HOW TO REGISTER A PRIVATE COMPANY LIMITED BY SHARES IN NIGERIA – Step by Step Guide
Once a company is registered it becomes a corporate entity with separate legal personality status different from that of the promoters, directors and subscribers.
It is a MUST to register a company in Nigeria otherwise the operators will be violating the provisions of the Company and Allied Matters Act, (CAMA) 2020 now in force.
The Corporate Affairs Commission popularly known as CAC was established by the Company and Allied Matters Act as the Body saddled with the responsibility of registering corporate entities in Nigeria; thus, the Commission is in charge of the registration, regulation and supervision of companies in Nigeria.
The 2020 CAMA which is now in force has introduced some notable changes to the requirements for registration of companies in Nigeria, few of the relevant ones are:
- One person may now successfully register a company as the only director and subscriber of the company; the repealed law required at least 2 directors and subscribers.
- A private company limited by shares must now have a minimum issued share capital of N100 thousand in order to be registered (Section 27(2) of the Act); the repealed law allowed a minimum share capital of N 10,000 for private companies limited by shares.
- All the proposed share capital of the company to be registered must be issued or taken up at the time of registration; the repealed law allows for bloated ‘Authorized Share Capital’ to be registered with the requirement that at least 25% of the registered authorized share capital must be issued or taken up at all relevant time.
- A Director of the company or a legal practitioner may now attest to the Statement of Compliance (Section 40 of the Act); the requirement under the repealed law was a statutory declaration of compliance to be done by a legal practitioner.
The process of registering a company in Nigeria is now fairly friendly and private persons, startups entrepreneurs or investors can now register their company in Nigeria in simple straightforward steps using the Corporate Affairs Commission’s company registration portal (CRP).
A company registered in Nigeria is affected by a couple of Nigerian Laws therefore it is important for private persons and companies seeking to register a company in Nigeria to always seek proper advice and guidance in this regard in order to avoid operational and regulatory issues.
If you are not in Nigeria, registering your company by yourself in a country where you are not a resident may be a pretty daunting process thus, we advise you seek the advice of corporate law lawyers in Nigeria and CAC Accredited Agents for proper consultation on how best to approach the registration of your company. This will save you from the challenges of having to research through the many Nigerian corporate laws by yourself and you will enjoy the benefits of having an expert guide you while jumping through the potential legal hoops you may be faced with while attempting to register your company by yourself in Nigeria.
A company may be registered as a private or public company.
Please note there are 3 types of private companies that may be registered and these are –
- Private Company Limited by Shares,
- Private Company Limited by Guarantee, and
- Private Unlimited Company.
This guide is however centred on a step-by-step procedure for the registration of a private company limited by shares in Nigeria.
Things to do before starting the registration process:
- Decide the nature of the company.
As mentioned above, there are 3 types of private company and you have to make up your mind on the type you desire to register. If your desire is to register a private company limited by shares then this guide is for you.
2. Decide the share capital of the company and what percentage of the share capital will be for each shareholder.
As mentioned above, the minimum share capital requirement for a private company limited by shares is now N100 thousand and this can be shared between subscribers in desired proportions.
3. Decide who will be the Director(s), Secretary and Shareholders of the company.
Get the particulars of the proposed Director(s), Subscriber(s) and Company Secretary ready. As said earlier, a company can now have just one director and that director can be the only subscriber as well as the secretary of the company.
4. Decide and prepare the following documents:
i. The objects of the company
ii. The regulations of the company
The objects of the company and the regulations guiding the company are usually contained in the Memorandum of Association and Articles of Association of the Company, commonly called ‘MEMART’ for short.
The objects of a company, in plain terms, mean the list of areas of operations and activities the company will be engaged in. It is very important that you have your objects properly prepared in compliance with the requirements of CAMA and that the objects comprehensively capture the scope of all your intended business operations. Only the actual objects of the company are to be prepared, the remaining details making up the MEMART will be autogenerated from the information filled on the Company Registration Portal.
With respect to preparing regulations for the company, the Commission has made available a default Article via its Company Registration Portal and the same can be adopted, however, what is right for one company may not always be right for another hence be sure to comprehensively review the default Articles or better still, prepare an Article that will be specifically relevant to the needs of your proposed company. You may want to get the help of a professional to save you the woes that may come with a badly prepared Article cum MEMART.
5. Get your documents ready
The following documents are required to complete the registration of your company in Nigeria:
a. Any government-approved ID card for the Director(s), Secretary and Shareholder(s). Approved ID card include Permanent Voter’s card, National ID, Drivers’ License or International Passport.
b. Passport photograph of the Director(s), Secretary and Shareholder(s)
c. Signature specimen of the Director(s), Secretary and Shareholder(s)
d. Statement of Compliance – Any of the directors may fill his/her details directly on the Company Registration Portal to attest to the fact that the application for the registration of the company is in compliance with the provisions of the Act, but your accredited agent, if you choose to use one, may need to upload the Statement of Compliance. You may want to seek the services of a legal practitioner who ordinarily has the legal background and training to attest to compliance of this nature.
e. Other documents that may be required by law as supporting documents for the registration of a company operating in the line of your chosen business.
Please note that some of the above-listed documents are to be in Pdf format while others are to be in Jpeg format.
6. Get a payment card (ATM Card) ready
You will need a payment card to process payment via the Commission website using REMITA so it is important to have one ready.
The entire process of registration can be done online without needing anyone provided you have access to your own internet supply.
