Business may be carried on in Nigeria through a company, a Partnership or a Business Name. The Companies and Allied Matters Act, 2020 [as amended] CAMA provides the legal framework for business formation and regulation in Nigeria.  In Nigeria, the main business entities recognised under CAMA are:

1. Companies

A company is any entity incorporated and registered under CAMA with limited or unlimited liability.  In practice, a foreign investment is usually made through a limited liability company.

The following companies may be registered in Nigeria:

i.  Private limited liability company (Ltd):

• requires a minimum issued share capital of N100,000.
• requires minimum of one (1) and a maximum of fifty (50) shareholders.
• restricts the transfer of its shares
• is prohibited from inviting the public to subscribe to its shares, debentures and/or deposit money for fixed periods or payable at call, whether or not bearing interest.

ii.  Public Limited Liability Company (Plc):

• requires a minimum issued share capital of N2,000,000 with 25% of the share capital allotted to its members at incorporation.
• no restriction on the maximum number of shareholders or their right to transfer their shares freely.
• is permitted to offer its shares and debentures to the public
• must appoint a Company Secretary who is a professional with requisite experience.

iii.  Unlimited liability company (Unltd):

• no limit on the liability of its members.
• its members are like partners and share the company’s liabilities.

iv.  Company limited by guarantee (Gte):

• consent of the Attorney General of the Federation must be obtained to register a Gte.
• generally incorporated as a not-for-profit.
• allowed to do business not for profit but to apply such towards realising its objects.
• no share capital. Members merely undertake to contribute the subscribed amount in the event of its winding up, to a sum not less than N100,000 at all times.
• limits its members’ liability to the amount of their respective guarantees.