Doing Business in Nigeria: A Brief Legal Guide

A Guide to Doing Business in Nigeria

Company structure

The primary law governing companies and businesses in Nigeria is the Companies and Allied Matters Act 2020 (CAMA), which repealed and replaced CAMA 1990. It deals with the types of business structure, eligibility, the registration process and the rules for operation. The regulator responsible for implementing it is the Corporate Affairs Commission (CAC).

The structures available are: registered business name, company limited by shares, company limited by guarantee, unlimited company (all of which may be private or public), limited liability partnership, limited partnership, and incorporated trustees. Limited liability partnerships and limited partnerships are new under CAMA 2020 and are available nationwide, not just in Lagos as was previously the case.

For the purposes of this guide, we will deal only with the private company limited by shares.

What are the requirements?

• Members. One person can now form and incorporate a private company. Under the old law you needed two, which is a rule you will still see repeated in older guides. The maximum for a private company remains 50 members.
• Eligibility. Founding members must not be under 18 (unless at least two other members are of full age and capacity), of unsound mind, an undischarged bankrupt, or disqualified under CAMA from being a director.
• Share capital. CAMA 2020 replaced “authorised share capital” with minimum issued share capital. For a private company this must be at least N100,000, and for a public company at least N2,000,000. At least 25% of issued share capital must be paid up. If you see N10,000 quoted anywhere, that is the repealed 1990 figure.
• Persons with Significant Control. Anyone who owns or controls more than 25% of the company must be disclosed at the point of incorporation.

What documents are needed?

• Memorandum and Articles of Association
• Notice of registered address
• List, particulars and consent of the first directors
• Statement of Compliance

On that last item: CAMA 2020 replaced the old Declaration of Compliance, which had to be sworn by a legal practitioner, with a Statement of Compliance that the applicant or their agent can sign. No lawyer or notary is required.

Which leads to a related correction. You may have read that only accredited lawyers, chartered accountants and chartered secretaries can incorporate a company in Nigeria. That has not been the position since 2020. CAMA 2020 and the CAC’s online portal allow you to register a company yourself, and the CAC says the same for incorporated trustees. Professional help is often worth having — particularly where there are multiple shareholders, unusual share structures, or foreign participation — but it is a choice, not a legal requirement.

Upon successful registration you receive a Certificate of Incorporation, which is now issued electronically with a QR code for verification. One helpful development: from 2026 your CAC registration number also serves as your Tax ID, so there is no separate tax registration step.

Intellectual property protection

Nigerian law protects IP in three main categories: copyright, trademarks and patents.

Copyright

Copyright grants the creator of an original work exclusive rights over its use and distribution for a limited time. Those rights are not absolute and are subject to limitations.

The governing law is now the Copyright Act 2022, which commenced on 17 March 2023 and repealed the Copyright Act Cap C28 LFN 2004. If you are reading older material on Nigerian copyright, this is the change that dates it. The Nigerian Copyright Commission (NCC) administers and enforces the Act.

Copyright vests first in the creator — the “author” — who is free to transfer those rights, in which case the transferee becomes the owner.

What is eligible?

• Literary works
• Musical works
• Artistic works
• Audiovisual works
• Sound recordings
• Broadcasts

Note the change: the old category of “cinematograph films” has been replaced by audiovisual works, which is broader and deliberately covers digital content — video, images, and other online productions that the old definition struggled to reach.

The work must be sufficiently original and must be expressed in some fixed form — writing, a painting, a recording. You cannot have copyright in something that exists only in your head. Originality and expression remain the two pillars.

What the 2022 Act added that matters most

The Act gives copyright owners a new exclusive right to make the work available to the public by wire or wireless means, in a way that lets people access it from a place and at a time of their own choosing. In plain terms, this is the streaming and online distribution right, and the old Act had no clear equivalent. The Act also makes it explicitly unlawful to use internet content — images, films, sound recordings — without the creator’s consent, and introduces an open “fair dealing” exception modelled on US fair use, with a four-factor test to guide the courts.

