06/04/2017
DOING BUSINESS IN NIGERIA- A GUIDE TO FOREIGN PARTICIPATION
In a bid to ease the hurdles associated with Doing Business in Nigeria , the Presidential Enabling Business Environment Council (PEBEC) recently approved a 60-day national action plan to be implemented across three priority areas – Entry and Exit of goods; Entry and Exit of people and Government Transparency and Procurement. We have since started seeing some of the effects of this plan especially at the Corporate Affairs Commission and Nigerian Customs Service.
These efforts are part of the holistic plan to declare Nigeria open for business and to attract the much needed foreign investment which would in turn buffer our economy. This article is first in a series that focuses on how foreigners can invest in Nigeria and the aim is to provide guidance on all aspects of Doing Business in Nigeria i.e. Business Formation, Capital Importation and Repatriation, Technology Transfer, Intellectual Property Protection, Immigration Policies and Dispute Resolution.
BUSINESS FORMATION:
An alien or foreign company may join in forming a company subject to compliance with the provisions of the laws regulating the rights and capacity of aliens to engage in business in Nigeria. Every foreign company intending to carry on business in Nigeria must take all necessary steps to obtain incorporation as a separate entity in Nigeria and until so incorporated, the foreign company shall not have a place of business in Nigeria for any purposes other than the receipt of notices and other documents as matters preliminary to incorporation. However, a foreign company may apply to the Federal Executive Council (FEC) for exemption from the requirement to register locally if it belongs to one of the following categories. That is:
• Foreign companies invited to Nigeria by or with the approval of the Federal Government to execute any specified loan project;
• Foreign Companies, which are in Nigeria for the ex*****on of, specified individual loan project on behalf of a donor country or international organization;
• Foreign government owned companies engaged solely in export promotion activities; and
• Engineering consultants and technical experts engaged on any individual specialist project under contract with any of the governments in the federation or any of their agencies or with any other or person where such contract has been approved by the Federal Government.
Ultimately, a foreigner can fully participate in the operation of any enterprise in Nigeria except enterprises in the negative list (which largely relates to the manufacturing of fi****ms and other military materials). The foreigner may operate alone or in Joint venture with Nigerians by means of a company, which has to be formed and registered with the Corporate Affairs Commission (CAC) and with the Nigerian Investment Promotion Commission (NIPC).
PROCESS OF REGISTERING A BUSINESS IN NIGERIA (LIMITED LIABILITY COMPANY)
• Check for availability of proposed Company name
• Reserve the approved Name
• Complete pre-registration form – CAC1.1 and prepare Memorandum and Articles of Association.
• Pay Stamp duty fee to Federal Inland Revenue Service.
• Pay filing fees to Corporate Affairs Commission.
Submit all documents including Form CAC1.1; Memorandum and Article of Association; Proficiency certificate; Recognized form of identification for Director(s)/Subscriber(s) and Secretary; Stamp duty receipt; Evidence of payment to Corporate Affairs Commission.
LAWS REGULATING REGISTRATION OF BUSINESSES IN NIGERIA
The following laws have to do with different aspects of foreigners participating in business in Nigeria:
1. Companies and Allied Matters Act
2. Investment and Securities Act;
3. Nigerian Investment Promotion Commission Act;
Nigeria is blessed with abundant human/natural resources and thus the Country is an obvious destination for investment capital. Whilst the potentials are huge for foreign companies intending to do business in Nigeria, however understanding how to navigate the hurdles associated with this environment is germane to survival. We have explained in detail some of the requirements for registering a Limited Liability Company in Nigeria however it is advisable to work with the right professionals to better navigate the Nigerian business space.
Source: IOC
http://www.myaccessafrica.com/index.php/services/company-registration
