LEGAL ASPECTS OF DOING BUSINESS IN NIGERIA by sdfwerte

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									LEGAL ASPECTS OF DOING
  BUSINESS IN NIGERIA
      Nigeria's legal system is based:-

•English common law
• Islamic Shariah law (only in some northern
states)
•Traditional law.
• The Companies and Allied Matters Decree of
  1990 regulates companies in Nigeria (regulated
  by THE CORPORATE AFFAIRS COMMISSION ) -
  advice, regulate, investigate and supervise all
  aspects from incorporation to winding up.

• The country's judicial system consists of the
  Supreme Court and the Federal Court of Appeal
  Capacity:          Incorporated        Foreign
                       Trustees         Company


Private of Public        Sole
                                      Representative
Limited liability    Proprietorship       Office
    company


   Unlimited
                    Company limited    Partnership
    Liability
   company           by guarantee
  All business enterprises MUST be registered with the
  Registrar of the Corporate Affairs Commission (Registrar of
  Companies).

  Minimum Authorised Share Capital

• Private Company:- N10,000

• Public Company:- N500,000

  Not less then 25% of the Authorised Share Capital must be
  allotted.
• Membership of the Company- prohibition of
  Trusts

• Disclosures to be published

• The law requires companies/enterprises to
  ensure that Certificate of Registration
  displayed in conspicuous positions
Operations of Foreign Companies in Nigeria:



       (a) Foreign              (b)
       companies          Representatives
          (54.1)              Offices
 (a) Foreign Companies

                   Power of               Business
 Obtain local      Attorney
incorporation                              Permit
                   Must be disclosed in
                Incorporation documents   Apply to the NIPC
Exemptions:

a) Invited with approval of Federal Government
b) Execution of specific loan project
c) Foreign government owned companies-
   export promotion only
d) Engineering consultants/ technical experts
   under govt contract.
Application for exemption:

  Made to SGF.

  The National Council of Ministers may at
  anytime revoke any exemption granted to any
  foreign company, if is of the opinion that
  company failed to fulfil any condition
  contained in its exemption order.
(b) Representatives Offices

 Cannot     Promotional
                           Registered
engage in   and Liasion
                            with CAC
business     office only
Foreign Investment Requirements

Nigerian Enterprises promotion (repeal) 1995
  has abolished any restrictions on foreign
  shareholding.

Exemptions: production of arms and narcotic
  drugs.
NIPC Decree no.16 1995-
Established the NIPC as successor to IDCC
         Functions: to
    encourage, co-ordinate
                               Priority areas of
       and oversee the
                                 investment
       establishment of
          enterprise



    Guarantees Investment    Incentives for special
         Protection               investment
Provisions relating to Investments

  A Foreign investor is an approved enterprise is
  guaranteed unconditional transferability of
  funds through an authorised dealer.
Establishing new companies
                  Get good Lawyer to
                    advise on pre-
                incorporation strategy




                Obtain tax clearance
                and acquire premises




                 Business permit and
                  expertriate quota
      Business permit
                                   Expatriate Quota
Permanent authorisation for
                               Official permit to employ
 local operation of business
                                individual expatriates
  with foreign investments
                               (usually granted 2-3 years)
Appointment of foreign directors

     Directors of business’s choice- resident
     or non-resident



      Payment of Directors fees same as
      dividends accruing to foreign company



     Taxed at source 5%
Pioneer Status:
                   List of pioneer
                  industries in The
              Industrial Development
               (income tax relief) Act
                         1990


               Income derived from
              pioneer products- relief
               from income tax for 5
                 years (Tax Holiday)
Labour, Health, Trade & Environmental standards:

       Factories Act:         Workmen’s
     special certificate   Compensation Act:
         required          For injuries at work


                National Minimum
                      Wage:
                  N5000 / month
Regulatory Bodies:

								
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