Below is a detailed summary of the bureaucratic and legal hurdles an entrepreneur must overcome in order to incorporate and register a new firm, along with their associated time and set-up costs. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy’s per-capita gross national income.
The information appearing on this page was collected as part of the Doing Business subnational project in Nigeria. Download this Doing Business report or explore other cities and topics.
Legal form: Private Limited Liability Company
Paid-in minimum capital requirement:
City: Kwara (Ilorin)
Procedure 1: Reserve a unique company name at the Corporate Affairs Commission.
The Corporate Affairs Commission online system allows for online search of unique company names upon the purchase of an e-payment card for a flat fee of NGN 500 from an accredited bank. Until now the system is not fully operational either because of power fluctuation or network failures, applicants may have to go to the CAC office to complete this procedure. The time to conduct the availability of name search, receive confirmation and reserve the company name is usually 5 days. The company’s name reservation lasts 60 days but can be renewed for a similar period.
Time to Complete: 5 days
Associated Costs: NGN 500
Procedure 2: Prepare the requisite incorporation documents and pay the stamp duty.
This procedure involves the following tasks:
- Preparing and printing the memorandum and articles of association;
- Completing the requisite statutory forms, and;
- Having the memorandum and articles of association stamped by the Federal Inland Revenue Service.
There is now a stamp duty office in Kwara state.
Time to complete: 4 days
Associated Costs: NGN 18,181 (stamp duty of 0.75% per share capital + NGN 1,000 for stamping of two extra copies of memorandum and articles of association + NGN 500 for incorporation forms)
Procedure 3: Sign the declaration of compliance (Form CAC 4) before a Commissioner for Oaths or notary public
A declaration that the requirements of the Companies and Allied Matters Act have been met must be sworn by (i) a barrister or solicitor engaged in the formation of the company or (ii) by a person named in the memorandum and articles of association as a director or secretary of the company. This procedure can be done before a notary public or filed at the state or federal High Court. The common practice is for this declaration to be sworn before a Commissioner for Oaths at the state High Court.
Time to complete: 1 days
Associated Costs: NGN 50
To be continued