How to Register a Company with Foreign Participation with the Corporate Affairs Commission in Nigeria

Foreign Participation in Nigeria: An Increasing Commercial phenomenon

Foreigners and foreign corporations find Nigeria to be a good investment location for investment, particularly given Nigeria’s youthful population and natural resources. Thus, for many foreign investors, establishing a business in Nigeria as a foreign investor is a strategic move, given the country’s position as one of Africa’s largest economies. It therefore makes sense for these foreign corporations to incorporate and set up local offices in Nigeria in order to tap into Nigeria’s investment potential; establish local partnerships in Nigeria’s industries, and operate in Nigeria’s business sectors for maximum profit.

Nigeria offers a vast market for international investors, but the process of entering this market involves navigating specific statutory requirements designed to ensure economic stability and local compliance. For any foreign entity or individual looking to establish a presence, the journey begins with formal incorporation. Under the Companies and Allied Matters Act (CAMA), the Nigerian government has streamlined the registration process, though it maintains strict thresholds for foreign-owned enterprises—most notably regarding minimum share capital and professional representation. Understanding these foundational steps is essential for a seamless transition into the Nigerian business ecosystem.

Kabbiz Global has handled numerous incorporations for companies with foreign participation and so we are well-positioned to guide on establishing foreign companies in Nigeria.

In this article, we provide extensive information on incorporation of foreign companies in Nigeria.

What Agency handles incorporation of Companies in Nigeria?

The regulator that is charged with handling and overseeing business incorporation and regulatory oversight in Nigeria is the Corporate Affairs Commission [“CAC”]. The CAC registers companies alongside other types of entities, and is also responsible for handling statutory returns, changes in corporate structure, winding up of these entities, among others. All incorporation and post-incorporation activities are governed by the Companies and Allied Matters Act which extensively governs registered entities in Nigeria, including companies with foreign participation.

What do Foreign Companies need to do before doing business in Nigeria?

Foreign companies cannot do business in Nigeria without first incorporating local subsidiaries with the CAC in Nigeria. If they are establishing a business presence in Nigeria, they must first register a Nigerian entity. Foreigners and foreign companies cannot register Business Names, neither can they register or form members of partnerships under Nigeria’s extant legal framework, so they must register a Nigerian company and meet up with all compliance requirements before they can carry on business in Nigeria…that is, unless they fall within the category of foreign entities that are exempt from registration with the CAC.

Essential Requirements for Foreign Entities seeking to register in Nigeria

To successfully register a company with foreign participation with the CAC, you must provide the following:

• Company Name: A company can only be registered upon the reservation of a company name at the incorporation portal, which must end with the word “Ltd” or “Limited” where the company is a private company limited by shares. In the past, the CAC allows potential registrants to choose a primary name and an alternative name for availability screening, but following overhauls to the portal, compliance screening is immediate and a name can be reserved immediately upon commencement of the process.

• Business Objects: The promoters of the proposed company are required to draft the business objectives of the company in numbered paragraphs. You must ensure these do not fall under the NIPC Negative List, which excludes areas like arms production or narcotics. A company’s business objectives can be as short as they want, or as long as their intended business objectives in Nigeria are.

• Entity Structure: You must designate your proposed registered entity as either a Private Limited Company (Ltd) or a Public Limited Company (Plc) with the suffix at the end of the company name to show which the proposed company is/will be upon registration.

• Minimum Issued Share Capital: For companies with foreign participation, the minimum issued share capital requirement is ₦100,000,000. It was previously ₦10,000,000 but under the new corporate regime, the minimum is ₦100,000,000, fully allotted to all shareholders of the company. This minimum share capital determines the fee the proposed company will pay to the CAC as incorporation fee and the fees it’ll pay to the Nigeria Revenue Service as stamp duties (which is pegged at 0.75% of the share capital)

• Physical Presence: Every company registering in Nigeria must have a physically verifiable registered office address within Nigeria. The promoters of many entities with foreign participation do labour under a mistaken misapprehension that if they are not physically going to carry on business in Nigeria, they do not require a physical address, but this position is wrong, as they must provide a physical address in Nigeria for incorporation.

• Stakeholder Data: You are required to provide extensive and comprehensive details for all directors and shareholders, including their respective equity portions, IDs, names, service and residential addresses, contact emails and phone numbers; signatures.

• Company documentation: If the proposed company with foreign participation intends to have a foreign company or companies as shareholders, the foreign company shall provide its incorporation documentation that details its corporate structure; alongside board resolution signed by its principal officers approving subscription to the shares of the proposed Nigerian entity. Without these foundational documents and Board Resolution, the CAC will query the registration of the Nigerian entity and will not approve same for registration until the said documents are provided.
• Company Secretary: From experience, every company with foreign participation must appoint a company secretary, be it individual or corporate entity specialized in providing company secretarial services. You can appoint licensed lawyers, accountants, chartered secretaries or corporate entities like Kabbiz Global Nominees which provides company secretarial services to act as your company secretary for the Nigerian entity.
• Proficiency Certificates, If the company wishes to perform specific activities that requires professional qualifications, copies of relevant proficiency certificates in those disciplines are a mandatory prerequisite to registration.

