Business Incorporation & Registration

Mandatory requirements

All businesses in Nigeria must be registered with the Corporate Affairs Commission before going formally into operation. Registration can take various forms as follows, depending on the type of business:

  • Private Limited Liability Company (Ltd)
  • Public Limited Company (PLC)
  • Unlimited Company
  • Company Limited by Guarantee
  • Subsidiary or Branch of a foreign company
  • Partnership or Joint Venture
  • Sole Proprietorship
  • Incorporated Trustees (religious, charitable, philanthropic or cultural)
  • Representative Office (in special cases)

A minimum share capital of Ten Thousand Naira (N10 000) is required to set up a private company (Limited Liability). For a Public Company (PLC), the required minimum share capital is five hundred thousand naira, (500,000 Naira). A minimum subscription of 25% of the authorised capital is also required at the point of incorporation.

Company Registration Process

Company Registration process has been streamlined and simplified to enhance efficiency and rapidity, with the establishment of the One-Stop Investment Centre (OSIC), located in the premises of the Nigerian Investment Promotion Commission (NIPC). Through the services of OSIC, companies can now be registered in a matter of days. However, companies which so wish can engage the services of a legal counsel to perform the registration formalities, although this may attract a substantial fee. The following are the main steps in the process of company registration:

  • Prepare the Memorandum and Articles of Association of the proposed company.
  • Conduct at the Corporate Affairs Commission availability search on the proposed name of the company; once the company name is approved, a set of incorporation forms should be purchased and filled; the registration of business name can be conducted without the assistance of a legal practitioner and attracts a fee of 10,000 Naira (Ten Thousand Naira).
  • Submit appropriate documents to the Federal Inland Revenue Service for payment of stamp duties and stamping
  • Submit the completed and stamped documents, together with the corresponding permits, to the CAC for verification and final approval
  • The Certificate of Incorporation is then issued, with the accompanying Certified True Copies of relevant documents, to the investor. All post-registration processes are done at the Head Office of the Corporate Affairs Commission (CAC) where all files are kept in safe custody and data entered on the CAC records.

Incorporating and operating a foreign company

Foreign companies wishing to establish and operate in Nigeria must accomplish required formalities for the local incorporation of the Nigerian branch or subsidiary, or autonomous business entity. Prior registration must be done before embarking on any business activity.

An investor may, however, give power of attorney to a solicitor for a limited period of time during which incorporation is being processed. This arrangement would then be indicated in the relevant incorporation documents, specifying that the solicitor, whose name appears therein, is merely acting as an “Agent” or “Principal”. The appointed solicitor ceases to function in the specified capacity upon the completion of the registration formalities.

The locally incorporated company must then register with the Nigerian Investment Promotion Commission (NIPC) before commencing formal operations. It may also apply to NIPC for other investment approvals (expatriate quota, etc.) and incentives ((Pioneer Status, etc.).

Exemption from Incorporation

Where applicable, exemption from local incorporation may be granted in accordance with Section 56 of the Companies and Allied Matters Act. Application to this effect should be addressed to the National Council of Ministers, through the Secretary to the Government of the Federation (SGF).

The National Council of Ministers eventually grants the exemption in the terms it deems fit. Below are the concerned categories of businesses:

  • Foreign Companies which are in Nigeria for the execution of a specific individual loan project on behalf of a donor country or an international organisation
  • Foreign government-owned companies engaged solely in export promotion activities;
  • Engineering consultants and technical experts on any individual specialist project under contract with any of the governments of the Federation or any of their agencies or with any other body or person, where such contract has been approved by the government.

Corporate Affairs Commission (CAC)

The Corporate Affairs Commission (CAC) was established by the Companies and Allied Matters Act (1990) as an autonomous body to regulate the formation and management of companies in Nigeria. The Commission dispenses a wide range of services before, during and after incorporation and registration of business enterprises. It administers the Companies and Allied Matters Act promulgated in 1990 and commonly called the “Companies Act”. It is headed by a Registrar General/ Chief Executive Officer. Among the functions and services offered by the Corporate Affairs Commission Headquarters are:

  • Registration of business name and incorporation of companies;
  • Registration of Incorporated Trustees;
  • Same Day Incorporation Services, whereby, under certain conditions, companies can be registered within one day;
  • Issuance of True Certified Copies of filed company documents;
  • Registration of share capital increases, mortgages, etc.;
  • Processing the statutory filings of Annual Returns, increase, changes in the memo and articles, addresses, etc.
  • Management and winding- up of companies.

The Corporate Affairs Commission has branch offices in all the 36 states of the Federation. It enjoys accreditation for ISO 9001 for its services.

Representative Offices

A foreign company may set up representative office in Nigeria. However, such an office can only serve as a promotional and liaison office and its local expenses have to be covered by the foreign company. It cannot engage in business activities or conclude contracts or open or negotiate any letters of credit.

Legislation on investment

Two principal laws govern investment in Nigeria, with emphasis on foreign investment:

  • The Nigerian Investment Promotion Act N° 16 of 1995;
  • The Foreign Exchange (Monitoring and Miscellaneous Provisions) Act N°17 of 1995.

The functions of the Nigerian Investment Promotion Commission (NIPC), as stipulated by the NIPC Act 16, 1995, are wide-ranging and include coordinating, monitoring, encouraging and providing necessary assistance to and guidance for the establishment and operation of businesses in Nigeria. The NIPC is also to promote investment in and outside Nigeria through effective means. The highlights of the above- mentioned Acts (N°16 and N° 17 of 1995) with regards to investment are as follows:

  • A foreigner may invest and participate in the operation of any enterprise in Nigeria;
  • An enterprise in which foreign participation is permitted shall, after its incorporation, be registered with the NIPC;
  • A foreign enterprise may buy shares of any Nigerian enterprise in any convertible currency;
  • A foreign investor in a registered enterprise is guaranteed unconditional transferability of funds through an authorised dealer, in any convertible currency, be it: – dividends or profit (net of taxes) attributable to the investment; – payments in respect of loan servicing, where a foreign loan has been obtained; – proceeds (net of taxes and other obligations) in the event of sale or liquidation of enterprise or any interest attributable to the investment; – the entire capital can be transferred should the investor decide to relocate elsewhere.

Investment Protection

The legislation on investment also provides solid assurance regarding the protection of investment.

It guards against nationalisation or expropriation of an enterprise by the government and the compulsory dispossession of an investor of his/her interest in the capital of an enterprise, whether wholly or in part.

It guards against the acquisition of an enterprise by the government unless such an acquisition is in the best interest of a public purpose, in which case, adequate compensation must be paid promptly, with authorisation for full repatriation of the proceeds in convertible currency, where applicable. The law also gives the investor the right of access to the courts for determination of his/her interest or right and the compensation to which he/she is entitled.

Investment Promotion and Protection Agreements

Countries willing to invest in Nigeria may choose to enter into bilateral Investment Promotion and Protection Agreement (IPPA) with the Nigerian government.

Deregulation of Equity Structure in Nigerian Enterprises

The Nigerian Investment Promotion Commission (NIPC) Act N° 16 of 1995 has effectively abolished any restrictions in respect of the limits of foreign shareholding in an enterprise registered in Nigeria.


However, certain categories of enterprises remain subject to authorisation for non-Nigerians:

  • Production of arms and ammunition;
  • Production of and dealing in narcotics and psychotropic substances;
  • Manufacture of military and paramilitary wears and accouterments;
  • Participating in coastal and inland shipping.