasonable to seek relevant
legal advice to avoiding actionable scenarios.

Below are some things to put in mind.

Contractual relationship issues:

1) What
to do when contracting with a partner outside the country

2) Contracts
with Actors, producers, Director, and other parties involved in the production
process

3) Contracts
with the channel partners

4) When
agreements are said to reached by both parties

Piracy legal issues

1) Enforcement
of Intellectual Property Rights

2) What
constitutes infringement of these rights.

3) Determine
the chain of title in a film – who owns what and how they can be enforced.

Case in point Mike Tyson’s Tattoo
in Todd Philips’ The Hangover Part 2

S. Victor Whitmill, the Tattoo artist who
created a distinctive tribal tattoo for boxer Mike Tyson, sued Warner bros to
prevent the release of the sequel because his copyrighted artwork had not been
properly licensed. Though the tattoo was on Mike Tyson’s face in the original
film, in the sequel it appeared on Ed Helms Face and was on major posters
advertising the film.

Although the artist failed in his attempt
to secure an injunction stopping the release of the movie, he proceeded on a
copyright infringement suit. In rejecting the suit ,the Judge -Catherine D
Perry indicated that she believed Mr. Whitmill suit has a great chance of
success , as she confirmed that a tattoo being an artistic work can be
copyrighted. She also rejected Warner Bros defense of Fair use.

Although Tyson received the tattoo in 2003,
he also signed a document stating that the artist keeps the rights. Warner Bros
claims that their rights to use the tattoo is part of the agreement with Tyson,
but if Tyson never had those agreement in the first place it will be difficult
to claim.

The foregoing case could have been avoided
and funds put to better use by finding out what rights are needed and acquiring
the proper license from the Artist or persons you believe granting the rights
actually owns them.

Having a lawyer on retainer is definitely
worthwhile to enable a smooth sail through the various production stages.

Toju
Dottie

Senior Associate & Consultant

George Ikoli & Okagbue

Source; Linkedin

Fashion And Law In An Emerging Economy | Toju Dottie

by Legalnaija | Jan 4, 2018 | Uncategorized

Ralph Lauren once said that “Fashion
is not necessarily about labels, it’s not about brands. It’s about something
else that comes from within you”. He was basically alluding to the fact
that fashion in its tangible form – is a statement. A statement of simplicity
or explicit extravagance. These statement have been in forms
of accessories, scents, or general combination of various fabrics to
make distinctive apparels as is common in Sub Saharan Africa. On a
personal front,fashion has been a medium for projecting a bit of my personality
and current mood.

Growing up, threads, needles and sewing
machines were common fixtures of my childhood- thanks to my mother’s love/
hobby, which eventually became her “main hustle”. Looking
retrospectively, being around the entire creative process led to my lifelong
fascination with everything fashionable.

Recently, I was opportune to attend a
private viewing of a Nigerian Fashion Brand (MAZELLE) Summer Spring 2018
Collection- it’s definitely worthy of note that the fashion industry in
Nigeria, has evolved from the era of “Obioma” (road side tailor) to a
recognized industry. This evolution has definitely brought to light the need to
have a formidable regulatory body/ association to advance and advocate the
cause of the fashion Industry in Nigeria. A body, similar to The Arab Fashion
Council, British Fashion Council and The Council of Fashion designers in
America. These councils have and are continuously contributing to the longevity
of the fashion industry in their various economies.

In light of aforementioned and given the
unique situation of the Nigerian Fashion Industry- The below list ( neither
conclusive nor an exhaustive list) will help emerging fashion entrepreneurs,
fashion enthusiast and established brands understand few legal
frameworks and issues associated with a fashion establishment.

