Understand the Jurisdictions Setup Requirement Before Proceed Your Nigeria Company Formation
Nigeria is a country in West Africa, situated between Benin and Cameroon. As there are oil fields in Nigeria, it is one of the richest and most populous countries in Africa. Many foreign investors look for an opportunity for Nigeria Company Formation, especially related to the oil industry.
The government is also developing other infrastructures, like agriculture, roads, and power. There is a huge potential for growth for a company owner in Nigeria.
Nigeria’s GDP levels have been continuously on the rise, because of the rise in oil prices worldwide. Right now, Nigeria is considered one of the top location for forming a new company.
Features of Nigeria Company Formation
An investor forming a company in Nigeria can avail of many benefits. Let’s have a look at what features Nigeria Company Formation offers foreign investors:
- Tax exemption for up to three years
- Double taxation benefits with trade partners like France, Germany, The UK, and the Netherlands
- Import of raw materials is totally duty-free
- 100% foreign ownership is legal
- Minimum capital is very less
- A company can have as less as two directors. The maximum number of directors a private company can have is 50.
Types of Companies in Nigeria
Before you proceed with Nigeria Company Formation, you should decide which type of company you would like to form. Under Nigerian Law, there are different types of companies you can incorporate.
1. Sole Trader
This is the most basic and simplest type of company. It does not require registration, but you may register your business name so that other businesses do not use it. In this, the person is solely responsible for all aspects of the business and also incurs profits earned or losses suffered.
2. Private Limited Company (PLC)
A Private Limited Company is a separate legal entity. It is the most popular type of company. The shareholders of the company are liable only for the contribution they have invested in the company.
3. Public Limited Company
Unlike a Private Limited Company, a Public Limited Company can open its shares to the public. It can even sell shares in the stock exchange. A Public Company is usually required to have at least 500,000 as share capital. As the formation and operation costs of such companies are high, Public Company is usually preferred by large organizations.
4. Guarantee Company (Non-profit)
These companies are run by charitable organizations. They do not have a share capital and no member is an owner of the company. Any money they receive is used for operations or for fulfilling the objectives of the company.
5. Unlimited Company
This type of company presents an unlimited liability to its shareholders. Only a huge parent organization can opt for this type of company as a subsidiary with unlimited risk. If you are a first-time investor or a relative newbie, this type of company is not at all suitable for you.
Procedure for Nigeria Company Formation
Before you proceed with Nigeria Company Formation, you need to prepare with the following information:
- Company Name
- Type of company
- Share capital amount
- Details of the business you are proposing to operate
Once you have this ready, you have to go through the following steps:
- Visit the Corporate Affairs Commission Office and obtain Form CAC1. This is for checking the availability and reserving your company’s name.
- Fill the form and submit it at the CAC office.
- The name search takes a few days. If the name you have submitted is unavailable, you have to submit another name.
- If it is available, you have to submit Form CAC 2.2. This form is for your company’s registered address.
- Along with form CAC 2.2, you have to submit:
- Two copies of the Article of Association and Memorandum of Association
- Form CAC 2.3 and CAC 7 consisting of the list of Directors and their details and consent letters
- Form CAC 2.4 stating the amount of share capital and signed by at least one Director
- Form C.0.1, which is a compliance declaration drawn by a lawyer for you
- Details of the Company Secretary
- Identification documents for the Company Secretary, the Directors, and the shareholders
- You will have to pay a fee depending on the share capital of your company (from a minimum of 10,000 nairas for Private Companies to 500,000 nairas for Public Companies).
- After a few days, you will receive the Certificate of Incorporation.
- You can also opt for fast track incorporation at the CAC by paying 50,000 nairas.
If Nigeria Company Formation is on your mind, we are here to help. Hiring a legal firm facilitates your process and makes forming a business in Nigeria very easy.
We help you through the process in case you wish for a Nigeria Company Formation. For more information and guidance to Nigeria Company Formation, contact 3E Accounting, United Kingdom. We will help you with all aspects of registration.
You can also contact us to request a no-obligation quotation or get more information about registering a business in Nigeria.