Do you need to register?

No. Registration is not a precondition for protection. Copyright subsists automatically from the moment a qualifying work is created.

The NCC does operate a voluntary notification scheme, which it justifies on the basis that it provides an independent source of verifying data about a work and its author, that the acknowledgement certificate is prima facie evidence of the facts on it, that it provides a depository for original copies, and that the database offers reliable rights management information to prospective licensees. Registration is done by submitting a completed form, two copies of the work and evidence of payment, online or at an NCC office.

Trademarks

A trademark is a word, phrase, symbol or design, or a combination of these, that identifies and distinguishes one party’s goods from another’s.

Registration lets you take legal action against unauthorised users, sell or licence the mark as an asset, and use the ® symbol.

The governing law is the Trade Marks Act and the Trade Marks Regulations. Registration is handled by the Trademarks, Patents and Designs Registry within the Commercial Law Department of the Federal Ministry of Industry, Trade and Investment. Applications go to the Registrar of Trade Marks.

What is eligible? A device, brand, heading, label, ticket, name, signature, word, letter, numeral or any combination of these. To be registrable it must contain or consist of at least one of the following essential particulars:

• the name of a company, individual or firm represented in a special or particular manner
• the signature of the applicant or a predecessor in the business
• an invented word or words
• a word or words having no direct reference to the character or quality of the goods, and not being, in ordinary signification, a geographical name or a surname
• any other distinctive mark

Do you need to register? Yes. Unlike copyright, trademark protection does not vest automatically. Without registration your only recourse against a copyist is an action in passing off, which is harder and more expensive to run.

The process has three stages:

1. Availability search to identify conflicting marks.
2. Application. If accepted, the registry issues a Letter of Acceptance — approval in principle — and the mark is advertised in the Trade Marks Journal.
3. Certificate. Any interested party may oppose within 2 months of advertisement. If unopposed, you apply to the Registrar for the certificate.

A trademark is valid for an initial 7 years and thereafter renewable for successive 14-year periods.

One development worth knowing: CAMA 2020 strengthened the position of trademark owners against confusingly similar company names. Under the old law the CAC could direct a company to change a name conflicting with a trademark but had no real means of enforcing the direction. CAMA 2020 simplified the procedure for striking such names off the register. If someone registers a company under a name close to your registered mark, you now have a more usable remedy.

Patents

A patent is an exclusive right granted for an invention — a product or process offering a new way of doing something or a new technical solution to a problem. It grants a temporary monopoly on commercial exploitation, letting the holder exclude others from making, using or selling the invention without consent.

The governing law is the Patents and Designs Act, administered by the Trademarks, Patents and Designs Registry. Applications go to the Registrar of Patents and Designs.

What is eligible? For an invention to be patentable it must:

• be new
• involve an inventive step not obvious to a person skilled in the field
• be capable of industrial application, and not be a scientific or mathematical discovery, theory or method, a literary, dramatic, musical or artistic work, a scheme for performing a mental act, playing a game or doing business, the presentation of information, certain computer programs, an animal or plant variety, or a method of medical treatment or diagnosis
• not be contrary to public policy or morality

Do you need to register? Yes. Nigeria operates a first-to-file system — rights vest in the statutory inventor, meaning the first to file. Section 2(2) of the Act allows for redress by reassigning rights to a person adjudged to be the true inventor even where they did not file first, but you should not want to rely on that.

The process: conduct a search first, then file a petition or request signed by the applicant or agent with full name and address; a specification including claims in duplicate; plans and drawings in duplicate if any; where appropriate a declaration by the true inventor asking to be named; a power of attorney if filed by an agent; an address for service in Nigeria if the applicant is abroad; and the prescribed fee.

A patent runs for 20 years from filing — but only if the annual renewal fees are paid. Patents lapse for non-payment more often than people expect, so diarise the renewals.

