Doing business in Nigeria or anywhere in the world begins with the registration of business. Although business registration in Nigeria has been simplified by Nigeria’s Corporate Affairs Commission(CAC) over the years. CAC online company registration has greatly increased the process by which a company can be registered in swiftly Nigeria. Company registration in Nigeria online is now faster and efficient compared to the former manual process. Subsequently, most payment for company registration such CAC filing fees and stamp duty fees cannot be processed now.
There are different types of company formation allowed under Nigeria’s company law. Therefore, several people seeking to do business in Nigeria, especially for the first time, often want to know how to register a company in Nigeria or how to register a business in Nigeria
Limited Liability Companies are the most widely used form of business enterprise in Nigeria. Private Limited Liability Company has several advantages, which include but limited to perpetual succession, limited liability, separate legal personality among others.
The procedure for foreign company registration in Nigeria is almost as the same as the procedure for domestic company registration for Nigerians except for a legal requirement that a company with foreign participation in Nigeria must be capitalized with the minimum of N10 Million.
A company is a legal entity and required to be duly incorporated. Company registration in Nigeria falls under the Companies and Allied Matters Act 2004 (CAMA). Corporate Affairs Commission is the sole agency of government responsible for incorporation of companies in Nigeria pursuant to provisions of CAMA.
Section 18 of the Companies and Allied Matters provides that it takes at least 2 persons to form a company. Section 246 of same Act mandates every company registered in Nigeria to have or maintain a minimum number of 2 directors.
Having regards to the above, it is very clear to state that a single entity cannot own a company in Nigeria.
The procedures for company registration in Nigeria are as follows:
- Any person proposing to register a company is advised to speak to a consultant, especially a corporate lawyer. Although CAC has made good efforts through online registration to ensure individuals are able to register companies online themselves, but the services of accredited lawyers are still requested for attestation of the incorporation documents. The following information must be furnished for a lawyer to proceed with a company registration in Nigeria:
- Particulars of the name of the proposed company (two names are to be submitted by the client: the proposed name of the company and an alternative name). The proposed company’s name must not be a prohibited or restricted name under the law.
- Particulars of the type of company to incorporate, which is usually private or public company limited by shares.
- Particulars of the object of the proposed company.
- Particulars of the registered office address of the proposed company.
- Particulars of the authorized share capital. (i.e. how shares will be divided among the founders)
- Particulars of the first directors of the company.
- Particulars of the first subscribers to the Memorandum and Article of Association of the proposed company.
- Particulars of alien participants, if any.
- Particulars of the matter to be provided for in the Article of Association.
- The availability check and reservation of name of the proposed company must be conducted with the Nigerian company’s registration agency, Corporate Affairs Commission (CAC).
- The consultant or lawyer prepares the necessary incorporation documents and completes the incorporation forms obtained from the CAC. The incorporation documents include:
- Duly verified particulars of the director and statement of share capital known as CACForm 1.1
- Duly signed and sealed resolution of the company authorizing the subscription, where a new company’s subscriber wishes to subscribe to the memorandum and articles of association (MEMART). I.e. join in the formation of the company.
- Duly stamped Memorandum and Articles of Association
- The individual completes all the incorporation documents with the input of an accredited lawyer to duly attest to the incorporation documents.
- The payment of the prescribed fees will now be duly made online and the incorporation documents immediately stamped online.
- The stamped incorporation documents will now be duly uploaded into the CAC online portal again for the final review of the commission
- If all the incorporation documents are well completed and executed, the commission will incorporate the company and issue an incorporation number immediately online.
- Certificate of Incorporation and the Certified True Copies of the other documents will be issued by CAC and received by the consultant or lawyer, usually in less than 48 hours after the company is duly incorporated by CAC
However, the cost of company registration in Nigeria depends on the number of shares capital of the company. The higher the share capital of a company, the higher the fee/ stamp duty payable to the government.
In conclusion, it is better to register a limited liability company as against other forms of companies as it holds several benefits and easy to register. More so, foreigners are allowed to fully own a company under the Nigerian law.
Finally, the entire process of company registration in Nigeria with CAC can be completed within 48 hours if all the necessary incorporation documents have been put in place.
Written by Corporate & Commercial Law Department at Resolution Law Firm, Nigeria