Appeal Court Orders CAC To Remove KPMG Professional Services From Register

The Court of Appeal sitting in Lagos has ordered the Corporate Affairs Commission (CAC) to remove the business name “KPMG Professional Services” from its register, ruling that the name is too similar to that of the established audit, tax, and consulting firm, KPMG Nigeria. 

Justice Abdullahi Mahmud Bayero, who delivered the unanimous verdict on behalf of the panel, also issued a perpetual injunction restraining “KPMG Professional Services” from conducting any business under that name going forward.

The appellate court ruled that the registration of the second respondent’s business name was “improper and misleading”in violation of Section 662(1)(d) of the Companies and Allied Matters Act (CAMA) 1990, now known as Section 852 of CAMA 2020. KPMG Nigeria, which encompasses its audit, tax, and consulting divisions, had filed an originating summons in 2002, challenging the CAC’s registration of “KPMG Professional Services” on the grounds that the name was deceptively similar to its long-established corporate identity.

However, in 2005, the Federal High Court dismissed KPMG Nigeria’s suit, reasoning that an alleged merger between KPMG Nigeria and Akintola Williams Deloitte meant that the plaintiff no longer retained rights to the disputed name. The lower court further upheld the second respondent’s counterclaim and ordered that KPMG Nigeria’s name be struck off the CAC register.

The Court of Appeal, however, rejected this ruling, describing the evidence of the alleged merger as “inadequate and unsubstantiated.” The appellate court noted that the newspaper articles relied upon by the lower court were insufficient proof of a legal merger and did not establish that KPMG Nigeria had ceased to exist or forfeited its rights.

Justice Bayero clarified, “It is only a merger agreement that can determine the nature and scope of the purported merger. What exists here, at best, is a functional collaboration or partial merger of only a component, KPMG Audit, and even that is not proven by binding legal documents.”

The appellate court further held that KPMG Nigeria was the first to register its various business entities, including KPMG Audit (1969), KPMG Tax Consultants (1990), and KPMG Consulting, and faulted the CAC for acting contrary to CAMA by registering a similar name without first removing the earlier existing registrations.

“The Registrar cannot assign a business name already held by another entity. One cannot give what one does not have, nemo dat quod non habet,” stated the court.