1.     Setting
up a Fashion Enterprise – This involves the incorporation of the business,
structure and funding of the business.  In developing personal names
as fashion brands, designer should be aware that there are a number
of risks that could arise- in the event the company is sold they
might lose the right to use their names in the industry. They might also
encounter hurdles in registering their personal name as a trademark.
Structure and funding of a business ( whether fashion or not) is an integral
part of any organization as it sets the foundation and the core of the
business.Case- Kylie Minogue Vs
Kylie Jenner– Kylie Jenner filed to register the name KYLIE as a
trademark in relation to advertising services and endorsement services but was
blocked by way of an opposition application brought by  Veteran
Australian Pop Star Kylie Minogue citing possible confusion and damage to
Minogue’s Branding. According to papers filed in the US patent and
Trademark Office ( USPTO), Minogue’s legal team noted that their client a
renowned performing artist , humanitarian and breast cancer activist already
owned  KYLIE related trademarks in the US in several
industries as well websiteswww.kylie.com. However Minogue’s
team withdrew its opposition so there is a possibility they agreed to a
settlement.

2. Intellectual
Property Issues- This boarders on Trade mark registration, Design
protection and copyrights involved in the business. We have seen this play out
with the different litigation cases that have occurred involving brands
like Christian Louboutin, Yves Saint Laurent (YSL), Gucci and Forever 21 e.tc.
Knowing the exact type of Intellectual Property that pertains to the
business and the laws involved is fundamental in the industry to protect
the brand and enforce rights attached to it. Case- Christian Louboutin Vs Yves Saint
Laurent(YSL) – Shoe Designer Christian Louboutin battled YSL in court
over ownership of his famous red soles. The litigation began when the French
house launched a collection of shoes in a range of colors , each with a
sole that matched its upper. The court held that Louboutin could not prevent
other brands from creating red shoes with red soles, but that no other brand
should create a shoe contrasting with a red sole as that was
likely to cause confusion for customers who would assume the shoe was by
Louboutin. Christian Louboutin who holds a valid US trademark is headed back to
court again to protect his trademark in the European Union; hence making sure
that European brands adhere to the guidelines.

3. Retail- This
deals with the final product reaching the consumers either from a storefront
or via online platforms. Ensuring PCI (payment card industry) compliance
with every transaction is key when transacting online.There is also a duty to
secure the customer’s information.

4.
Contractual Relations- Validity and enforcement of contracts such as Employment
( Labour matters) , Sponsorship and Sales agreements, Licensing , partnerships
and franchise e.tc

5. International
Trade- This involves expanding the business. This will also
raise several issues and engage several regulatory bodies such as
the Standard Organization of Nigeria, The Nigerian Export and
Promotion Council and the Nigerian Custom for border control. These bodies
usually render advise and enforce Intellectual Property Rights of brand owners
against counterfeiters.

6. Marketing-
This is one of the major factors in the fashion industry as it involves
introducing the brand to its consumers or the general public. This is
where social media platforms and fashion bloggers have created a niche for
themselves and have held the power to shape the public’s perception of the
brand. Brand owners have a right when the blogger’s narrative is not true or
slanderous of the brand. Bloggers should be aware of copyright laws on
infringement with a focus on content ownership and syndicated issues. The
blogger should also be armed with the( knowledge of) defence of Fair
Use in its application to posts especially in photography and where to get
photos.

Engaging the services of a lawyer is
absolutely important to navigate through the industry.

Disclaimer: This article is only intended
to provide general information on subject matter and does not itself
create a client /attorney relationship between the reader and the author.
Specialist legal advise should be sought about the readers specific
case.

Toju
Dottie

Senior Associate & Consultant

George Ikoli & Okagbue

Source – Linkedin

SARS: The Necessity For A Total Structural Overhaul| Motunrayo Olaleye

by Legalnaija | Jan 4, 2018 | Uncategorized

INTRODUCTION

The Nigerian Police (NP) is the principal
law enforcement agency in Nigeria and its functions, duties and powers are
contained and regulated by the Police Act (CAP P19 Laws of the Federation of
Nigeria 2004). Additionally, Police Officers are subject to the code of conduct
for Police Officers.

