Doing Business in Nigeria.
Foreign investors who would like to set up a branch of their business in Nigeria must go through the normal steps of incorporating a company in Nigeria.
100% foreign ownership is permitted expect in certain sectors of the economy, for instance production of arms, military apparel and narcotic drugs. It should also be noted that despite this provision, there are certain sectors in the economy that will not issue an operational license to a 100% foreign owned company, for example oil exploration and productions.
Procedure for company incorporation.
It is advisable to incorporate a company with a share capital of Ten Million Naira (N10,000,000) (approximately US$28,000). This is because one of the requirements for registration with the Nigerian Investment Promotion Commission (NIPC) is that a foreign owned company must have a share capital of at least Ten Million Naira.
However there are some companies that require a higher share capital threshold. Examples are companies in the International Air Transportation business which require a minimum share capital of Two Billion Naira (N2,000,000,000), Shipping companies require a minimum share capital of Twenty Five Million Naira (N25,000,000) and companies into the business of Freight Forwarding require a minimum share capital of Five Million Naira (N5,000,000).
Required documentation at the time of incorporation.
Copy of Certificate of incorporation of foreign company (Certified Translation required if it is not in English).
Board Resolution stating that the foreign company is desirous of setting up a branch in Nigeria. The resolution should also state who it is appointed to represent the company in Nigeria.
Means of identification of the representatives/directors/shareholders.
Registration with (Nigerian Investment Promotion Commission) NIPC.
Every company with foreign participation must be registered with the NIPC
Certain types of companies are required to obtain an operational license before they commence business. Examples of these sectors include Pharmaceuticals, telecommunications, insurance etc.
If the company intends to employ foreigners, the company is required to apply for expatriate quota positions.
Transfer of Technology.
Transfer of technology agreements are regulated by the National Office of Technology Acquisition and Promotion (NOTAP)
Foreign investors can bring in capital for investment and are free to repatriate both the income and capital proceeds.
Qualifying industries like Agriculture, Mining & Quarrying, Manufacturing, Electricity & Gas Supply, Waste Management, Construction and E-Commerce Services enjoy tax holidays.