Simple Guide for Foreigners on How to Start a Business in Nigeria
As it is today, we have seen the upsurge of increased foreign companies that have come to domicile their businesses here in Nigeria. This have made the country a holistic corporate coalition of diverse business running operation within and outside the country. We can’t deny the intrinsic value these companies have created in our dear nation which have led to the development of industries, corporations, firms etc. One good thing about this whole thing is that, it has created competition and therefore we have seen the rise of new and aspiring business elites.
Before now these ordinary citizens would not even think of starting up their own business but today, it’s a changed story. Because of the vast business opportunities found here in Nigeria being the most developed economy in Africa, been the largest in Africa in population and been the center of business hub in the continent, we have seen the increased influx of foreign companies into Nigeria as though we are experiencing a mass exodus from Egypt to Canaan land.
If you remember vividly well in 2016 when we had our worst year in financial sector due to the unprecedented share of industrial tragedies, the nation’s government have been working tirelessly to ensuring a very stable and stealthy recovery process of the aging and once dying Economy of the great black Nation. Now the government is encouraging people both afar and near into investments by pumping allot of resources into infrastructure and this is where foreign investors are very sensitive. And this they have seen as their jackpot to invest into our developing economy. They have also seen that with a case like this, market penetration will be so so easy and not made difficult at all.
Why is Nigeria a Healthy Investment ground for Foreigners entities?
- Supportive Legal Structure
Some time ago we all witnessed the plenary session of the House of Representatives who passed the Companies and Allied Matters Act (Repeal and Re-Enactment) Bill. Well for those who may not understand what this is all about, I will explain. But first, we all remember that in 2018, 15th May to be precise, the red chambers (Senate house) passed a similar bill and this bill is all about the document is a proclamation that contains several relevant provisions in the context of Nigerian company law. This new bill actually stipulates a simple rule and amendment on the legal ground on how a foreign company or foreign investment company can have an entry and exit into and fro from the Nigeria business market without facing and unnecessary demands. With this in mind, these foreign companies don’t need
to think their head out about company incorporation procedures and market penetration and in any case, these foreign company revaluation and wrap up procedures won’t be necessary anymore.
- Newly Emerging Sectors
It is on record that Nigeria is one of the largest oil Nations in the world. Infact it is highly stated that it has the second largest fuel reserve in the world. This is mind bugling. With this, obviously we are
tagged and seen as a fuel nation because we depend almost solely on oil (crude). But over time, we have seen new business sector on the rise. We have also seen that consumer market have started embracing companies with diverse company products that have made life very simple and going. These companies have been able to achieve via their various types of products and services. Let’s list the various new and emerging business that changing the entire scene of the old fashion lifestyle of many consumers in Nigeria. They are :
Oil and Gas
Construction Infrastructure Development
Construction material retail
Packaged Fruit Beverage
- Ease of Networking
Now we operate an ecosystem business pattern in Nigeria by cohesively partnering and networking each other by one way or the other. This has led to a very much positive coalesced industrial revolution and growth in the country. We can see the impact of this development across some sectors of the economy which have created a foundation of trust for various partners in the sector like, joint ventures and those who are investors. You will agree with me that these Networking facilities available have been a major positive reason why foreign entities who have entered into the country can easily socialize with various forms and also actively grow towards a very more versatile developing company like ours.
- Incentives for Foreign Nationals
The last but not the least here mentioned above. As a foreign business entity in Nigeria, government usually provide special incentive to them. This enables them to facilitate their very much positive operations and corporation here in Nigeria for the duration of period they will be staying. Be it short or long periods. These incentives are legislative in nature. Quick procedure for business incorporation Flexible immigration and business permit provision.
A structured legal process for repatriation of Capital and Interest Unlike in some countries, except for a few special businesses that significantly involve the government, foreign nationals are under the
Constitution to own a100% stake of their shares of their respective limited liability companies as long as they can do that without having any issues with the financial institution of Nigeria.
Business Registration in Nigeria
- The first and most important thing to do is to check for the availability of a company name on the website of the corporate affairs commission (CAC) to ascertain that your preferred company name is still very much available.
- At this point, you will be required to fill a form CAC 1.1. This form will provide you questions that will require you to provide some specific Information the internal details of the company. For examples are – the status of authorized share capital and details of the directors and the shareholders that’s for a partnership entity.
- You are to create the Memorandum of Association (MOA) and Articles of Association (AOA), which includes the following – company objectives, shares which are issued to each of the directors on board. After this, the document needs to be signed by at least one witness. You don’t have to go far looking for one. You can use the secretary of the company who at times happens to be the legal representative of the company.
There are certain amounts of money you are to pay as a prerequisite for your company name registration. It is a fixed price and it’s all on the website. This fee should be made only to CAC as registration fee and stamp duty. And this stamp duty will be dependent on the type of company/business entity and the volume of your share capital of the business. Please also note that the CAC 1.1 and the MOA and also the AOA must be duly stamped and signed by the directors, shareholders of the company including a company witness(s) and an authorized CAC agents must be present and must sign. Every document after been dull filled, stamped and signed must be scanned, signed and submitted online. Below is the manner at which it could be done:
Form CAC 1.1 duly filled
MOA and AOA of the company
Name availability notification from CAC
Identification proof of all the stakeholders
Details of Legal Practitioner/Company Secretary
The CAC receipt for payment of registration fees
After the filling and submission of form online, it will take a minimum of three days to be officially analyzed because the official cross examination of the documents can be a very tedious one and cal also be very comprehensive too. When CAC is done with the verification and approval or any related issue, you will be notified via your email. If your business name and documents have been approved, you will be receiving a notification along with your company’s RC number. With this, companies can start fully operating in Nigeria as a legal entity. But you are to register via the company secretary through the Nigeria taxation commission for taxes. This they are obligated to do.
Now you are set to begin operation in Nigeria. But let me quickly do this. If you are looking for a particular profitable business to do in Nigeria, then we are your best shots. Contact us today or place your order on any of our various businesses plans and you will be glad you did.
You can contact us via our email address at email@example.com or call and whatsapp us on