(Demystifying Company Registration in Nigeria: Get Incorporated in 3 easy steps)
Are you ready to register your company with the Corporate Affairs Commission (CAC) but confused as to how it is done? This article will show you the simple 3- step procedure to get it done. But first, let’s bust a couple of myths.
Myth 1: Anyone can walk in and register a company
While it is possible for anyone to walk into CAC, the best most people will achieve is getting answers to questions. Only individuals and firms accredited by CAC will be able to register a company using their accreditation numbers.
Myth 2: You can register online
Most people believe that company registration can be done online via the Corporate Affairs Commission website. It is not possible, although the Commission is definitely working to make it possible. However when it is active, it is still only accredited individuals or firms that will have access to it.
Now that we’ve cleared that up, let’s get your company registered!
Step 1- Get your name
To get a name for your company you have to run what is called an Availability Search. You provide 2 possible names to your lawyer and he takes them to CAC where the search is carried out to ensure that at least one of the names is available for you to use. One or both names can be rejected- which means that you will have to submit fresh names.
Why is a name rejected?-
- if it exists or resembles an existing name such that it is able to cause confusion, (e.g. Tomline and Tomsline)
- if the name is vague
- if one of the words in the name is prohibited (you cannot use words like ‘national’, ‘federal’, ‘government’ or ‘holdings’ without special permission)
Ordinarily, the search result comes out in one week (5 working days) for availability, but if the CAC server is down it may take longer. Once you have an approved name, you are ready for the next step.
Step 2- Prepare memorandum and articles of association (MEMART)
This is done by your lawyer. He will prepare the documents based on the objects of the company. You will need to give the lawyer the names of initial subscribers who will be the first directors and the names of shareholders.
Your initial directors/subscribers must be above 18, and must not be bankrupt, of unsound mind, or convicted of any crime; particularly of moral turpitude.
As of January 2013, all directors need to provide regulatory ID- drivers licence, national identity card, or national passport- so that the CAC officials can see faces and estimate ages.
When through with your MEMART, you need one more document before your lawyer returns to CAC: the incorporation forms.
Step 3- Fill incorporation forms
You will need to appoint a company secretary, who should be either a lawyer or an accountant. This is the person who should handle your filings with CAC after the company has been created.
- All directors must fill the Particulars of Director form (Form CAC 7)
- One director fills the Statement of Share Capital and Return of Allotment form (Form CAC 2)
- One director and the Company Secretary will fill the Notice of Situation/Change of Registered Address form (Form CAC 3)
- An individual or firm accredited by CAC will fill the Declaration of Compliance with the Requirements of CAMA form (Form CAC 4)
- At least two directors will fill the form appointing a Company Secretary for the company.
When all that is done, your lawyer returns to CAC and submits the MEMART and forms. Then in about four to six weeks he returns to get the Certificate of Incorporation. Congratulations on registering your Company!
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This article was first published on 26th July 2013
pagboga
Chojare Pamela Agboga is a Legal Practitioner, Writer, Editor, Chartered Secretary and Administrator. She is currently working on her first novel 'Weekends are for Loving' as well as a devotional for women.
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(Demystifying Company Registration in Nigeria: Get Incorporated in 3 easy steps)
Are you ready to register your company with the Corporate Affairs Commission (CAC) but confused as to how it is done? This article will show you the simple 3- step procedure to get it done. But first, let’s bust a couple of myths.
Myth 1: Anyone can walk in and register a company
While it is possible for anyone to walk into CAC, the best most people will achieve is getting answers to questions. Only individuals and firms accredited by CAC will be able to register a company using their accreditation numbers.
Myth 2: You can register online
Most people believe that company registration can be done online via the Corporate Affairs Commission website. It is not possible, although the Commission is definitely working to make it possible. However when it is active, it is still only accredited individuals or firms that will have access to it.
Now that we’ve cleared that up, let’s get your company registered!
Step 1- Get your name
To get a name for your company you have to run what is called an Availability Search. You provide 2 possible names to your lawyer and he takes them to CAC where the search is carried out to ensure that at least one of the names is available for you to use. One or both names can be rejected- which means that you will have to submit fresh names.
Why is a name rejected?-
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The truth is, it’s very simple. Some major things are required:
1. Valid ID
Driver’s license, international passport, national ID or permanent voters card.
Other things (not required in all cases) may include:
* Academic or Professional certificate
Only required if you want to register a specialized company that offers consultancy and expert services in certain fields (e.g. Audit, Engineering, Medical services, ICT). Certificate can be a university degree or HND, or professional certification.
* Passport photographs
Only required if you are registering a Business Name
* An address
You don’t have to open a shop or get an office space in advance. Your residential apartment (rented or owned) will do.
Any other requirements apart from the above means you are intending to register a company that is beyond the ordinary.
Two types of registrations exist for a profit oriented business
1. Business Name
This is typically the sole proprietorship or partnership business types that we are all familiar with. Many professional consultants register this type; including chartered accountants and legal practitioners.
This is also the choice for starter low budget businesses; the certificate issued along with its documents can be used to obtain a corporate bank account, TAX Identification Number (TIN), and Tax Clearance Certificate (TCC).
Cummulative Cost of registering is typically below N20,000 if you go to CAC by yourself, which you can do without any agent or lawyer.
2. Limited Company
This is the preferred choice for you if you are ready for a full scale business. This carries more recognition in the Nigerian business environment. It needs at least two people to set up, and a third person to be the secretary (a CAC accredited agent ). It can be public PLC or private LTD. My focus here is the private company.
You need a CAC accredited agent here, that is the policy. Charges are always negotiable with the agent depending on the circumstances and other services but average is between N60,000 and N75,000.
It takes between two to five weeks to complete registration with CAC depending on the the state office and the readiness and accuracy of the required documents.
You can visit http://www.benniesmasterpiece.net/index/company-incorporation/ for more information, too.
Call or text in case you need more information or assistance.
08188887911
BBM: 58B0A621