Registration of a private limited company in Nigeria has further been revamped by the Companies and Allied Matters Act 2020 and Companies Regulations 2021 made according to the Act. Formation of LLC in Nigeria can now be carried out entirely online by the law company laws. The Corporate Affairs Commission (CAC) is the body charges with the responsibilities of regulating and supervising the formation and incorporation of companies in Nigeria. Under the Companies Regulations 2021, the following steps are the procedures involved in the registration of a private limited company in Nigeria starting from January 2021.
- Step 1 – the applicant is required to choose two suitable proposed names for the company, after which he has to check for availability of the proposed name, this will be conducted on the CAC online portal to find out if the name is available and has not already been used.
- Step 2 - Complete
pre-registration form CAC1.1 – this is now to be done only
Online using the Company Registration Portal, the applicant has to
fill in all the required information, such as the approved company
name, after which he is expected to click the type of company in
this case private company limited, the applicant is to show the
trade classification code number, or where he cannot determine that
provide a brief description of the company's business activity,
the applicant is also to provide the registered office address one
easily traceable, the companies email address and phone number, the
company's head office address where this is different from the
registered office address. In completing the form, the applicant
must observe the following procedures:
- The applicant is required to prepare the Company's Memorandum and Article of Association (MEMART) advisable to be drafted professionally by a Legal Practitioner. Nevertheless, the CAC has provided a generic MEMART, which can be adopted entirely or with addition/amendments by the new company.
- The applicant is to proceed to the section for proposed officers, for small private companies, the appointment of a secretary is now optional for a small company, but where the company decides to appoint a secretary, the applicant must provide the relevant details of the secretary. Where the secretary is an individual, the applicant is required to fill Section B1 while for corporate secretary section C1.
- The applicant is also required to fill section D1, by providing the particulars of at least one Director for small companies, this is by virtue of Section 271 of Companies and Allied Matters Act (CAMA) 2020, which excludes small companies from the previous requirement of having a minimum of two (2) directors and Section 18 of CAMA 2020, which provides that one person can form and incorporate a private company, the combine implication of these provisions is that a single person can be the sole director and also the only shareholder in a private limited company.
- The applicant is to proceed to Part 3 of the form, where he is required to fill in the statement of issued share capital which includes the class of shares, nominal values of issued shares, total numbers, aggregate nominal value, the total aggregate amount to be unpaid if any.
- The applicant is to proceed to part 5 of the pre-incorporation form where he is required to fill in the particulars for natural persons and for legal entities (if any) who is a person of significant control.
- The details of the person who presented the registration for filing must also be completed on the form.
- Step 3 - Pay filing and Stamp duty fee as prescribed by CAC and the Federal Inland Revenue Service (FIRS).
- Step 4 – Prepare the signed and
scan copy of pre-registration documents for upload for processing.
In all, the following documents must be uploaded:
- Form CAC1.1
- Memorandum and Article of Association (MEMART).
- Recognized form of identification for Director(s)/Subscriber(s) or Secretary where appointed.
- Evidence of payment to the Corporate Affairs Commission.
- Step 5- Collect your pre-incorporation Certificate and the Certified True Copies of the documents.
In conclusion, there are commendable innovations in the new CAMA 2020 and Companies Regulations 2021, which have made registration of private limited companies easier. With the new procedures, an individual may undertake the incorporation process directly, however, it is always preferable to engage a CAC accredited agent for the process since they have the expertise on such process. Moreover, an accredited agent who is a legal practitioner may advise on the type of business structure suitable for the applicant, the drafting of Articles of Association and also share capital threshold applicable to a type of business.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.