How To Start A Company From The Scratch in Nigeria (Complete Requirements). This post is intended to assist business persons, particularly Micro, Small, and Medium Scale Entrepreneurs, in navigating the legal and regulatory aspects associated with beginning a company in Nigeria. Take the following steps.
Table Of Contents
- 1 Introduction
- 2 TYPES OF REGISTRABLE ORGANIZATIONS IN NIGERIA
- 3 HOW TO START A COMPANY IN NIGERIA
- 3.1 1. NAME RESERVATION
- 3.2 2. APPLY FOR THE APPROVED NAME
- 3.3 3. PREPARE AND FILE THE ARTICLES OF INCORPORATION OF THE COMPANY
- 3.4 4. REGISTER WITH THE TAX ADMINISTRATION
- 3.5 5. SELECT THE DIRECTORS
- 3.6 6. SEARCH FOR A BUSINESS OR OFFICE LOCATION
- 3.7 7. PUBLISH EMPLOYMENT CONTRACTS
- 3.8 8. APPLY FOR A BUSINESS PERMIT AND EXPATRIATE QUOTA
- 4 Conclusion
When selecting how to enter the Nigerian market, you must pick between forming a new firm and acquiring an existing one. A number of business structures are available when starting a new firm. Sole proprietorships, partnerships, incorporated trustees, and corporations are the four primary forms. You must choose the company structure that will best meet your organization’s demands. The cost, tax, legal, regulatory, and financial risk ramifications will be determined by the business structure. Your predicament may necessitate the services of a Solicitor.
Everyone wants more visits, quality leads, and income. Starting a business, on the other hand, isn’t one of those “if you build it, they will come” situations. So much of getting a business off the ground is about time, strategy, and the market, so think about whether the economic conditions are ideal to start a firm and whether your product can effectively penetrate the market.
To construct and operate a successful business, you must also design and fine-tune a business strategy, examine your finances, complete all legal documentation, select your partners, investigate applications for startup growth, and select the finest tools and systems to help you get your marketing and sales off the ground.
TYPES OF REGISTRABLE ORGANIZATIONS IN NIGERIA
Registrable business organizations in Nigeria include:
1. A company limited by shares (Ltd or Plc)
2. A company limited by guarantee (Ltd/Gte)
3. An unlimited liability company (Ultd)
Any of the above companies may be a Private Company or a Public Company.
4. Business Name (registered as Sole Proprietorship or Partnership)
5. Incorporated Trustees (usually formed for not-for-profit or charitable purposes)
HOW TO START A COMPANY IN NIGERIA
1. NAME RESERVATION
You can only use a name that is not the same as that of an already registered organisation in Nigeria. To check if the name is accessible for usage, a name availability search must be performed at the Corporate Affairs Commission (CAC) register. It will be approved for registration where it is available. Within 24 hours, you may verify name availability and make a reservation.
2. APPLY FOR THE APPROVED NAME
In Nigeria, businesses must be registered with the Corporate Affairs Commission as either a Business Name or a Company. Foreign investors wishing to enter the Nigerian market may desire to form a new Nigerian business or a new Nigerian subsidiary that acts as a separate legal entity from the offshore parent firm.
3. PREPARE AND FILE THE ARTICLES OF INCORPORATION OF THE COMPANY
Companies must have a Memorandum of Association and Articles of Association (MEMART), which a CAC accredited Solicitor can help you draught to suit your business objectives and file a copy of same at the Corporate Affairs Commission (“CAC”) registry; pay stamp duties on the incorporation deeds, and register the company as a legal entity. The MEMART of the Company or the Partnership Deed of the Firm Name will address ownership and management concerns as well as the regulations controlling how the business is operated. The deed will define the essential concerns and outline any limitations on what the company may do and how decisions will be made.
4. REGISTER WITH THE TAX ADMINISTRATION
Corporate and personal taxes are collected by the Federal Inland Revenue Service (FIRS) and the State Board of Internal Revenue, respectively. Every company, business name, or incorporated trustee must be registered with the FIRS and get a Tax Identification Number (TIN) and Value Added Tax (VAT) Number, as well as prepare and present the Annual Return in required formats to CAC within the time frame specified.
5. SELECT THE DIRECTORS
The directors are a company’s shadow and the core of corporate governance. A company’s directors might be either foreign or Nigerian, and they can be either resident or non-resident.
6. SEARCH FOR A BUSINESS OR OFFICE LOCATION
If you are seeking to buy or lease a company or office space, a Solicitor can advise you on your alternatives. In Nigeria, land acquisition and development are finalised at the state or local government office where the land is located. State jurisdictions may have different requirements for approvals, evaluations (including environmental and structural studies), and other regulatory requirements.
7. PUBLISH EMPLOYMENT CONTRACTS
To prevent future legal problems, use the services of a Solicitor to write employment contracts and workshop manuals for your workers (or addendums for personnel outside Nigeria) and to ensure compliance with the provisions of the Labour Act.
8. APPLY FOR A BUSINESS PERMIT AND EXPATRIATE QUOTA
Lex Artifex, LLP. can help international investors and firms get a Business Permit and an Expatriate Quota from the Nigerian Investment Promotion Commission (NIPC) and the Nigerian Immigration Service, respectively. Expatriate staff do not need work permits, but they are subject to their employer’s requirements quota, which requires them to get residence permits that allow income repatriation overseas.
Nigeria has a stock exchange, which provides access to long-term finance. To get and maintain an NSE listing, your firm must fulfil the conditions outlined in the stock exchange listing guidelines. This includes obligations for corporation disclosure and reporting.
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