The Criminal Investigation Department is
the highest criminal investigative arm of the Nigerian Police Force. The
Special Anti-Robbery Squad (commonly known as SARS) is one of the 15 units
under the Nigerian Police Criminal Investigation and Intelligence Department.
Its duties include the arrest, investigation and prosecution of suspected armed
robbers, murderers and others involved in the commission of violent
crimes.

The NP are an organization recognized as
the custodians of security and order in society. However, in light of current
events, the SARS unit of the NP is being touted as a violent, exploitative and
oppressive system by disgruntled citizens. This article shall consider the
negative reputation of the SARS and highlight the rule of law in relation to
the powers of the NP.

NARRATIVE

The writer will present a very familiar
scenario which most Nigerians have experienced firsthand, witnessed or been
told about. A lot of people will affirm
that this story is a familiar one.

A young man on vacation to Nigeria is
arrested while taking a leisurely stroll in the evening. He is confused as to
the reason he has been arrested but strongly believes an explanation will be
given; after all everyone is allowed to take strolls, right? He is subsequently
whisked off to an unknown police station, and after 48 hours in detention with
no communication with his family; his belief that he cannot be arrested for no
reason at all has faltered greatly. He has of course been stripped of all his
personal effects; his fancy phone inclusive. By the time a kind person manages
to contact his mother on his behalf; his belief has taken a complete turn
around and now he is certain that there is no escape from the hell hole he
exists in. This is not a place where shouting, crying or begging achieves any
results. His mother’s joy that her only
son has been found and was not kidnapped as she previously feared is cut short;
perhaps his fate may have been better at the hands of kidnappers who merely
wanted a satisfying ransom. This young
man was right after all; because he was killed in custody with the explanation
that he was a robbery suspect who tried to escape. Many of such people are not
alive to tell their story. They have been silenced forever; the horrors they
faced not to be discovered by anyone.

STATUS
QUO

Nigerians in their myriad of challenges
forget the past, until the present reality resurfaces buried memories. Sequel
to various continuous reported and unreported incidents of abuse, harassment,
unlawful detention, extortion and murder by officials of the Special
Anti-Robbery Squad; Nigerians are now advocating vigorously for the elimination
of SARS on social media and the campaign against SARS is trending.

A series of reports have been made in the
past few years with respect to the degrading treatment and unjust harassment
frequently meted out by SARS operative; a notable report is the one made by
Amnesty International in 2016 (https://www.amnesty.org/en/latest/news/2016/09/nigeria-special-police-squad-get-rich-torturing-detainees/)
wherein a press release accusing SARS officials of extortion, torture and
inhumane treatment was vehemently refuted by the Inspector General of the
Nigerian Police Force.

Irrespective of the admittance or refusal
of the allegations levied against officials of SARS, it is no news that the
motto of the NP; “Police is your friend” is very laughable in Nigeria. Millions
of people have been harassed and oppressed and continue to be subject to
dehumanizing and degrading treatment by police men while supposedly carrying
out their duties.

It would appear that most people while not
being completely ignorant of their rights simply do not know what to do, and
the few that are informed would understandably cower in fear or have lost the
will to fight for a seemingly hopeless cause.

The need to reiterate our basic rights
cannot be over emphasized as we continue to lend our voices as a sword till we
get the desired result.

STATISTICS

According to the PRAWA (a Non-governmental
organization aimed at promoting Security, Justice and Development in Africa) Report
on Prisons Monitoring, Investigation and Documentation of Torture Incidence in
Enugu State conducted in March 2011, The Special Anti-Robbery Squad has Police Officers
who are designated to torture crime suspects. Such Police Officers have an
unofficial designation like “OC Torture” (Officer In Charge of Torture), and
they have special skills in infringing various methods of torture on their
victims; which methods include but are not limited to prolonged detention in
police custody, gunshot wounds, severe beatings with police baton and other
dangerous objects , burning with hot objects, squeezing of testicles and
inserting objects into the penis, insertion of nails on feet, electric shock,
suspension on the tree in different positions and cutting with cutlass. (www.prawa.org)

LEGAL
PERSPECTIVE

The various forms of infringement of our
fundamental human rights in the exercise of the powers of officials of the SARS
will now be considered in tandem with the existing legal frame work that should
regulate the conduct of Police Officers.

