Component of the cap-binding complex (CBC), which binds co-transcriptionally to the 5' cap of pre-mRNAs and is involved in various processes such as pre-mRNA splicing and RNA-mediated gene silencing (RNAi) by microRNAs (miRNAs). The CBC complex is involved in miRNA-mediated RNA interference and is required for primary miRNA processing. In the CBC complex, CBP20 recognizes and binds capped RNAs (m7GpppG-capped RNA) but requires ABH1/CBP80 to stabilize the movement of its N-terminal loop and lock the CBC into a high affinity cap-binding state with the cap structure. CBP20 also plays a role in stabilization of ABH1/CBP80 and ABH1/CBP80 localization to the nucleus. Involved in flowering regulation via its interaction with FRIGIDA. Component of the nuclear cap-binding complex (CBC), a heterodimer composed of ABH1/CBP80 and CBP20 that interacts with m7GpppG-capped RNA. Interacts with FRIGIDA; the interaction is direct. Predominantly nuclear. Expressed in all tissues analyzed, including roots, stems, leaves and flowers. Hypersensitivity to abscisic acid during germination, significant reduction of stomatal conductance and greatly enhanced tolerance to drought. Plants also display mild developmental abnormalities, such as serrated rosette leaves, delayed development and slightly reduced stature. In contrast to other organisms, the CBC complex is apparently not essential for nonsense-mediated mRNA decay (NMD) in Arabidopsis. Belongs to the RRM NCBP2 family.