Given the interplay between the Land Use Act of 1978 and BOFIA 2020, how does the concept of 'ascertainable value' of a security asset intersect with the statutory limitations on l... Given the interplay between the Land Use Act of 1978 and BOFIA 2020, how does the concept of 'ascertainable value' of a security asset intersect with the statutory limitations on land ownership and transfer rights in Nigeria?
Understand the Problem
The question explores the relationship between Nigeria's Land Use Act of 1978 and the Banks and Other Financial Institutions Act (BOFIA) 2020, specifically focusing on how the statutory limitations on land ownership and transfer rights (as defined by the Land Use Act) impact the concept of 'ascertainable value' of a security asset used in banking transactions. It requires an understanding of both legal frameworks and their implications for valuing property used as collateral.
Answer
The Land Use Act's limitations on land ownership complicates determining the 'ascertainable value' of land used as security under BOFIA 2020, requiring careful valuation due to state control and transfer restrictions.
The interplay between the Land Use Act of 1978 and BOFIA 2020 affects the 'ascertainable value' of security assets by introducing complexities around land ownership and transfer rights. The Land Use Act vests all land ownership in the state, creating statutory rights of occupancy rather than absolute ownership. This limitation impacts the collateral value of land used as security for loans under BOFIA 2020, as the 'ascertainable value' must consider the state's overriding interest and potential difficulties in land transfer or foreclosure. BOFIA 2020 emphasizes risk management and collateral valuation for banks; hence, the interplay necessitates careful due diligence to determine the realisable value of land given the restrictions imposed by the Land Use Act.
Answer for screen readers
The interplay between the Land Use Act of 1978 and BOFIA 2020 affects the 'ascertainable value' of security assets by introducing complexities around land ownership and transfer rights. The Land Use Act vests all land ownership in the state, creating statutory rights of occupancy rather than absolute ownership. This limitation impacts the collateral value of land used as security for loans under BOFIA 2020, as the 'ascertainable value' must consider the state's overriding interest and potential difficulties in land transfer or foreclosure. BOFIA 2020 emphasizes risk management and collateral valuation for banks; hence, the interplay necessitates careful due diligence to determine the realisable value of land given the restrictions imposed by the Land Use Act.
More Information
The Land Use Act of 1978 has significantly shaped land ownership and transfer dynamics in Nigeria, creating a system where the government holds significant control over land resources.
Tips
A common mistake is overlooking the state's overriding interest in land when assessing its value as collateral. Always consider the potential difficulties in land transfer or foreclosure due to the Land Use Act.
Sources
- [PDF] Taxation, Property Tax, Land Use Act, Tax - SSRN - papers.ssrn.com
- [PDF] Legal Reform of the Land Use Act: Protection of Private Property ... - research.manchester.ac.uk
- [PDF] BANKING ON AFRICA – FINANCING TRANSACTIONS ... - Bowmans - bowmanslaw.com
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