It is relevant to note as a preamble that
Article 5 of the Universal Declaration of Human Rights and Article 7 of the
International Covenant on Civil and Political Rights provide that no one shall
be subjected to torture or to cruel, inhuman or degrading treatment or
punishment. Nigeria as a country should aim to achieve internationally
recognized standards of human rights, not only by the mere ratification of
international treaties and conventions but in the practical demonstration that
as a nation, we uphold the sanctity of life and we view human rights as
paramount.

Arrest
without warrant:
Section 24 of the Police Act provides that a Police Officer can lawfully arrest
without warrant for a felony, a misdemeanor, a simple offence or for breach of
peace. It would therefore appear that a Police Officer can arrest without
warrant at all times; as the definition of what qualifies as reasonable
suspicion remains non-specific and non-delineated. However; Section 3(1) of the Administration
of Criminal Justice Law 2011 (ACJL) provides that the Police Officer must
inform the person arrested of the cause of the arrest. Similarly, Section 4 of
the Police Act prohibits arresting a person in lieu of a suspect; which implies
that one person cannot be arrested in place of another. Additionally, Section 3
(2) & (3) states that the person must also be informed of his right to
remain silent, the right to consult his lawyer before making any statement and
the right to free legal representation. Furthermore, by the provisions of
Section 35 (5) of the 1999 constitution a person who is arrested without
warrant must not be detained for more than 24 hours where there is a Court of
competent jurisdiction within a radius of 40kilometres or in any other case, 48
hours or for such longer period that the Court may consider to be reasonable. A
deviation from the provisions of the law on arrest entitles the victim to seek
enforcement of his fundamental rights, damages and a public apology.

Torture
and inhumane treatment: Nigeria has ratified the International Convention on
Civil and Political Rights (ICCPR) in 1993, the Convention against Torture
(CAT) in 2001 and the Optional Protocol to the Convention against Torture
(OPCAT) in 2009. Additionally, Nigeria is a member of the African Charter on
Human and People’s rights. Irrespective of the above, the practice of torture
and ill treatment by Police Officers in general and officials of SARS particularly
remains rampant. There are countless experiences of people who have been
brutalized, ill-treated and tortured in detention. Section 34 (1) of the 1999
Constitution of the Federal Republic of Nigeria (as amended) prohibits the use
of torture and inhuman or degrading treatment, therefore a person under detention
who is beaten or threatened has the right to seek legal redress for
infringement of his right.

Unlawful
detention:
The right to personal liberty is guaranteed under Section 35 of the 1999
Constitution. Even though this right is not absolute; any restraint to personal
liberty must be done in accordance with a procedure permitted by law. Unlawful
detention can be defined as keeping a person in custody without any lawful
reason. (https://dictionary.thelaw.com).
Therefore, being detained in the custody of the Nigerian Police either with or
without the power to arrest and detain may amount to unlawful detention. It could also be interpreted to mean being
held up at a gun point with threat of being shot if you try to move. In the
same vein, a proviso to section 35 (1) of the constitution (as amended) states
that ,“a person who is charged with an offence who has been detained in
unlawful custody awaiting trial shall not continue to be kept in such detention
for a period longer than the maximum period of imprisonment prescribed for the
offence”. A contravention of the laws guiding the right to personal liberty
will therefore amount to a breach of fundamental rights.

Inducement
to give false confession: A false confession is an admission of guilt for a
crime for which the confessor is not responsible. (en.m.wikipedia.org/wiki/false_confession).
The right to dignity of human person as contained in Section 34 of the
Constitution which prohibits torture extends to the right not to be forced by
the police to make a statement under duress. Therefore, a statement must be
given voluntarily by the person making the statement without physical coercion,
torture, promise or threats. Any such confession can be set aside in a Court of
competent jurisdiction.

