Nigeria's CAMA Killed Authorised Share Capital.
Why That Matters for Startup Equity
The Companies and Allied Matters Act (CAMA) 2020 eliminated Authorised Share Capital (ASC) from Nigerian corporate law. On paper, this looks like a cleanup — a simplification. But for startups and their investors, the impact is structural. It quietly broke the scaffolding most venture deals relied on to function.
Vesting schedules. Option pools. SAFEs. Convertible notes. Preferred share conversions.
All of these depend on the ability to promise future equity — equity that doesn’t exist yet but is expected to.
But under the new CAMA regime, no shares legally exist unless they are issued and allotted to a named individual, with a supporting board/shareholder resolution and CAC filing. There is no legal concept of “reserved” shares. You cannot issue phantom equity. You cannot increase your share capital “in advance” of knowing who will receive the shares.
This has direct consequences for nearly every standard startup equity mechanism in Nigeria.