A tech company intending to carry out technological operations in Nigeria is required to be registered with the Corporate Affairs Commission (CAC), which is the principal regulatory body that regulates the registration of all business structures in Nigeria. There are different business structures available to register a tech company in Nigeria and each business structure has its benefits attached. The type of business structure that is recommended for a tech company is a company limited by shares.
- Private Company Limited by Shares
A suitable business structure that a tech business can be registered under is a private company limited by shares. Registering as a company is the most appropriate vehicle to register a technological company because of the benefits attached. a company has a distinct separate legal personality from its owners as the company can be held liable for any action or omissions that arise from its operations, it enjoys perpetual succession and with the ability to sue and be sued in its own name.
To register a tech company with the CAC and commence business operations, there are prescribed procedures and documents to be complied with before it can be successfully registered.
The following are the requirements to register a tech company with the CAC
- Two (2) options for the proposed company name.
- The objectives of the company.
- The address of the company.
- The share capital and shareholding formula among shareholders of the company.
- The particulars of a minimum of two (2) Directors with valid means of identification such as identification card, national ID, drivers’ license, or international passport.
- Particulars of the shareholders of the company and their means of identification.
- The memorandum and Articles of association of the company.
- Evidence of payment of the prescribed application fees.
Upon incorporation of the tech company with the CAC, the company obtains a unique tax identification number (TIN) and also registers for Value Added Tax (VAT) with the Federal Inland Revenue Service (FIRS). The TIN is used for the payment of applicable taxes.
Registration with other Regulatory Agencies
It is important to state that registering the tech company with the CAC may not be the final step for setting up a tech company in Nigeria. There are other regulatory agencies that a tech company is to be registered with before commencing operations in the technology industry. Some of the relevant regulatory agencies are as follows:
- National Office for Technology Acquisition and Promotion (NOTAP)
NOTAP is a regulatory agency that regulates the transfer of foreign technology into Nigeria. It requires the registration of technology transfer agreements in sectors such as finance and insurance, manufacturing, franchising, technical services, management services, technical know-how, oil and gas, civil construction and power and energy, etc.
Requirements for the registration of a tech company with NOTAP are as follows;
- A copy of the duly completed application form.
- Certificate of Incorporation with the Corporate Affairs Commission.
- Memorandum and Article of Association of the company.
- A duly completed TAA Pre-Qualification Form.
- Tax Payer Identification Number (TIN).
- A draft copy of the Technology Transfer Agreement to be registered.
- A copy of the duly completed NOTAP questionnaires for different sectors.
- A duly completed copy of the Monitoring Form.
- A copy of the feasibility study report of the company.
- Annual audited accounts for the preceding three years.
- Evidence of tax payment for the preceding three years.
- Profile of the technical partner.
- Performance bond for advanced payment.
- A comprehensive training program, which must include staff, skills or knowledge to be acquired.
- Approval or licenses obtained from the relevant authorities and bodies such as the Nigerian Communication Commission (NCC) for agreements on communication etc.
- National Information Technology Development Agency ((NITDA)
The NITDA plays a vital role in the technology industry as it is charged with the responsibility of planning, researching, regulating, monitoring, evaluating, and verifying the progress made in the information technology practice, activities, and systems in the Nigerian economy. Every tech company (information technology service providers/consultants) and contracts to Ministries, Departments, and Agencies of the Federal Government are required to be registered with the NITDA.
- Registration with Nigeria Telecommunication License (NCC)
Depending on specific services a tech company intends to engage, a registered tech company may also be required to obtain from the NCC. A tech company willing to carry out any services relating to telecommunication or value-added services (VAS) is mandated to obtain a license from the NCC.
The technology industry is one of the fastest-growing industries in Nigeria. A tech company must first be registered with the Corporate Affairs Commission (CAC) as the certificate obtained will be required to register with any other relevant technology sector regulatory agencies if required.
By Corporate & Commercial Law Team at Resolution Law Firm