Section 95 Investments and Securities Act 2025

Section 95 of the Investments and Securities Act 2025 is about Control of invitations to the public. It is under Part IX (Regulation of Securities) of the Act. It provides as follows:

(1) A person shall not make any invitation to the public to acquire or dispose of any securities or to deposit money with any body corporate for a fixed period or payable at call, whether bearing or not bearing interest unless the person or body corporate concerned is —
(a) a public company and the securities it seeks to offer to the public have been registered with the Commission;
(b) a statutory body or bank established by or under an Act of the National Assembly and is empowered to accept deposits and savings from the public or issue its own securities, as defined under this Act, promissory notes, bills of exchange and other instruments;

(c) an entity licensed by the Central Bank of Nigeria and empowered to accept deposits and savings from the public;
(d) a collective investment scheme;
(e) government body or an agency of a government body, supranational body or such other entity approved by the Commission to issue securities under this Act; or
(f) a free trade zone entity whose capital raising exercise has been approved by the Commission:

Provided that where the Commission approves a capital raising exercise by an entity operating within a free trade zone, such entity shall thereupon become
subject to relevant tax laws and regulations in Nigeria, and nothing in this subsection shall render unlawful the sale of any shares by or under the supervision of any court or tribunal as may be authorised by law.

(2) The term commercial or investment business activities referred to in subsection (1) means any activity relating to micro, small and medium scale enterprise, venture capital and private equity funding or such other commercial or investment business activities as the Commission may determine.

(3) The provisions of section 142 of Companies and Allied Matters Act, shall not be applicable to issuers of securities under this Act.

(4) Where an invitation to the public is made in breach of subsection (1), all persons making the invitation and every officer who is in default or any body corporate making the invitation shall each be separately liable to a penalty of at
least 10% of the gross value of the securities or deposits received in the case of a body corporate and N2,000,000 in the case of an individual.

(5) Where, any person acquires or disposes of securities, or deposits money with any company, as a result of any invitation to the public made in breach of subsection (1), he shall be entitled to —
(a) rescind such transactions; and
(b) either in addition to or in place of rescinding the transaction, recover compensation for any loss sustained by him from any person who is liable in respect of the breach.

(6) Where, in accordance with subsection (5), a person claims to rescind any transaction, he shall do so within a reasonable time and shall not be entitled to rescind any transaction with the body corporate or to recover compensation from it unless he takes steps to rescind the transaction before the commencement of the winding-up of the body corporate:

Provided that the application of this subsection to bar the right of a claimant to
rescind a transaction shall not prejudice his right to recover compensation from
any person other than the body corporate.