Nigeria foreign company registration is the focal option by which a foreign entity/company can acquire a separate Nigerian legal personality and rightfully carry on business. A foreign company may also begin to operate as an ancillary business, such as an office representative, agency, subsidiary, or a foreign company branch in Nigeria. A company, however, of such nature shall be obligated to abide by certain laws mandating incorporation within a Nigerian subsidiary under local laws for the purpose of acquiring legal identity prior to commencing the business.
The legal framework for the incorporation of companies in Nigeria Companies and Allied Matters (CAMA) 2020 and the government commission that oversees incorporation is the Corporate Affairs Commission (CAC).
In the same vein, all foreign individuals who want to engage in any form of business in Nigeria are also mandated to incorporate a company and meet other requirements to set up a business in Nigeria as mandated by required laws.
A foreigner or foreign company cannot do business in Nigeria or vest any of the powers of a registered company unless such is incorporated.
STEPS AND REQUIREMENTS FOR A FOREIGNER TO DO BUSINESS IN NIGERIA
- Registration of the company with CAC under the CAMA
- Registration with Nigerian Investment Promotion Commission (NIPC)
- Tax registration and the nearest tax office to the registered address
- Obtainment of Nigerian Business Permit & Expatriate Quotas when an expatriate is immigrating to work in Nigeria or get Nigerian residency status.
- Obtain residence permit, also known as the Combined Expatriate Residence Permit and Aliens Card (CERPAC), when an expatriate is immigrating to work in Nigeria or become a signatory to Nigerian bank account.
- Obtaining an export certificate in case the registered business intends to export its products or raw materials out of Nigeria.
- Obtaining the necessary business license when the business intends to venture into a specialized sector that requires a government agency approval or permit.
Having presented the steps and conditions that must be followed or obtained for one to incorporate a company in Nigeria, we shall now briefly summarize or detail some of the notable points of the above requirements.
INCORPORATION OF A COMPANY WITH CAC
The first requirement for foreign business registration in Nigeria by a foreign individual or corporate entity, eager to conduct business in Nigeria is to incorporate a company according to the provisions of the laws. Foreign business engagement in Nigeria must start with the incorporation of a company with an authorized minimum share capital of N100,000,000 (One Hundred Million Naira). That simply means that the company must have at least 100,000,000 shares divided into 1 Naira per share. That does not mean that the said foreign person or entity is meant to deposit this amount at once to the government or any organization in Nigeria, it only suggests the extent of the risk and liabilities of the promoter towards the company.
In line with the CAMA 2020, one person can now register a Nigeria company.
Minimum Requirements for Nigerian Company Registration
Below are the regular and minimal requirements for registration of a Nigeria company:
- 2 proposed Names of the Company
- The Nature of main business the company shall engage
- Registered Office Address of the company
- Type of company to be registered: (Private or Public Company)
- Information of Director(s): (Name, Date of Birth, Gender, Telephone Number, E-mail Address, Identification documents- International Passport and signature).
- Information of Shareholder(s): (Name, Date of Birth, Gender, Telephone Number, Email Address, Identification documents- International Passport and signature on a plain paper),
- Shares percentage owned by each of the shareholders if the company shall have more than one shareholder.
- Company Secretary details (Company Secretary is not needed for a small company).
REGISTRATION WITH THE NIPC
The Nigerian Investment Promotion Commission (NIPC) is a Federal Government Agency in Nigeria established by the NIPC Act to promote, coordinate, and regulate all investments in Nigeria. The basic duties and authority of the NIPC are as laid out by the Act. The Commission among other things, coordinates, monitors, promotes, and provides necessary assistance and advice for the establishment and running of business firms in Nigeria.
BUSINESS LICENSE
A business permit is issued by the Ministry of Interiors and allows enterprises to carry out businesses in the government’s geographical area. It is the permit to start business for all foreign-owned companies, in particular a company that wants to buy expatriate quotas. A business permit is a working and permanent permit for a local enterprise operation of a company with expatriate investment as a subsidiary or branch of a foreign enterprise or otherwise.
Section 36(1)(a) and (b) of the Immigration Act (2015), and Paragraph 4 of the Immigration Regulations (2017) state that “no person other than a Nigerian citizen shall, in his own name or in partnership with any other person, follow a profession or begin or acquire any trade or business whatever or register or acquire any company with limited liability for any purpose without the written permission of the Minister of Internal Affairs”. The Minister of Interior Affairs’ approval is effected through a Business Permit.
EXPATRIATE QUOTAS
According to 36(1)(a) and (b) of the Immigration Act, 2015 a foreigner who is granted a business permit ought to be able to fall under the Expatriate Quota. A business permit allows a foreigner to work in Nigeria. However, all such firms that would like to employ foreigners ought to have an expatriate quota. Expatriate quota is the number of foreigners who can be employed by business firms working or desiring to work in Nigeria. This permit issued to this business firm is what is referred to as Expatriate Quota.
The quota position is attached to a specific post or position. Thus, the same expatriate quota can be utilized by various persons, provided it is still valid.
WORK PERMIT
The permit, which is also known as the Combined Expatriate Resident Permit and Alien Card (CERPAC) is required for working or expatriate residents in Nigeria. This thus confirms that an expatriate is able to obtain a residence permit that is valid for two years. The CERPAC allows a foreigner to remain in Nigeria and do business. However, the validity of a residence permit is dependent on the validity of the expatriate quota. A legitimate residence permit is also acceptable for re-entry into Nigeria.
SPECIALISED OPERATING LICENSE AND OTHER REQUISITE LICENSES
For organizations that wish to undertake operations in specialized sectors, acquiring operating licenses and other obligatory licenses from the concerned government agencies is necessary. Some of the government agencies include:
Nigerian Upstream Petroleum Regulatory Commission (NUPRC) – Oil & Gas Sector
Nigerian Communications Commission (NCC) – Telecommunications Section
Central Bank of Nigeria (CBN) – Financial Sector
Ministry of Mines and Steel Development (MMSD) – Solid Minerals Sector
National Agency for Food and Drug Administration and Control (NAFDAC) – Pharmaceuticals and Foods e.t.c
Briefly, any foreigner willing to do business in Nigeria must first incorporate his/her company with the Corporate Affairs Commission according to CAMA provisions. After incorporation, the firm then obtains a business permit from the Ministry of Interiors and NIPC registration. The expatriate quota and work permit will be obtained if the foreigner is willing to immigrate to work in Nigeria.