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Nigeria’s Stock Exchange Safeguards Shareholder Rights

Nigerian Stock Exchange | Techrectory
Nigerian Stock Exchange Image by Techrectory

The Nigerian Stock Exchange took a significant step towards the implementation of the Demutualization of the Exchange Act, 2018 by inaugurating its Claims Review Panel. This panel, acting as an independent dispute resolution mechanism, aims to review and adjudicate claims made by individuals or entities asserting rights in the shares of the demutualized Exchange, now known as the Nigerian Exchange Group Plc.

In a recent statement, the Exchange highlighted that the Claims Review Panel would operate in an appellate capacity. It will be responsible for scrutinizing claims lodged by dissatisfied claimants who have contested decisions made either pre-demutualization by the National Council of the Exchange or post-demutualization by the Board of Directors of the holding company.

The central objective of the demutualization process is to transform the Exchange, which is currently operating as a company limited by guarantee, into a public company limited by shares. This strategic shift will enable the allocation of shares in the newly formed HoldCo to the existing members of the Exchange. As part of the transformation, the securities exchange license will be transferred to the Nigerian Exchange Limited, a wholly owned subsidiary of the HoldCo, which will be responsible for carrying out the securities exchange business.

The establishment of the Claims Review Panel is a crucial milestone in the ongoing demutualization process. By providing an impartial platform for the resolution of disputes concerning share ownership, the panel aims to foster transparency, protect shareholder rights, and instil confidence in the Nigerian Exchange Group Plc.

This move underscores the Exchange’s commitment to upholding the highest standards of corporate governance and fairness in its operations. As the Nigerian capital market embraces these structural changes, investors and stakeholders can look forward to a more robust and dynamic trading environment.

The Claims Review Panel represents a significant stride towards strengthening investor protection and regulatory compliance in the Nigerian financial market. It is expected that this mechanism will contribute to the sustained growth and development of the securities exchange sector, positioning Nigeria as a compelling destination for both domestic and international investors.

As the demutualization process continues to unfold, the Nigerian Stock Exchange reaffirms its dedication to fostering a thriving capital market that promotes inclusivity, transparency, and economic prosperity for all stakeholders involved. By ensuring that the rights of shareholders are diligently safeguarded, the Exchange remains steadfast in its pursuit of a more resilient and investor-friendly financial landscape for the nation.

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