Step-by-Step Guide to Register a Company with Foreign Participation in Nigeria

The path to incorporation involves a series of logical steps, from conceptualizing the brand name to the final submission of legal documents. Below is the procedural breakdown for establishing your Nigerian subsidiary:

Name Selection and Reservation

The first formal action is selecting a name for your Nigerian operations. It is important to note that the Nigerian entity does not have to bear the exact name of the parent company, though many choose a variation (e.g., “Google Global Services Nigeria Limited”). If your chosen name is available, registrable and passes the compliance check, the CAC will reserve the name for 60 days to allow you to complete the registration within the stipulated period.

Compilation of Essential Particulars

Before filing, you must gather comprehensive data for the individuals and entities involved in the company’s governance:

• For Directors and Secretaries: You must provide their full name, residential address, service address, gender, telephone number, and email. Required attachments include specimen signature, and a valid government-issued ID (such as an International Passport, NIN, or Driver’s License).

• For Shareholders (Subscribers): Detailed information on the individuals or corporate entities that will hold shares in the new company, including their percentage of ownership. The majority shareholders will form the Persons with Significant Control in the company as well.

Setting the Share Capital and Paying Statutory Fees

Under current regulations, companies with foreign participation must have a minimum issued share capital of ₦100,000,000, and, as aforementioned, this affects the fees that are payable for the incorporation both to the CAC and NRS for stamp duties.

Once the name is reserved and the particulars are gathered, your CAC-accredited agent will prepare the final filing suite by compiling all information, documentation, and specimen signatures. The agent will also draft the Memorandum and Articles of Association (MEMART) and other necessary forms based on a specific checklist tailored to your business objectives. Thereafter all the information and documentation is forwarded to the CAC in prescribed form, then payments made, before the entire suite is submitted for final review and approval.

After the CAC verifies that all requirements meet all regulatory standards, the application is approved. This marks the transition of your foreign business into a recognized legal entity capable of entering contracts, hiring employees, and conducting trade within Nigeria.

Post-Registration Documents

Upon successful vetting and approval, the CAC will issue the following official documents:

1. Certificate of Incorporation of the company.

2. Status Report (detailing current directors and shareholders).

3. Memorandum and Articles of Association (MEMART) of the company.

Tax Registration with the Nigerian Revenue Service (NRS)

Upon incorporation, the new Nigerian company will receive a Tax Identification Number (TIN). This is usually inscribed at the bottom left-side corner of the certificate of incorporation, or, sometimes, it doesn’t appear at all. However, the principal officers of the company are also required to visit the assigned Tax Office closest to the registered address of the Business, verify the company’s Tax ID, then get the company registered/onboarded on TaxPro Max for VAT and company income tax compliance filings.

Post-Incorporation: Mandatory NIPC Registration for Foreign-owned Nigerian Companies

Once your foreign-owned Nigerian company is legally incorporated with the CAC, the next critical statutory milestone is registering with the Nigerian Investment Promotion Commission (NIPC). While the CAC gives your company a legal identity, the NIPC provides you with the “license to operate” as a foreign investor in the Nigerian economy.

Under the NIPC Act, this registration is a mandatory compliance requirement for all registered companies with foreign participation.

The Strategic Role of the NIPC

The NIPC serves as the primary federal agency tasked with coordinating, monitoring, and promoting investments in Nigeria. By registering your business, you transition from being a “local company” to a “recognized foreign investment,” allowing the government to track capital inflow and provide necessary sovereign protections.

Key Benefits of NIPC Registration

Registering with the NIPC offers significant strategic advantages that safeguard and scale your business:

• Investment Protection: You gain the full protection of the NIPC Act against nationalization or expropriation by the government.

• Unrestricted Profit Repatriation: It facilitates the unconditional transfer of profits, dividends, and net proceeds (less local taxes) out of Nigeria in any convertible currency.

• Eligibility for Incentives: Registration is a prerequisite for applying for major fiscal incentives, such as Pioneer Status Incentive (PSI), which offers a 3 to 5-year corporate tax holiday.

The NIPC Application Process and Requirements

To ensure a successful registration with the NIPC, companies must provide:

• Proof of Incorporation: You are required to provide the CAC Certificate, Status Report, and Memorandum and Articles of Association of the company.

• Investment Profile: Comprehensive details regarding the nature of the business and your specific investment plans in Nigeria.

• Financial Projections: Data illustrating the expected economic impact and financial trajectory of the company over its initial years.

• Sector-Specific Licenses: If your business operates in a regulated industry (such as Fintech or Oil & Gas), you may need to provide your operating permit from the relevant regulator in that sector to ensure you are duly licensed to operate.

Industry/Sector-Specific Licenses

There are sectors in Nigeria that require specialized regulatory licenses before a company can operate in that sector. Thus, these foreign-owned companies may require licenses in some sectors, which include:

• Financial Services
• Fintech
• Telecoms
• Oil & Gas
• Real Estate

Professional Legal and Regulatory Support

Navigating the regulatory complexities of the Nigerian market requires more than just paperwork; it demands a strategic partner who understands the local landscape. Whether you are navigating the ₦100,000,000 share capital requirement, securing NIPC certifications, or seeking guidance on opening corporate bank accounts, our team of accredited experts is here to streamline your market entry. We handle the entire end-to-end process—from initial name reservation to post-incorporation compliance—so you can focus on scaling your business. To begin your Nigerian expansion, please contact us via email at [email protected] for a professional consultation.