How to Incorporate a Foreign Company in Nigeria… (Basic Preliminaries)

Do you own a foreign company and you desire to launch the company in Nigeria? Have you been researching on how to go about it? This article is written just for you.

Foreign participation is a welcome development in Nigeria. As a foreign company seeking to come to Nigeria, you can have a 100% ownership of your business in Nigeria without government interference.

There are similarities in the process of registering a foreign company and a purely local company (for instance, you need two or more shareholders to register your company in Nigeria). The key difference is that there are additional requirements to register and operate a foreign company.

Back to the question “what is a foreign Company”? For the purposes of this article, a foreign company is a company validly existing under a foreign law, but with the intention of carrying on business in Nigeria takes necessary steps to register as a legal entity in Nigeria.

You may say “okay, now this definition is really long, so what does it mean?” Put in a simple way, it means that if your company wants to come to Nigeria to do business- full time, then, you must register the company as a separate entity in Nigeria.

As a foreign company seeking to operate in Nigeria, you cannot have a place of business in Nigeria neither can you do business if your company is not registered. The only thing you can do is perhaps to have a place where you can receive notices and documents that are necessary to bring your company into existence in Nigeria.

You may ask at this point “what if I want to have Nigerians in my company?” this is a welcome idea because it will reduce the cumbersome requirements needed of a wholely foreign owned company.

To operate your foreign company in Nigeria, here are some of the things that you must apply for: 

1. Certificate of capital importation (CCI)
2. Expatriate quota
3. Work permit
4. Residence permit
5. Combined Expatriate Residence Permit and Aliens Card (CERPAC)
6. Subject to Regularisation Visa etc.

You can engage the services of a Business Advisory Law Office to help you to register your company and also process necessary documents from the appropriate body, after which you will be able to do business in Nigeria.

Some foreign companies are allowed to operate in Nigeria without the need for registration! I hope this does not come as a surprise to you, but, yes you can actually be granted exemption from registering in Nigeria before you do business.

There are four categories of foreign companies that can be granted exemption in Nigeria, they are:

1. Foreign companies invited into Nigeria to execute specified individual project
2.  Foreign companies invited to execute specific individual loan project on behalf of a donor Country or international organisation.
3. Foreign owned government company engaged solely in export promotion activities
4. Engineering consultants and technical experts engaged in any individual specialist project under contract with government in Nigeria.

If you fall under any of the above categories, you may engage a lawyer to write an application letter on your behalf to the President of the Federal Republic of Nigeria through the Secretary to the President. Such letter ought to contain the following details:

1. Your company’s name;
2.  Members of your company;
3.  Names and addresses of your Directors;
4. Stamped photocopy of your company’s memorandum and article of association; and
5. The details of what your company intends to do in Nigeria.

Once your application is granted, your company will be exempted from the need to register, but it will continue to have the status of an unregistered company.

Where a foreign company is exempted under any bilateral treaty with Nigeria, it will continue to remain exempted from registering locally in Nigeria.

That your company is granted exemption does not mean that it is granted a licence to operate for life in Nigeria; exception is usually for a specified period, and after it expires, you will not be able to enjoy the benefits of an exempted company again.

Other than expiration, the president has power to revoke exemption clause particularly if it conflicts with any provision of a local law.

If exemption is however granted, it must be published in a Federal Gazette by the president.

Your exempted company is expected to keep some records with the Nigerian Corporate Affairs particularly its Annual Returns. You can reach me for further details on how to file annual returns of a foreign company in Nigeria.

Once you fail to register before carrying on business in Nigeria, everything you do may not receive the support of the local laws. That is not to suggest that you will not be able to sue to recover money, but there will be limitations to what you can do or not do.

There are trades which all companies (foreign and local) are not allowed to trade in. These include:

1. Production of arms and ammunition
2. Production and dealing in narcotics drugs and psychotropic substances
3. Production of military and paramilitary wears including those of police, custom, immigration and prison service wears
4. Such other items as the Federal Executive Council may from time to time determine in the negative list.

I hinted earlier that your foreign company may choose to have 100% full ownership of your business in Nigeria, otherwise, you may choose to involve a Nigerian in the ownership. From my experience in advising stakeholders of foreign companies with interest in bringing their business to Nigeria it is easy for me to strongly warn against 100% foreign ownership for obvious reasons, one of which is that if your company is unable to obtain expatriate quota, residence and working permit for its expatriates, they will be at risk of paying fines and getting deported.


