We explained how to obtain Business Permit as foreigner in Nigeria, the requirements, the cost and the support services. Feel free to contact Aziza Nigeria for your Business Permit processing service. We also explained the requirements for expatriate quota license.
Definition: Nigerian Business Permit
A Nigerian Business Permit is an official authorization issued by the Federal Ministry of Interior that allows foreign-owned companies to legally operate in the country. It is a foundational permit that foreign investors must obtain before they can engage in any business activities within Nigeria.
This authorization is required for any company that is wholly or partly owned by foreigners and intends to establish a business in Nigeria.
Purpose of a Business Permit
- Legal operation: A Business Permit grants a foreign company the legal right to conduct business activities in Nigeria, ensuring it adheres to the country’s laws and regulatory framework.
- Regulatory compliance: The permit allows the government to track business activities and enforce compliance with tax laws, preventing disruptions to operations.
- Gateway to other approvals: It is a prerequisite for a foreign company to apply for an Expatriate Quota, which is necessary to employ foreign staff.
- Monitoring of foreign investment: The permit ensures that foreign companies are not dominating sectors where local businesses can thrive, thereby protecting local employment.
For a foreigner or expatriate entrepreneur to carry out business operation in Nigeria, you he/she will require Nigerian business permit under the name of his/her company from Nigerian Investment Promotion Commission (NIPC).
Complete Guide: How to Start Business in Nigeria as a Foreigner
The Business Permit Processes & Requirements:
To get a business permit as a foreigner in Nigeria, you must first register a company with the Corporate Affairs Commission (CAC). The company must then register with the Nigerian Investment Promotion Commission (NIPC) and apply for a Business Permit from the Ministry of Interior.
Step 1: Incorporate a company with the Corporate Affairs Commission (CAC)
The initial step is to register a limited liability company with the CAC, as a foreign entity cannot conduct business in Nigeria without a locally incorporated company.
Key requirements for a company with foreign participation:
- Minimum share capital: For a company with any foreign participation, the minimum share capital is 100 million share capital.
- Registered address: Provide a physical address for the company in Nigeria.
- Tax registration: After incorporating, the company must obtain a Tax Identification Number (TIN) from the Federal Inland Revenue Service (FIRS) and register for Value Added Tax (VAT).
- Obtain Company Tax Clearance Certificate (TCC) from the Federal Inland Revenue Service (FIRS).
Read: Business Registration/ Entity Formation Services
Step 2: Register with the Nigerian Investment Promotion Commission (NIPC)
Following CAC incorporation, companies with foreign shareholding are required to register with the NIPC. This involves submitting a formal application, NIPC Form I, copies of the Certificate of Incorporation and MEMART, evidence of capital importation (if applicable), and paying the required fees.
Step 3: Obtain a Business Permit from the Ministry of Interior
A business permit from the Ministry of Interior is essential for foreign-owned companies to operate legally in Nigeria. Key requirements include;
- Application letter
- CAC incorporation documents
- Tax Clearance Certificate
- A feasibility report
- Evidence of office space and
- Proof of capital importation or availability.
Business permit application from NIPC in Nigeria usually takes 2 to 3 weeks to complete except where there an issue.
Expatriate Quota
An expatriate quota is an approval granted by Nigeria’s Federal Ministry of Interior that authorizes a company to employ foreign nationals. The quota specifies the number of expatriates a company can hire for designated positions and for a certain duration. The primary purpose is to ensure the transfer of specialized skills and knowledge to Nigerian citizens.
Types of expatriate quotas
- Temporary Quota: A standard approval that is granted for an initial period and is subject to renewal. The maximum lifespan of a temporary position is typically 10 years.
- Permanent Until Reviewed (PUR): A more permanent quota status reserved for top management roles, such as Managing Director or Chairman, to protect investors’ interests.
Read: How to Obtain Nigerian Expatriate Quota
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