EXCEPTIONS TO INCORPORATING A FOREIGN COMPANY IN NIGERIA

The general rule on foreign companies in Nigeria is that every foreign company intending to carry out business must be incorporated just as a Nigerian company will be incorporated before carrying on business activities (section 54 Companies and Allied Matters Act, 1990 (CAMA)). Upon incorporation, the newly formed company has a separate legal entity different from its foreign parent company. However, there are instances where a foreign company need not be incorporated as a Nigerian company. These instances, as provided by section 56 (1) CAMA include:

1. a foreign company invited to Nigeria by or with the approval of the Federal Government to execute any specified individual project
2. foreign companies which are in Nigeria for the execution of specific individual loan project on behalf of a donor country or individual organization
3. foreign government-owned companies engaged in export promotion activities
4. engineering consultants and technical experts engaged in any individual specialist project under contract with any of the governments in the Federation or any of their agencies or with any other body or person, where such contract has been approved by the Federal Government.

A foreign company may apply to the Federal Government to enjoy any of these exceptions. By section 56(2), an application for exemption under this section shall be in writing addressed to the Secretary to the Federal Government and shall include-

1. the name and place of business of the foreign company outside Nigeria
2. the name and place of business or the proposed name and place of business of the foreign company in Nigeria
3. the name and address of each director, partner or other principal officers of the foreign company
4. a certified copy of the charter, statutes, or memorandum and articles of association
5. of the company, or other instrument constituting or defining the constitution of the company
6. and if the instrument is not written in the English language, a certified translation thereof
7. the names and addresses of one or more persons resident in Nigeria authorized to accept on behalf of the foreign company services of process and any notices required to be served on the company
8. the business or proposed business in Nigeria of the foreign company and the duration of such business
9. particulars of any project previously carried out by the company as an exempted foreign company
10. such other particulars as may be required by the Secretary to the Federal Military Government.

The exemption granted to any foreign company may be revoked at any time if the company fails to fulfill any condition contained in its exemption order or for any other good or sufficient reason.

Kindly click here for the previous post on foreign companies carrying on business in Nigeria.