There are a set of rules guiding foreign participation in Nigerian business. The Nigerian business environment is open to all foreigners. For a foreigner to start a business in Nigeria, the first step is to register a company with the Corporate Affairs Commission (CAC), which is the sole government agency responsible for incorporation throughout Nigeria.

We shall briefly explain the main requirements and steps by which a foreigner can invest or start a business in Nigeria.

The following are key steps a foreigner wishing to establish a business in Nigeria must follow.

  1. Incorporation/Registration of a business
  2. Registration with the Nigerian Investment Promotion Commission(NIPC)
  3. Approval for Business Permits
  4. Immigration Requirements and Residence Permit(CERPAC)/ Application for Expatriate Quota
  5. Bank Account Opening
  6. Procurement of Certificate of Capital Importation
  7. Taxation Registration

Let us briefly discuss the above.


It is instructive to note that only registered businesses in Nigeria are recognized by law to lawfully carry on business in Nigeria save for a few exemptions. A foreigner who seeks to commence business in Nigeria must register the same; the agency in charge of business registration is the Corporate Affairs Commission. The Companies and Allied Matters Act, 2020 (“CAMA”) puts this in proper perspective as it provides in Section 78 as follows:

  • Subject to sections 80 – 83 of this Act, every foreign company which before or after the commencement of this Act was incorporated outside Nigeria, and having the intention of carrying on business in Nigeria, shall take all steps necessary to obtain incorporation as a separate entity in Nigeria for that purpose, but until so incorporated, the foreign company shall not carry on business in Nigeria or exercise any of the powers of a registered company and shall not have a place of business or an address for service of documents or processes in Nigeria for any purpose other than the receipt of notices and other documents, as matters preliminary to incorporation under this Act. 

The Act also stipulates the types of business in which a person including a foreigner can be involved and they include a Limited Liability Company, an Unlimited Liability Company, and a Company Limited by Guarantee, either one can be private or public. However, a Private Limited Liability Company (LLC) is the most suitable and recommended type of incorporation for a foreigner.

A foreign-owned company must have a minimum of N10 Million authorized share capital. A foreigner from any country is allowed to register a company in Nigeria, and the process of registration of a company does not mandate a foreigner to visit Nigeria before he/she can register a company. A foreigner can choose to register a company in Nigeria from abroad.

However, it is important to note that various laws and regulations mandate that in certain industries such as oil & gas, finance, mining, and gaming the Nigerian citizens should be on board the company before it can partake in any business.



NIPC is an agency of the Federal Government saddled with the responsibility of coordinating and monitoring all foreign investment activities in Nigeria. The Federal Government of Nigeria has tasked the investment promotion agency with attracting Foreign Direct Investment (FDI) over the years.

The Commission initiates and supports measures that shall enhance the investment climate in Nigeria for both Nigerian and non-Nigerian investors.

Registration with the NIPC is compulsory for all foreigners intending to carry out business in Nigeria. Upon receipt of registration forms, the NIPC within fourteen working days will register the business after being satisfied with the relevant documents. The registration with NIPC guarantees foreign investments in Nigeria from expropriation.


A business permit is a document issued by the Federal Ministry of Interior through the Department of Citizenship and Business. This document allows for the operation of businesses in Nigeria by foreigners. The importance of this permit is that it ensures that foreign companies are not edging out Nigerian organizations with businesses that domestic companies already engage in.

Pursuant to Section 36 of the Immigration Act, it provides that no person other than a Nigerian citizen shall, on his own account or in partnership with any other person, practice a profession or establish or take over any trade or business whatsoever or register or take over any company with limited liability for any purpose without the written consent of the Minister of Internal Affairs.

It must be known that a business permit is required where the company is entirely owned by foreigners or where a foreign entity is engaging in a joint venture with a Nigerian Corporation.


Combined Expatriate Residence Permit and Aliens Card (CERPAC) is the official name for the Residence and Work Permit in Nigeria. It is a card issued to an expatriate or foreigner allowing him to live and work in Nigeria for a specified period of time. In Nigeria, the Comptroller General of Immigration is empowered to issue a Nigerian residence permit under the watch of the Ministry of Interior.

An Expatriate Quota, on the other hand, is an approval granted to companies to employ the services of foreigners with relevant skills with a view to transferring the same to Nigerian understudies. It states the number of foreigners allowed to work in the company and this is done to check the indiscriminate employment of foreigners where there are already competent Nigerians to do the same. Also, it is only granted to registered entities.


Most foreigners setting up a company in Nigeria often require a bank account opening for ease of doing business, although no law mandates that a foreigner should open a bank account. To open a bank account in Nigeria, all foreigners listed as directors of the company enroll for a Bank Verification Number (BVN). Foreigners overseas can also apply for BVN at designated centers abroad. Regardless of having BVN, the Nigerian banks may demand that any foreigner (either as a director or any other staff) seeking to become a signatory to the bank account should maintain a Nigerian residency status (having CERPAC).



A Certificate of Capital Importation better known as CCI is a document obtained from the Central Bank of Nigeria through commercial banks. The certificate proves that cash, equipment or a combination of both from foreign investors have been received by an entity incorporated in Nigeria.

The CCI can be obtained from an authorized dealer (commercial bank).

The CCI confers on the foreign investor the right to repatriate capital, dividends, and profits at the official foreign exchange market rates.



Taxes are administered for the running of the government through the different tiers or levels of government. The local councils manage the local government levies, the state taxes are collected by the State Internal Revenue Services, and the Federal Inland Revenue Services (FIRS) collects and manages federal taxes. Evading the payment of tax attracts fines and other punitive penalties under Nigerian law. All registered companies in Nigeria must register with a nearby tax office and obtain a Tax Identification Number (TIN) before the commencement of business as this unique number enables the payment of taxes.  Some of the most common taxes payable in Nigeria are Company Income Tax (CIT), Personal Income Tax (otherwise known as PAYE Tax), and Value Added Tax (VAT) on vatable products and services.



As shown above, Nigeria operates a free-market economy and readily invites foreign investors to bring in their expertise and investment for the growth of the nation’s economy. This is however subject to all procedures and requirements, which must be duly complied with.


Written by the Corporate & Commercial Law Team at Resolution Law Firm


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