Extra
Judicial killing: An
extrajudicial killing (also known as extrajudicial execution) is the murder of
a person by governmental authorities without the sanction of any judicial
proceeding or legal process. (https://en.wikipedia.org/wiki/Extrajudicial_killing).
The relevant provision of the Constitution with respect to the right to life is
Section 33 (1) which provides that a person can only be deprived of his right
to life when he has been found guilty of a criminal offence. A person can also
be deprived of his right to life in order to effect a lawful arrest or to
prevent the escape of a person lawfully detained. Therefore; a person who has
been unlawfully detained and is killed in custody has been illegally deprived
of the right to life. Section 36 of the Constitution provides for the right to
fair hearing and Section 36(5) provides that an accused person is deemed
innocent until proven guilty in a competent court of law. Therefore, it grossly
offends the intent of the NP as custodians of the security of the citizenry to
kill an armed robber or any other person in custody. The relatives of a victim
of extra judicial killing have a right of recourse against both the police
officers responsible for the death and the Nigerian Police as an organization.

WAY
FORWARD:

It is clear that the provisions of the
Constitution with respect to human rights are grossly violated by the NP who
continually infringe on rights guaranteed under Sections 33, 34, 35, 36 and 41
of the Constitution. Furthermore, the power of the police to arrest and detain
is indisputably wide and has created the forum for abusive interpretation by
officials of SARS, the entire police force and other law enforcement agencies.

The elimination of the Special Anti-Robbery
Squad may not be the absolute solution as that may lead to a change in uniform
and not character .There is however an urgent need to contain the abuse of
power and excesses of government agencies and their personnel/officers;
inclusive but not limited to the NP in the performance of their duties.

Furthermore, it is pertinent that checks
and balances are created as well as the implementation of proper training of Police
Officers in areas such as safety, use of firearms, respect for human rights,
treatment of suspects and other related areas.

This may involve the dismissal of
unqualified, erratic or emotionally unstable police officers from the NP.

Additionally, there is a need to introduce
a system that involves inventory and records of detainees, investigation of all
incidents of torture and extra judicial killings, supervision of all police
officers and sanction.

Section 36 (6) of the Constitution provides
that a person who is unlawfully detained shall be entitled to compensation and
public apology. See the case of Ozide
&Ors. Vs Ewuzie &Ors. (2015) LPELR – 24482 CA where it was held
that damages in compensation, legally and naturally follow every act of
violation of a citizen’s fundamental right.

Additionally, legal redress can be sought
by filing an action in Court for infringement of fundamental human rights. In
the case of ANOGWIE & ORS v. ODOM
& ORS (2016) LPELR-40214(CA), the Court held:

“It
was the need to curtail the excesses of the men and officers of law enforcement
agencies that made it necessary to strengthen the Fundamental Human Rights
(Enforcement Procedure) Rules in Nigeria, not long ago where it was held that
the Court is always prepared and will be quick to give relief against any
improper use of power or any abuse of power by any member of the Executive, the
Police or any other person…”(emphasis mine)

Nigerians are therefore encouraged to
challenge the breach of their constitutional rights by the Police or any other
law enforcement agencies in a bid to curb extreme and unrestrained violation of
rights.

CONCLUSION:

Accountability plays a major role. If we do
not begin to learn to take responsibility for our actions, from the petty thief
to the dubious employee, the corrupt politician or the trigger happy police
man; then the change we are all advocating for will remain chants of a
frustrated people.

Motunrayo Olaleye

Counsel

B.A. Ayorinde & Co.,

Guidelines And Requirements For Drone Use In Nigeria | Toju Dottie

by Legalnaija | Jan 4, 2018 | Uncategorized

I recently was
asked if there are guidelines/ licenses for operating drones for commercial
purposes in Nigeria, If yes, what are they and the requirements needed to
obtain a such license?