ABOUT THE AUTHOR

Joy Abina is an Associate at Attorneys’ Haven L.P. She got her LL.B Degree from Rivers State University of Science and Technology and B.L. from the Nigerian Law School. Joy is passionate about core litigation practices and she combines that seamlessly with Business Advisory. You can reach her on 08144069217 or attorneyshaven@gmail.com

Interesting Reasons Why You Should Prepare Your Will

Do you want to be there for your family and loved ones after you are gone? If yes, then you need to prepare a WILL before demise. I know you are still young and vibrant and you are not expecting to leave anytime soon. Of course nobody wants to die, but sometimes, the unexpected do happen, this is the more reason you can’t afford to shy away from this very topic. What I have done is to help you approach this topic from the very real angle and the knowledge shared is based on real life situations and the provisions of Nigerian laws on the subject.

What do we mean by ‘WILL’?

A Will is a document by which a person gives his property to a beneficiary of his/her choice to take effect after demise. A Will is capable of being edited or even discarded at any time before the demise of the maker.

The maker of a Will is regarded in legal parlance as the “testator (male) /testatrix (female)”. A person may by a Will provide for the distribution of his/her wish or even property upon demise, either to one's children, husband or wife, relatives or donation towards charitable purposes as the case may be.

When a person makes a Will, the person is said to have died testate, but where none is made, such person is said to have died intestate in which event, the person's family will have to apply to the government for a letter of administration to be able to take possession of the benefits of the demised person. 

In Nigeria majority of adults see having a Will as something for old people anticipating death. Asking a young adult in Nigeria to have a Will is considered to mean a prayer for the death of the person. You may therefore hear an answer like “God forbid bad thing”; some may even tag you an enemy of progress.

Notwithstanding the popular stigma against making a Will, It is pertinent and cheaper to have a WILL. By so doing, you will cater for future contingencies, and keep your love ones in harmonious relationship while you are away, rather than putting them in disarray and disagreements over the inheritance you left behind. You can even instruct your loved ones about the befitting things you want them to do for you. What more? You will save your loved ones from the stress of asking the government for a letter empowering them to manage your entitlements (the grant of this letter sometimes takes more than a year to process).

Having laid a foundation for what I intend to establish, below are lucid points on why you should engage your lawyer to prepare your Will without any further delay:

a.    It makes your desires clear and leaves nobody in doubt of those desires. This way, you do not leave anybody guessing about what you would have wanted, and through that, you keep your loved ones in unity.

b.    You may desire to appoint those that you wish should be in charge of carrying out your instructions after demise; they are referred to as the EXECUTORS of your Will.

c.    It is cheaper to prepare your Will than leave your loved ones to be at the mercies of the government. If you really want to value this point, ask someone who has had to process the collection of Letter of Administration from the Government. For instance, I have interviewed clients before who could not access the account balance of a demised loved one because the money in the account is almost equivalent of the amount they will use to process a letter of administration from the government.

d.    A Will can be used to provide instructions for the mode of burial that the maker wants.

e.    If you have a heart for helping people from your wealth, particularly after your demise, your best bet is to put those specific instructions down in a Will. You can even specify the particular group or person that you desire to help in your Will.

f.       The persons that you wish are in charge of your instructions can begin to carry out those instructions faster when you make a Will.

Having considered the advantages of writing a WILL, it would be important to also consider the factors that will make your Will to be valid- because it will be unfair to wish to have a Will only for the Will to become nullified at the end of the day.

One of the key factors to be considered is that the person intending to make a Will must be of sound mind. This means that as at the time of making the WILL the writer of the Will has the ability to know what he or she is doing, know the extent of his or her properties, manner in which his/her properties are to be distributed, recollect the object of his/her bounties etc.

However, some diseases such as Alzheimer’s may prevent a person from remembering immediate family members and friends. The moment there is a doubt that the maker of the Will was not of sound mind as at the time of making the Will, then the Will becomes invalid.

Another requirement for the validity of a WILL is that the maker must be 18 years and above, hence it is only at that age and above that a person can validly write a Will. Although there are instances where someone that is below 18 years can do a Will, but we might not consider them because they fall outside the purport of this write up.

Once all the requirements are met, you can have your WILL prepared under the thorough supervision of your lawyer.

Please note that you can amend your Will as many times as you desire to.

Finally, a WILL is necessary for all, to ensure that we are able to decide all our wishes for ourselves and our loves ones even after we are no more. I would encourage us, that no one is too young or too old to have a Will.

For questions or contributions, you can reach me on 08064407638 or via email at oluwafemiakinluyi@gmail.com