Cumbersome Registration Process In CSO Space, Amid Needs For Reforms

In this report, ROYAL IBEH delves into the intricate world of Civil Society Organisations (CSOs) operating at the grassroots amid bottlenecks hindering their activities.

However, a significant predicament arises when it comes to securing funding from donors. It is disheartening to learn that most CSOs in Nigeria do not capture the attention of donors simply because they are not legally incorporated entities with the Corporate Affairs Commission (CAC).

Chairperson of the Enugu State Network of Civil Society Organizations, Comrade Emmanuel Acha lamented this major challenge. Acha said a vast majority of CSOs at the subnational level operate under cooperative structures, causing donors to overlook their efforts due to their unregistered status.

Distressingly, she said an estimated 80 per cent of CSOs and NGOs function at this level, possessing great potential to address crucial community issues such as maternal and child mortality, environmental concerns, and both communicable and non-communicable diseases.

However, the formidable process of incorporating CSOs through the CAC in Nigeria significantly impedes the operations of NGOs within the country. A prime example is the Diabetes Control Media Advocacy Initiative (DICOMAI), established in 2019.

The founder of DICOMAI, Mr. Sam Eferaro, recounted the difficulties he has faced. Since its inception, Eferaro said the organisation has been unable to progress beyond the registration stage with the Special Control Unit Against Money Laundering (SCUML)

He expressed his frustration, highlighting the prolonged process he has endured for over four years, He added that the challenges involved in establishing an NGO in Nigeria are numerous.

Acha who explained the exclusive legislative list outlined in Item 32 Part 1 of the second schedule of the 1999 constitution, which governs the incorporation, regulation, and dissolution of corporate bodies, including NGOs and CSOs, said the CAC, a federal government parastatal, derives its authority from this list to oversee the incorporation, regulation, and dissolution processes.

Recently, he said registering an NGO with the CAC has become an arduous task.

Acha explained that the initial hurdle a prospective NGO faces are the challenge of selecting a suitable name.

“When approaching the CAC for registration, the organisation must undergo a name search process, which can take up to a month. The CAC often rejects chosen names, particularly if they are associated with political interests or already in use, leaving many NGOs disheartened.

“Obtaining the necessary funds for registration presents another obstacle,” he said.

Acha emphasised that while many NGOs are driven by the passion to tackle societal issues, they often lack the financial resources required for registration.

Moreover, he said CSOs bear the burden of multiple regulatory procedures, including registration with the CAC, verification by SCUML, and tax filing with the Federal Inland Revenue Service (FIRS), further adding to their challenges.

Furthermore, he said CSOs face the issue of multiple registrations as they navigate through various regulatory bodies such as the Economic and Financial Crimes Commission (EFCC) and the Financial Reporting Council of Nigeria. These bodies demand additional regulatory obligations from CSOs, creating further bureaucratic hurdles.

“The current state of CSO registration in Nigeria necessitates urgent reforms to simplify the process and enable these organizations to fulfill their vital roles in society,” he said.

Interpretation of the law

The interpretation of the law regarding the incorporation of Civil Society Organizations (CSOs) reveals an important distinction.

Associate director of Corporate Accountability and Public Participation Africa (CAPPA), Aderonke Ige, explained that according to Item 32 Part 1 of the second schedule of the 1999 constitution, the power to incorporate CSOs lies with the Corporate Affairs Commission (CAC).

However, she highlighted that states have the authority to register these organisations.

Ige clarified that the Companies and Allied Matters Act (CAMA) is the legal instrument used for incorporation, emphasising that it is a federal law, hence its inclusion in the exclusive legislative list.

She further explained that states are expected to register, rather than incorporate, organizations within their jurisdiction.

“After obtaining legal status from the CAC, organisations can be registered by the states to authenticate their presence and operations in the respective state,” she said.

The way forward

To address the existing challenges, the secretary general of the Nigeria Network of NGOs (NNNGO), Ayo Adebusoye suggested moving Item 32 of Part 1, Second Schedule of the 1999 Constitution (as amended), from the exclusive list to the concurrent list.

Adebusoye said this would empower State Houses of Assembly to establish bodies that can both register and incorporate organizations.

Alternatively, Adebusoye revealed that CSOs in Nigeria are currently drafting content to strengthen CAMA.

“This content could either be integrated into CAMA itself or developed as a stand-alone bill, allowing subnational CSOs to be incorporated or granted legal identity through a Nonprofit Commission working in coordination with state structures, in the absence of the constitutional amendment,” Adebusoye said.

Taking action, the European Union Agents for Citizen-driven Transformation (EU-ACT) Programme has created a platform for Network of Civil Society Organisations in all 36 states to engage in discussions, preparation, and submission of a memorandum to the Senate Adhoc Committee on Constitution Review.

The national programme manager of the EU-ACT Programme, Damilare Babalola, said that the memorandum highlights the issues posed by Item 32 Part 1 of the 2nd Schedule of the Constitution.

Babalola said the aim is to remove this item from the exclusive legislative list and include it in the concurrent list, enabling the incorporation of entities, including CSOs, at both federal and state levels.

“The networks actively participated in zonal and national public hearings, bringing attention to the challenges associated with this constitutional provision. This issue was also extensively debated at the First National Conference on Civil Society Regulatory Environment held in September 2022, further amplifying the awareness and advocacy efforts of CSOs,” Babalola said.

Supporting CSOs and harmonizing registration procedures

Another significant initiative undertaken by the ACT programme is the support provided to CSOs through networks in 10 pilot states to review the existing legal frameworks, or lack thereof, concerning the registration of CSOs at the state level. The objective is to identify solutions that can harmonize the registration procedures for CSOs with state governments.

“This effort aims to not only streamline the registration process but also establish a regulatory framework that supports the registration of CSOs in these states. Such measures would help change the perception of risk associated with state-registered CSOs, encouraging donors and other stakeholders to take them more seriously and provide the necessary financial support,” explained the national programme manager.

Babalola said it is a well-known fact that donors often prefer to work with grassroots CSOs that are actively making a difference in communities and positively impacting lives.

However, he said due to their rules and procedures, donors are hesitant to provide grants directly to unincorporated entities.

“This restriction hinders the funding opportunities for state-registered CSOs, despite their valuable contributions,” Babalola said.

In light of these challenges, the national programme manager urged CSOs to actively engage in discussions with lawmakers, relevant government agencies, the private sector, and other stakeholders involved in the conversation.

Babalola said by actively participating and advocating for change, CSOs can contribute to creating a more conducive environment for their operations.

While acknowledging the importance of donor support, the founder of DICOMAI, Mr. Sam Eferaro urged CSOs not to solely rely on external funding.

He emphasised that CSOs should continue to make a meaningful impact in society, irrespective of donor assistance.

Eferaro also called on donors to expand their criteria beyond solely considering legally registered CSOs.

He said many CSOs and NGOs are doing exceptional work at the community level, but they often go unnoticed.

He implored donors to proactively search for and support these deserving CSOs.

By fostering collaboration between CSOs, government institutions, and donors, a more inclusive and supportive ecosystem can be established, enabling CSOs to thrive and make a lasting difference in their communities.



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