The Nigerian
Civil Aviation Authority (NCAA) issued a statement prohibiting the launch of
remotely piloted aircraft (known as ‘drones’) in the Nigerian airspace without
a permit from the NCAA and the Office of National Security Adviser (ONSA). The
NCAA stated that the move was part of the safety guidelines issued by the regulatory
agency to drone operators.

NCAA
guidelines and requirements

To qualify for
the issuance of certificate, applicants are expected to undergo five phases.
These are as follows, Pre-Application, Formal Application, Document Evaluation,
Demonstration & Inspection and Certification phases.

An application
for grant of a permit for aerial aviation services (PAAS) must be made in
writing to the director general of the NCAA. The application should be signed
by a person duly authorised by the applicant and submitted on or before a date
no less than six months before the expected date of use of the PAAS.

Required
Information:

The application
for the grant of a PAAS must contain the following particulars:

1.
name and address of the applicant;

2.
type of air services to be provided;

3.
proposed operational base of the applicant;

4.
details of proposed routes to be operated, where
applicable;

5.
the number and types of proposed aircraft to be
used; and the time and frequency of the services.

6.
The following supporting documents are required for
processing the application:

a.
four copies of the certified true copy of the
company’s certificate of incorporation;

b.
four copies of the certified true copy of

–
the memorandum and articles of association;

–
the particulars of the directors of the company
(Form CAC 7); and

–
the statement of share capital/return of allotment
(Form CAC 2) with minimum paid-up share capital of N20 million; at least one
member of the board of directors must be an aviation professional and the
majority shareholding must be held by Nigerian(s);

c.
four copies of the current tax clearance
certificates of the company and each director (the originals should also be
submitted for sighting);

d.
four copies of a detailed business plan of the
operation indicating, among other things:

e.
the company’s vision, mission, market analysis and
strategy; and

f.
the company’s ownership structure, personnel plan,
fleet acquisition plan, financial plan including source of finance, balance sheet,
break-even analysis, pro forma income projections (profit and
loss statements), cash flow analysis and charter rates for passengers or cargo;
and

g.
other standard business plan requirements showing
detailed roadmap of how the applicant intends to provide efficient services;

h.
evidence of the applicant’s solvency to undertake
the business;

i.
duly completed application forms;

j.
duly completed personal history statement (PHS)
forms and two passport photographs for each shareholder of the company with
more than a 5% equity shareholding (the PHS forms are to be completed at the ONSA
headquarters in Abuja); and

k.
a N500,000 non-refundable processing fee.

Please bear in
mind that on receipt of the application, the NCAA may request additional
information from the applicant as necessary. The outcome of the technical
evaluation of the application, accompanied by an appropriate recommendation,
will be forwarded to the Air Transport Licensing Committee for consideration
and approval of issuance of a licence or otherwise as soon as the security
clearance or comment has been received from the ministry. The NCAA will refuse
to grant a licence if the applicant is not cleared by the State Security
Services’ Office. Licences not used when their three-year validity period
expires will not be renewed.

A PAAS is valid
for three years. Upon receipt of a PAAS, an annual use fee of N100,000 must be
paid to the NCAA.

Oando Reservoir
and Production Services Ltd. received the certificate having satisfied the
requirements and found competent to secure the safe operation of the Aircraft
type Lockheed Martins SN 248-255. The certificate is for flights with the
purpose of aerial work specifically Environmental Observation Monitoring and
Protection.

In researching, I
observed from the NCAA website that there is no distinction in
guidelines between commercial use and recreational use . Possibly these guidelines
apply to recreational use of drones in Nigeria; however I have seen movie
producers and photographers make use of this equipment and I doubt that they
have gone through this rigorous hurdle to obtain a license.

DISCLAIMER:
Recourse should be made to the writer or the NCAA for further clarification
or information on the matter.

Toju Dottie

Senior Associate
& Consultant

George Ikoli &
Okagbue

Source : Linkedin

Photo credit – www.dronelife.com

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