In Nigeria, foreign investments have been a great boost to the economy. It is to be noted that Nigeria operates a free market economy hence, there are no restrictions on foreigners starting a business in Nigeria subject to the fulfilment of certain requirements.

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 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.

A foreigner can also enter into a partnership with a Nigerian to form a business. This partnership arrangement may be limited or unlimited. A limited partnership is where a partner’s liability is limited to the value of capital contributed to form the business or unlimited where the partners’ liabilities are not limited.

In registering a business, Section 852 of CAMA provides a guide as to the types of names a company can be registered with.

Notwithstanding the above already stated, section 80 of CAMA provides that a foreign company may be exempted from the registration upon certain grounds.

Section 80 provides as follows:

         (1) A foreign company may apply to the Minister for exemption from the provisions of section 78 of this Act if that foreign company belongs to one of the following categories, that is— (a) foreign companies other than those specified in paragraph (d), invited to Nigeria by or with the approval of the       Federal Government to execute any specified individual project; (b) foreign companies which are in Nigeria for the execution of specific individual loan projects on behalf of a donor country or international organisation; (c)    foreign government-owned companies engaged solely in export promotion activities; and (d) engineering consultants and technical experts engaged on any individual specialist project under contract with any of the governments in the Federation or any of their agencies or with any other body or person,  where such contract has been approved by the Federal Government.


NIPC is an agency of the Federal Government saddled with the responsibility of coordinating and monitoring all foreign investments 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 which 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 guarantee 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 the 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 must have to enrol for Bank Verification Number (BVN). Foreigners in overseas can also apply for BVN at designated centres 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 must 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 the 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 gotten from an authorized dealer (commercial banks).

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) collect and manage federal taxes. Evading the payment of tax attracts fines and other punitive penalties under Nigerian law. All registered businesses must obtain a TIN upon commencement of business as this unique number enables the payment of taxes. Nowadays, TIN comes with a certificate of incorporation after the company is registered. Apart from having TIN, every registered company within 6 months of incorporation must endeavour to register with the nearby FIRS office to the address of business operation or registered address. 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 Services on vatable products and services.


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


Written by Corporate & Commercial Law Team at Resolution Law Firm