The Securities and Exchange Commission has directed all public companies and registrars to stop classifying unclaimed dividends older than 12 years as “statute-barred,” particularly those issued before the enactment of the Finance Act 2020.
The Commission emphasized that this directive reinforces Section 60 of the Finance Act, which requires dividends unclaimed for over six years to be transferred to the Unclaimed Funds Trust Fund, where they remain available for shareholders to claim.
In a circular posted on its website, the SEC clarified that shareholders retain the right to claim dividends that were not statute-barred (i.e., not older than 12 years) before December 31, 2020, when the Finance Act took effect.
The circular stated: “The attention of the Securities and Exchange Commission has been drawn to the fact that paying companies and their Registrars have continued to treat unclaimed dividends of public companies that are older than 12 years as being ‘statute-barred’ without recourse to the provisions of the Finance Act 2020.”
It further explained: “In response to various inquiries on the subject, the Commission hereby clarifies as follows: The import of the provisions of Section 60 of the Finance Act 2020 (December 31, 2020), is that, where dividends declared by a public company quoted on the Nigerian Exchange Limited remained unclaimed for a period of six years or more, such dividends are expected to be transferred to the Unclaimed Funds Trust Fund to be held in trust and managed pending when the shareholder presents a claim for such unclaimed dividends.”
The SEC added: “Pending the setting up and operationalisation of the UFTF by the Federal Government, pursuant to its powers under Sections 3 (4) (e) and 93 of the Investments and Securities Act 2025, the Commission hereby directs public companies and their Registrars to continue to honour all requests by shareholders for the payment of unclaimed dividends as described above, with effect from December 31, 2020.”
The Commission mandated immediate compliance from public companies and registrars, requiring them to submit periodic reports on adherence to the directive as outlined in SEC’s Rules and Regulations.
