Compliances For Business in Nigeria

Compliances are those legal frame work a business must put in place before its operations. There are many compliances like Legal compliances, Regulatory compliances, Ethical Standards, Corporate Governance, Risk management, Corporate social responsibility etc.

For the purpose of this write-up, we will only consider the Legal and Regulatory compliances. These are basically the certificate and licenses a business is expected to acquire before operation in Nigeria. Business compliances, permit and license are legal document that allows individual business owners to legally create and operate a business in Nigeria. It is provided by relevant government bodies.

Other government agencies oversee business entities in Nigeria; some are general in nature, while others specialize on the type, industry, and structure of the planned company entity. The Corporate Affairs Commission (CAC) is the primary regulatory body in Nigeria that oversees business incorporation and registration. We have other bodies like Nigeria Social Insurance Trust Fund (NSITF), Federal Inland Revenue Service (FIRS) or Inland Revenue Service of different States of Nigeria depending on the type of entity you have. There is also Nigeria Export Promotion Council (NEPC) We have also Nigeria Upstream Petroleum Regulatory Commission (NUPRC) this body issues DRP permits (Department of petroleum Resources). The Nigerian Content Development and Monitoring Board (NCDMB). These boards regulate companies in Oil and Gas sector.

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Some of the licenses and permits required for operation in Nigeria are:

The Certificate of Incorporation: The Corporate Affairs Commission issues this certificate to anyone who intends to start any business in Nigeria. These businesses must be registered with the CAC, after due compliance with the registration requirement issues this certificate to the registered business corporation. The issuance of this certificate gives life to the company and qualifies it to operate legally in Nigeria, making it a separate legal entity.
Tax Identification Number: The Federal Inland Revenue Service (FIRS) in Nigeria gives this registration to all intending business owners as a means of identification for their business to pay tax in Nigeria. The registration is also done with the state inland revenue if the company intends to have employees for the payment of their income tax.
NSITF Certificate: The Nigeria Social Insurance Trust Fund issues this certificate. This is a mandatory contribution every employer is expected to make for his or her employees. It is paid annually. The certificate is one of the requirements with which to get the Tax Clearance Certificate.
Tax Clearance Certificate (TCC): this certificate is issued to companies that wants to apply for DPR permit. It is gotten from FIRS office.
Import and export license. These are necessary permits and licenses to be received upon due compliance with the registration process with Nigerian Customs Services or the Nigerian Export Promotion Commission (NEPC). This license facilitates international trade and ensures compliance with the customs regulations of the incorporated company.
Business Permit: This is a compulsory license for any foreigner who intends to start a company in Nigeria. It is an operational license given to a company to enable foreigners to start and operate a company in Nigeria. The Nigerian Immigration Service grants this permit.
Residence Permit: This is issued to foreigners who intends to reside in Nigeria and carryon business in Nigeria.
Expatiate Quota: It is an official document permit granted to foreign companies in Nigeria to be able to employ individuals from outside the country. This permit includes the position of the expatriate and the duration of their stay in the company which is subject to renewal depending on the choice of the company.
DPR Permit: this permit is issued by the NUPRC for the purpose of operation in the oil and gas sector of the country.
NOGIC JQS AND NCEC: These permits or certificates are issued by Nigerian Content Development and Monitoring Board (NCDMB). The NOGIC JQS is simply Nigerian Oil and Gas Industry Content Joint Qualification System. While NCEC is Nigerian Content Equipment Certificate, this is for Oil and Gas company that have equipment.

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These are some of the licenses and permits companies are expected to have depending on the sector the company is specialized on. The basic one among them is registration with CAC. As a business owner you are to ensure that all the aforementioned compliances are in place.

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In conclusion, the first step to obtaining a business license in Nigeria is to consider the type of business to be created, the industry it belongs to, and the structure. This enables you to understand the specific licenses and permits required to run this type of company in Nigeria. The next step is to register the business with the relevant regulatory bodies. The first regulatory body to be approached for the registration of all kinds of businesses in Nigeria is the Corporate Affairs Commission. After registration with Corporate Affairs, a tax identification number is given to the applicant by the Federal Inland Revenue to determine the payment of their taxes. Thereafter, the business entity must obtain its relevant industry-specific licenses from the relevant regulatory bodies.

In getting through these process it is advisable to hire a legal practitioners who are experts in this aspect to mitigate the challenges in getting the required licenses and permits.