As Africa’s largest economy and most populous country, Nigeria attracts numerous international businesses seeking expansion. To operate legally, foreign companies must navigate a structured registration process, which includes obtaining key permits such as a Business Permit, Nigerian Investment Promotion Commission (NIPC) Registration, Expatriate Quota, and Resident Permit (for residency). Here, we provide an updated, FAQ guide to help simplify foreign company registration in Nigeria and address the most common queries for foreign investors.
Frequently Asked Questions (FAQs) on Foreign Company Registration in Nigeria
1. Can a foreigner register a company in Nigeria?
Yes, foreigners can legally register and own a company in Nigeria, making it possible for international businesses to establish and run their operations within the country’s borders.
2. Are there exemptions for certain foreign companies from registering in Nigeria?
Yes, some companies can apply for an exemption, including:
- Companies invited by the Federal Government for specific projects.
- Companies executing loan projects on behalf of international organizations or donor countries.
- Foreign government-owned entities focused solely on export promotion.
- Specialized engineering or technical experts on government-approved projects.
3. What are the prerequisites for a foreigner to start a business in Nigeria?
In addition to Corporate Affairs Commission (CAC) registration, foreigners must register with the Nigerian Investment Promotion Commission (NIPC) and, if they plan to live in Nigeria, must obtain a Business Permit from the Ministry of Interior.
4. What are the required documents for foreign company registration?
The following documents are essential:
- Company name and nature of business.
- Registered Nigerian address.
- Director and shareholder information.
- Secretary details and share allocation.
- Signatures of directors, shareholders, and secretary.
5. Do I need a Nigerian on my company’s board?
Generally, there is no legal requirement to include a Nigerian on the board. However, certain sectors—such as Oil & Gas—may require local representation to meet industry-specific local content requirements.
6. Can a foreign-registered company use a foreign address?
No, a Nigerian-registered office address is required. A physical presence helps in regulatory compliance and enables the company to meet local tax obligations.
7. Can a foreigner be the sole director and secretary?
No, Nigerian law mandates at least two directors and two shareholders for foreign-owned companies. Foreigners can be directors but cannot be appointed as the company secretary. Kudi Konsult offers nominee director and company secretarial services to facilitate this requirement.
8. What is the minimum share capital requirement?
For companies with foreign ownership, the minimum share capital is set at NGN 100 million, ensuring the company meets regulatory requirements for international business participation.
9. What documents will I receive upon registration approval?
With online registration, foreign companies receive:
- An e-Certificate of Incorporation.
- Memorandum and Articles of Association.
- Status Report for the registered entity.
10. What are the tax obligations for foreign companies?
Registered foreign companies are subject to Corporate Income Tax (CIT) with rates managed by the Federal Inland Revenue Service (FIRS). Large companies (gross revenue over NGN 100 million) are taxed at 30% on profits from the preceding fiscal year.
11. Can foreigners register a sole proprietorship?
No, sole proprietorships (business names) are only available to Nigerian citizens or legal residents.
12. How do I handle corporate bank accounts?
Kudi Konsult partners with leading Nigerian banks to streamline corporate account openings for foreign entities. Companies must obtain a Bank Verification Number (BVN), which can be acquired at Nigerian embassies or selected international locations.
13. Is NIPC registration required, and what are the benefits?
Yes, NIPC registration is mandatory for foreign-owned companies. The main benefits include:
- Legal Protection: The NIPC Act prevents expropriation or nationalization of registered foreign companies.
- Investment Incentives: Eligibility for investment incentives and sector-specific benefits designed to encourage foreign investment.
14. What is required for NIPC registration?
The following documents are typically needed:
- Certificate of Incorporation.
- Memorandum and Articles of Association.
- CAC Form 1.1 with director details and shareholding structure.
- Business activity description.
- Investment details (including structure, proposed staff, and investment value in USD).
15. Are there other requirements to operate in Nigeria successfully as a foreign business?
Yes, additional licenses or permits may be required depending on the industry. Examples include:
- Business Permit and Expatriate Quota for employing foreign staff.
- Residence Permit for expatriates living in Nigeria.
- Industry-specific licenses, such as:
- Export License for export-oriented businesses.
- NCC License for telecommunications.
- CBN License for financial institutions.
- NUPRC Oil and Gas Permit for petroleum sector companies.
Navigating the foreign registration process in Nigeria can be complex, but it is manageable with the right guidance.
Kudi Konsult can assist you in structuring your business in Nigeria and can also offer immigration support For enquiries please call Dammy on +234 81 0399 3662 or chat by clicking the Whatsapp Icon below.
