There are over 200 nations and territories across the world today. Each nation possesses distinct laws that guide its process for efficiency. This theory also applies to the corporate laws made by a country, with citizens of nations demanding the most effective legal structures possible.
The globalization drive across the world has added to the increased impact derived from its benefits. Companies can now have their headquarters in a nation and can operate in other nations of the globe. Nonetheless, for a company to operate in a nation, such a company must comply with the nation’s regulatory framework for registration and doing business.
This work offers the steps for foreign companies’ registration in Nigeria.
How a foreign company is registered in Nigeria
1. Incorporation with the Corporate Affairs Commission (CAC)
The CAC is Nigeria’s principal body charged with the responsibility of registering companies. Whether foreign or locally owned. For foreign countries to operate in Nigeria, they first must register as a Nigerian entity.
The provisions of the Companies and Allied Matters Act (CAMA) guide the process for the registration of foreign companies in Nigeria, a foreign company must also have a minimum share capital of 10 million Naira.
Some companies can be exempted from registration under the CAMA, these companies are:
- Technical and engineering consultants working on any individual project for the government or any private person in Nigeria, subject to the consent of the Federal government;
- A foreign company called to execute a project in Nigeria, subject to the Federal government’s consent;
- Export promotion companies owned wholly by the government of a foreign country; and
- Foreign companies in Nigeria for the execution of a specialized individual loan project sponsored by a foreign country or an international organization.
To benefit from exemption under CAMA, companies must make applications to the Federal government through the secretary of the federation.
2. Business permits
Business permits are usually issued by the Federal Ministry of Interior. The business permit is highly significant for foreign companies that are wholly owned by foreigners seeking to do business in Nigeria. Also, business permits would be vital to foreign companies seeking to drag expatriates into the country, whether or not such a company is wholly foreign-owned.
To apply for business permits, foreign companies must provide the following:
- The immigration form T/1;
- The certificate of incorporation in Nigeria;
- The Nigerian registered memorandum and articles of association;
- Application for the registration of a company issued by the CAC;
- Joint venture, shareholders’ Agreement or partnership venture between foreigners and Nigerians, if any;
- Tax certificate evidencing registration at the Federal Inland revenue service (FIRS); and
- The feasibility report registered with the CAC.
3. Expatriate quota
The expatriate quota is the authority in writing given to a foreign company registered in Nigeria to employ foreign experts in the country. The expatriate quota specifies the number of experts to be employed by the foreign company and the conditions upon which the experts and the company must comply.
An expatriate quota must never be mistaken for a visa or permit to work in Nigeria, rather it is consent for a company to employ foreigners in its establishment.
Once a foreign company has been issued an expatriate quota, the company can allocate some of that quota to its foreign employee.
The employee in turn can proceed to acquire the Combined Expatriate Residence Permit and Aliens Card (CERPAC) which is an expatriate green card issued to work in Nigeria. The expatriate can also apply for a work permit from immigration to work in a foreign company.
4. Work permit
Work permits are permissions to experts and other foreign workers seeking to work in the country. The major work permit for foreigners is the CERPAC, all foreigners willing to work in Nigeria must apply for and hold CERPAC. CERPAC is valid for 2 years and can be renewed by the Federal government.
CERPAC classifies all immigrants except immigrants from the Economic community of west African States (ECOWAS). ECOWAS citizens are entitled to work and do business in Nigeria for 5 years which is renewable, subject to a valid ECOWAS or national visa. An ECOWAS citizen does not require CERPAC to work as an expert in Nigeria.
5. Immigration requirements
Other requirements from the Nigerian Immigration Service, include resident permits for experts to reside in Nigeria; temporary work permits which last for three months, these permits are aimed at workers who intend to undertake temporary work in Nigeria. These permits must be applied for by immigration.
Recommended: How to allot Shares in a Company (Nigeria)
6. Certificate of Capital Importation (CCI)
The CCIs are issued to foreign companies that offer a direct investment into the Nigerian market. When a foreign company registers, it immediately gets a Dollar account and imports capital for its Nigerian establishment, the Central Bank of Nigeria (CBN) would issue a CCI through the collecting commercial bank or financial institution.
7. The Nigerian Office for Technology Acquisition and Promotion (NOTAP)
NOTAP is the agency that registers the introduction of innovations or technologies into the Nigerian market.
If a company introduces an innovation that ordinarily was not in the Nigerian market, such invention must be registered with the NOTAP. Innovations include secret recipes, technologies or unique creation styles.
8. One Stop Investment Centre (OSIC)
OSIC was established by the government to cut the unnecessary bureaucracy in establishing a foreign-owned business in Nigeria. Foreign companies in the past interfaced with over 10 agencies just to register their presence in Nigeria, for instance, foreign companies interface with the CAC, the FIRS, immigration, The Nigerian Investment Promotion Council (NIPC) the CBN, the Ministry of Interior, the Nigerian Customs, The NOTAP, the list is endless.
The OSIC was created to fuse or join all functions of the various agencies into one body. Foreign companies intending on incorporating in Nigeria need not interface with all but would interface with one agency and get all services accomplished.
The registration of a foreign company in Nigeria can be a tedious task, but it is worth the stress, following the fact that Nigeria is the most populated country on the African continent, has the largest economy and has the highest number of middle-income earners in Africa by population.
Frequently Asked Questions (FAQs)
No, OSIC is strictly formed for the registration of foreign business enterprises in Nigeria.
The letter of exemption for incorporation must be submitted to the Office of the Secretary to the Federation.