Insurance

Insurance law in Nigeria changed substantially in 2025. The Nigerian Insurance Industry Reform Act 2025 (NIIRA), which the President signed on 5 August 2025, repealed the Insurance Act 2003 along with the Marine Insurance Act, the Motor Vehicles (Third Party Insurance) Act, the NICON Act and the Nigeria Reinsurance Corporation Act, consolidating them into a single statute. Any guidance citing sections of the Insurance Act 2003 — including earlier versions of this guide — is out of date, and in particular the penalties have risen sharply.

Statutory group life insurance. Section 4(5) of the Pension Reform Act 2014 requires every employer to maintain a group life policy in favour of each employee for a minimum of three times the employee’s annual total emolument. An employer who fails to pay for the policy must meet death claims arising during the period out of its own pocket. NIIRA 2025 also lists group life among the compulsory classes.

Builders’ liability insurance. Cover is compulsory during the construction of any building of more than two floors, protecting against injury, death or property damage caused by negligence. This obligation carried over into NIIRA 2025, which sets out its own penalty regime — the old “N250,000 or 3 years” figure is from the repealed Act.

Occupiers’ liability insurance. Compulsory for all public buildings, meaning any building not used entirely by its owner as a private residence. This covers tenement houses, hostels, buildings occupied by tenants or lodgers, and any building the public enters for educational, recreational, commercial or medical purposes — schools, cinemas, hospitals, malls, petrol stations and so on.

The policy must cover the legal liabilities of both the owner and the occupier for property damage, bodily injury or death suffered by any user of the premises or by third parties, arising from collapse, fire, earthquake, storm, flood and such other hazards as the regulator determines. If you lease your premises, do not assume the landlord’s policy discharges your obligation.

The penalty is now serious: a fine of not less than ₦1,000,000, or imprisonment for up to 12 months, or both. The previous figure was N100,000.

Employee compensation contribution. The Employee’s Compensation Act 2010 requires employers to contribute a minimum of 1% of total monthly payroll to the Employee Compensation Fund, administered by the NSITF, which compensates employees or their dependants for death, injury, disease or disability arising in the course of employment.

Motor third-party liability. Compulsory for all vehicle owners, private or commercial, now under NIIRA 2025 rather than the repealed Insurance Act. It covers death, bodily injury and property damage to members of the public.

Wider compulsory classes. NIIRA 2025 re-stated and extended the compulsory classes to include credit life, petroleum station cover, healthcare professional indemnity and aviation liabilities, and expanded the framework into agriculture, SMEs, public infrastructure and cyber liability. Review your whole insurance position rather than assuming the old list is complete.

Tax

Nigeria’s federal tax system was rewritten with effect from 1 January 2026. Four Acts signed on 26 June 2025 replaced most of the previous code: the Nigeria Tax Act (NTA) 2025, the Nigeria Tax Administration Act (NTAA) 2025, the Nigeria Revenue Service (Establishment) Act 2025 and the Joint Revenue Board (Establishment) Act 2025. The Federal Inland Revenue Service has been renamed the Nigeria Revenue Service (NRS). The Companies Income Tax Act, Personal Income Tax Act, Capital Gains Tax Act, VAT Act and Stamp Duties Act have all been consolidated into the NTA and repealed as standalone statutes.

Nigeria remains a federation, and federal, state and local governments all have taxing powers. This guide covers federal taxes.

Companies Income Tax. Chargeable on the profits of companies registered in Nigeria other than those in petroleum operations. The standard rate is 30%. Small companies pay 0%. The old three-way classification of small, medium and large companies has been abolished — a company is now either small (exempt) or standard (fully liable).

Development Levy. New, and it replaces four separate levies. Section 59 of the NTA imposes a levy of 4% on the assessable profits of all companies other than small companies and non-resident companies. It consolidates the Tertiary Education Tax (3%), the NITDA information technology levy (1%), the NASENI levy (0.25%) and the Police Trust Fund levy (0.005%) — which together came to about 4.25% on overlapping bases. If you are still budgeting separately for education tax or the IT levy, stop; they no longer exist.

