The Securities and Exchange Commission has instructed all public companies and registrars to stop rejecting shareholder requests for unclaimed dividends older than 12 years.
In a new circular, SEC clarified that dividends declared before December 31, 2020 must remain payable to shareholders, regardless of how long they have been unclaimed. This follows complaints that some companies were wrongly labeling these dividends as “statute-barred” (no longer valid).
“The Finance Act 2020 states that unclaimed dividends over six years old should be moved to a special trust fund, but they must still be available for shareholders to claim,” SEC explained. Until this trust fund is fully set up by the government, companies must continue paying out these dividends when requested.
Key points of the directive:
1. Dividends from before 2020 cannot be called “statute-barred” if under 12 years old
2. Companies must keep proper records of all unclaimed dividends
3. Regular reports must be sent to SEC showing compliance
SEC warned companies to immediately follow these rules, saying: “We’ve noticed some registrars wrongly refusing payment for old dividends. This must stop – shareholders have the right to claim what belongs to them.”
The move aims to protect investors’ money that may have been forgotten in company accounts. Many Nigerians lose track of dividends due to address changes, bank account issues or simply not checking records.
