{"id":5669,"date":"2016-12-06T10:04:32","date_gmt":"2016-12-06T10:04:32","guid":{"rendered":"http:\/\/localhost\/test_manager\/business-tips-doing-business-in-nigeria\/"},"modified":"2019-07-10T09:56:32","modified_gmt":"2019-07-10T09:56:32","slug":"business-tips-doing-business-in-nigeria","status":"publish","type":"post","link":"https:\/\/managersoffice.net\/el\/business-tips-doing-business-in-nigeria\/","title":{"rendered":"Business Tips: Doing Business in Nigeria"},"content":{"rendered":"

BUSINESS ENVIRONMENT<\/strong><\/span><\/span><\/p>\n

Nigeria\u2019s economy has much in common with those of China, Malaysia, Brazil and India.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span>Free enterprise is the norm, although there are a number of important economic sectors\u00a0<\/span><\/span>such as telecommunications, electricity and water that have been or continue to be wholly\u00a0<\/span><\/span>or partially government-owned and controlled. The government\u2019s policy is to promote the\u00a0<\/span><\/span>commercialisation, restructuring and privatisation of certain government-owned\u00a0<\/span><\/span>enterprises.<\/span><\/span><\/p>\n

ECONOMY<\/strong><\/span><\/span><\/p>\n

ECONOMIC STRUCTURE<\/strong><\/span><\/span><\/p>\n

Recently, Nigeria has become the largest economy in Africa after rebasing its gross\u00a0<\/span><\/span>domestic product (GDP). Rebasing captured the structural changes in the economy\u00a0<\/span><\/span>especially in the banking, telecom and entertainment sectors, where Nigeria recorded\u00a0<\/span><\/span>dramatic growth in recent years. Nigeria gross domestic product is now $510 billion.<\/span><\/span><\/p>\n

IMPORTS AND EXPORTS<\/strong><\/span><\/span><\/p>\n

Most of Nigeria\u2019s exports to industrialised countries consist of primary and intermediate\u00a0<\/span><\/span>commodities. A large proportion of exports consist of unprocessed raw materials, with the\u00a0<\/span><\/span>oil and gas industry contributing the greatest proportion to the country\u2019s total exports.<\/span><\/span><\/p>\n

Nigeria is a major exporter of crude oil. The country is also an exporter of cocoa, rubber,\u00a0<\/span><\/span>cashew nuts and raw timber. It has the world\u2019s third largest film production industry after\u00a0<\/span><\/span>the United States and India, becoming a major exporter of movies.<\/span><\/span><\/p>\n

Imports include mainly capital goods, food products, refined petroleum and intermediate\u00a0<\/span><\/span>goods.<\/span><\/span><\/p>\n

SETTING UP A BUSINESS<\/strong><\/span><\/span><\/p>\n

COMPANIES<\/strong><\/span><\/span><\/p>\n

The most common form of business entity in Nigeria is the limited liability company.<\/span><\/span><\/p>\n

Companies can be limited by guarantee or limited by shares. Companies limited by\u00a0<\/span><\/span>guarantee are generally not-for-profit organisations that primarily promote religious,\u00a0<\/span><\/span>charitable, educational and\/or other similar interests. The names of companies limited by\u00a0<\/span><\/span>guarantee must end with the words \u2018Limited by Guarantee\u2019.<\/span><\/span><\/p>\n

Companies having share capital may be public or private companies. The name of a public\u00a0<\/span><\/span>company must end with the word \u2018Public Limited Company\u2019 usually abbreviated to \u2018PLC\u2019\u00a0<\/span><\/span>whereas private companies must end with the words \u2018Limited\u2019.<\/span><\/span><\/p>\n

For a private company, the minimum number of shareholders is 2 and of directors also 2,\u00a0<\/span><\/span>while a public company may have an unlimited number of shareholders and as many\u00a0<\/span><\/span>directors as desired.<\/span><\/span><\/p>\n

Directors need not own shares in the company and need not be resident in Nigeria, but a\u00a0<\/span><\/span>Nigerian resident must be appointed as the Company Secretary of the company. The\u00a0<\/span><\/span>company secretary of a public company must be a Nigerian resident. The board of directors\u00a0<\/span><\/span>is responsible for the daily management of the company for the benefit of its shareholders\u00a0<\/span><\/span>and acts for the company in transactions entered into by it. The shareholders exercise their\u00a0<\/span><\/span>powers in general meetings. The annual general meeting must be held within nine months\u00a0<\/span><\/span>of the financial year end and not more than 15 months after the last meeting. Shareholders\u00a0<\/span><\/span>may be individuals or corporate bodies, and any or all of the company\u2019s shares may be held\u00a0<\/span><\/span>by non-residents.<\/span><\/span><\/p>\n

The principle that a company is a separate entity and exists separately from its\u00a0<\/span><\/span>shareholders, applies to both private and public companies. A company can enter into\u00a0\u00a0<\/span><\/span>contracts and can sue or be sued in its own name. A shareholder\u2019s liability for the debts of\u00a0<\/span><\/span>the company is limited to the amount of capital they have invested in the shares.<\/span><\/span><\/p>\n

A director may be held liable to indemnify the company or its shareholders against losses\u00a0<\/span><\/span>suffered by them in the following circumstances (amongst others):<\/span><\/span><\/p>\n