Personal Income Tax. Payable by individuals, registered business names and partnerships, administered by the internal revenue service of the relevant state. The Personal Income Tax Act has been repealed and the rules now sit in the NTA, with a more progressive schedule and a substantially higher tax-free band.

Capital Gains Tax. For companies, CGT has risen from 10% to 30%, aligning it with the CIT rate. There is a useful relief: CGT does not apply where the proceeds of a share transfer are reinvested in shares of the same or another Nigerian company within the same year of assessment, and applies proportionately to any portion not reinvested.

Value Added Tax. Still 7.5% — the proposed increase was not carried through. Two changes matter. Input VAT recovery has broadened considerably, so you can now reclaim VAT paid on services and capital expenditure such as equipment, not just goods for resale. And e-invoicing is now mandatory: companies must use the NRS fiscalisation system for VAT, and non-compliance attracts a ₦200,000 fine plus 100% of the tax due plus interest.

Employment

The key statutes for employers are:

• Labour Act, Cap L1 LFN 2004 — protection of employees as to remuneration, terms of employment and related matters.
• Employee’s Compensation Act 2010 — compensation for employees suffering occupational disease or workplace injury.
• Pension Reform Act 2014 — the contributory pension scheme, contribution rates, exemptions, and the regulation of Pension Fund Administrators and Custodians. It also carries the group life obligation described above.
• Industrial Training Fund Act — employer contributions to staff training, applicable once you cross the relevant employee or turnover threshold.
• National Health Insurance Authority Act 2022 — replaced the NHIS Act and made health insurance mandatory.

To this list add PAYE: you must register with the internal revenue service of the state where your employees reside, deduct tax at source and remit it. Failure to deduct and remit is among the most heavily penalised defaults in the tax system.

Data protection

This did not feature in earlier versions of this guide because the law did not exist. It does now, and it applies to almost every business.

The Nigeria Data Protection Act 2023 established the Nigeria Data Protection Commission and created a statutory framework of duties for anyone processing personal data — a lawful basis for processing, data subject rights, security obligations, breach notification, and registration and audit requirements for controllers and processors classified as being of major importance. In March 2025 the Commission issued the General Application and Implementation Directive, which is now the operative framework and which displaced the old NDPR entirely.

If you have employees, customers, a website, CCTV or a mailing list, you are processing personal data. The Commission has spent the early years on education; 2026 is the year it is expected to move to enforcement.

Anti-money laundering

Under the Money Laundering (Prevention and Prohibition) Act 2022, a wide range of non-financial businesses are classified as Designated Non-Financial Businesses and Professions and must register with the Special Control Unit Against Money Laundering (SCUML), which sits under the EFCC. Many banks will not open a corporate account for a business in a designated category without a SCUML certificate. Check whether your sector is caught before you try to open your account.

Regulatory bodies

Businesses in certain sectors are subject to specific regulators, with power to set operating requirements, issue guidelines and impose sanctions. These include:

• Central Bank of Nigeria
• Securities and Exchange Commission
• National Agency for Food and Drug Administration and Control (NAFDAC)
• Nigerian Communications Commission
• National Office for Technology Acquisition and Promotion (NOTAP)
• Standards Organisation of Nigeria
• Federal Competition and Consumer Protection Commission (FCCPC)
• Nigeria Data Protection Commission
• Nigerian Copyright Commission

Two corrections to older versions of this list: NAFDAC is the National Agency for Food and Drug Administration and Control, not “Food, Drug and Cosmetics”; and the Consumer Protection Council was abolished by the Federal Competition and Consumer Protection Act 2018 and replaced by the FCCPC, which has far broader powers including merger review and competition enforcement.

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We hope you have found this information helpful. Please note that this information is provided for general informational purposes only and is not intended to be legal advice. No lawyer-client relationship is formed nor should any such relationship be implied. It is not intended to substitute for the advice of a qualified lawyer. If you require legal advice, please consult with a qualified lawyer.