The timeline to complete a company registration has now been significantly reduced and depending on the prevailing circumstances, the entire process can be completed in one day. However, to successfully register your company with the Corporate Affairs Commission online registration portal, you must comply strictly with the step-by-step procedure as highlighted on the Company Registration Portal (CRP) otherwise your application will be queried by the Commission and the Commission will query the application for as many times as is necessary until you fully comply with the requirements. Queries can be avoided by seeking professional advice from corporate lawyers and CAC Accredited Agents.
Step-By-Step Process on How to Register a Private Company Limited by Shares by Yourself
Step 1. Conduct a Name Search
Conduct a comprehensive search via the FREE search tools to weigh the probabilities of the availabilities of the names you desire for your company using this Public Search link.
NOTE: This search is important to confirm that your desired names are not already registered or similar to one already registered by a different entity, and this will save you from wasting time and money to apply for an already registered name or one similar to a registered name as that will lead to a denial of your application to have your desired name registered.
Once you are convinced that your desired names are not already registered or similar to an already registered name then proceed to step 2. You must also ensure your desired names does not fall under the category of restricted names or prohibited names.
Step 2: Login or Create an Account
Login to your user account on the Corporate Affairs Commission’s Portal using your “User Name” and “Password” via Login link or create an account if you do not have an account yet using the Register link.
NOTE: Ensure no word appears twice in the address you supply while creating your user account to avoid having your application queried much after you have commenced registration.
Step 3: Apply for a Name Reservation
Apply to have your proposed names reserved using the Name Reservation link.
NOTE: You will be required to supply 2 proposed names, however only one will be approved for reservation. The 2 proposed names must end with the word “LIMITED” or “LTD.” It is important to ensure your desired names does not fall under the categories of restricted or prohibited names. It is equally important to make the appropriate selections from the options available e.g., whether the reservation is for new incorporation, or that it is for a company limited by shares, etc. You should note that if your application for a name reservation is denied then you will have to repeat the process by submitting another 2 proposed names and pay another reservation fee to reserve a name.
If the name is available, the Corporate Affairs Commission will issue an approval note for a period of sixty days during which time the Commission will not approve the name for any other person or company proposing to use the name. However, failure to fill incorporation forms and pay the required registration fee within that period of 60 days from the date of reservation would mean that the reserved names will lapse and any person or company may apply for the name and have it reserved in their favour.
Step 4: Fill in Registration Details
Upon reservation proceed to your user dashboard to complete the registration process. To proceed with the registration, you can click on the “Start Registration” button if the button is available in front of the reserved name under the Approved Names’ tab, and just proceed accordingly to complete your registration. However, if there is no “Start Registration” button showing across the reserved name under the Approved Names tab then click on the Availability Note showing across the reserved name, copy the availability code, then proceed to your dashboard, locate the button for starting a new company registration and click on it, then paste the availability code you have just copied into the name bar at the top, the reserved name will pop up and you can click on ‘start registration’ and proceed with your registration accordingly.
NOTE: Ensure to select the right category for your company and do not repeat any word while typing in the needed addresses to avoid possible query on your applications. Be sure to also enter the appropriately prepared objects for your company as well as the current personal details of all persons to be registered as Director(s), Subscriber(s) and Secretary.
Step 5: Upload Necessary Documents
Upload all necessary documents as listed above.
NOTE: If your line of business is one that requires special documentation such as a license to operate in your line of business, permits or some form of approvals, it is advisable that you secure such documents from the appropriate Bodies or have them secured or drafted by a competent corporate lawyer as the case may be.
The services of a corporate lawyer may also be required for the drafting of the objects of the company or to draft an Article of Association different from the default Articles provided by the CAC.
Also, although Section E of the registration portal may now be filled by any of the directors, the Commission equally made it possible for the Section to be complied with by securing a legal practitioner to attest to it that all incorporation documents are in compliance with the law thus the service of a corporate lawyer may also be needed for this purpose.
Also note that the requirement to download your incorporation documents and sign, before login into a separate Documents-Upload portal to upload signed documents, ID cards and other accompanying documents have been abolished.
Step 6: Make Payment
After accurately filling in all necessary details and uploading all necessary documents you are to proceed to make payment for the necessary fee. The specific payment to be paid to for incorporation include:
i. Registration Fee to be paid to the Corporate Affairs Commission (CAC).
ii. Stamp Duty to be paid to the Federal Inland Revenue Service Fees (FIRS).
NOTE: All payments are made via the Company Registration Portal using REMITA.
Step 7: Download and Print your Business Registration Certificate
If your application is in order, the Commission will approve the application and you can proceed to download your Certificates and incorporation documents from your dashboard and print the same at your convenience.
NOTE: The requirement to physically visit the Corporate Affairs Commission office to submit printed copies of incorporation documents in exchange for incorporation certificate has been dispensed with.
It is important to mention that a registered company can be operated nationally; it is not state-bound therefore it does not have to register in each state where the proprietor(s) plan to carry on their business endeavours.
If you have questions or require further assistance with the process for business registration with the Corporate Affairs Commission in Nigeria, you may contact us here for proper consultation.
Written by: the Law Nation Corporate Law Team
Law Nation and all our corporate lawyers are CAC accredited agents for company registration in Lagos, Nigeria.
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The Corporate Law Lawyers at Law Nation are always ready to help business owners and investors register their company in Nigeria. If you are planning to start a business in Nigeria, do contact us, we may be able to help in more ways than one.
If you need assistance with any other CAC services please do not hesitate to contact us for a proper consultation with any of our experienced Corporate Lawyers and CAC Accredited Agents in Lagos, Nigeria.
The content of this article is intended to provide a general guide on the subject matter. Professional advice should be sought about your specific area of operations or circumstances.
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