Incorporating a Business in Nigeria

INCORPORATING A BUSINESS ENTERPRISE:

Legal Framework for Business Activities
Methods of Conducting Business
All business enterprises must be registered with the Registrar-General of the Corporate Affairs Commission (Registrar of Companies). A foreign investor wishing to set up business operation in Nigeria should take all steps necessary to obtain local incorporation of the Nigerian branch or subsidiary. Business activities may be undertaken in Nigeria as a :

(i) Private or Public limited liability company;
(ii) Unlimited liability company;
(iii) Company limited by guarantee;
(iv) Foreign Company (branch or subsidiary of foreign company)
(v) Partnership/Firm;
(vi) Sole Proprietorship;
(vii) Incorporated trustees;
(viii) Representative office;

INCORPORATING A BUSINESS ENTERPRISE:
The Companies & Allied Matters Act

Legal Framework for Business Activities
The Companies and Allied Matters Act and Incorporation Procedures
The Companies and Allied Matters Act, 1990 (the Companies Act) is the principal law regulating the incorporation of businesses. The administration of the Companies Act is under-taken by the CORPORATE AFFAIRS COMMISSION (CAC) and its functions include: 
(i) the regulation and supervision of the formation, incorporation, registration, management and winding up of companies.
(ii) the maintenance of a Companies Registry;
(iii) the conduct of investigation into the affairs of any company in the interest of share-holders and the public.

Minimum Share Capital and Disclosures in Memorandum of Association
The minimum authorised share capital is N10, 000 in the case of private companies or N500, 000 in the case of public companies. The Memorandum of Association must state inter-alia that the subscribers �€œshall take amongst them a total number of shares of a value not less than 25 per cent of the authorized capital and that each subscriber shall write opposite his name the number of shares he takes.�€ The law permits and acknowledges the roles of attorneys and other relevant professionals in facilitating business transactions provided, of course, that this �€œagency arrangement is disclosed".

Membership of the Company - Prohibition of Trusts
The Companies Act prohibits �€œnotice of any trust, express, implied or constructive�€ and such shall not be entered on the register of members or be receivable by the CAC.

Shares
All categories of company shares to carry one vote. Shares with �€œweighted�€ voting right are prohibited. All shares (i.e. whether ordinary or preferential) issued by a company must carry one vote in respect of each share.
Consequently, preference shareholders are entitled to receive notices and attend all general meetings of the company and may speak and vote on any resolution before the meeting.

Disclosures To Be Published In Company Correspondence and Business Premises
Every company is obliged to disclose on its letterhead papers used in correspondence, the following particulars:

(i) Name of the company/enterprise;
(ii) Address;
(iii) Registration/Incorporation Number;
(iv) Names of Directors and Alternate Directors (if any)

In addition, the law requires companies/enterprises to ensure that the Certificate of Registration be displayed in conspicuous positions at their principal and branch offices.