If an individual or group of entrepreneurs intend to start a business in Nigeria, there are several variables to consider. Below are some of them:
1. Applicable Laws: Disobedience of laws regulating business activities in Nigeria can cost individuals a fortune in the long run. As such, before setting out, a prospective business owner should appreciate certain provisions of the laws regulating businesses in Nigeria.
The principal law regulating businesses in Nigeria is the Companies and Allied Matters Act 2004. Depending on the nature of your business, there are several other laws that you have to be familiar with.
2. Your Business Name: Another important consideration is the Identity and Name that will be used for the business.
A research should be conducted to ensure that the name is not already in use by another business. There should also be a confirmation that the name is not restricted or prohibited by law.
One way to ensure that the name is not already in use is to make a public search with the Corporate Affairs Commission.
3. Type of Business Entity: Businesses in Nigeria are primarily structured under three classifications: Sole Proprietorships, Partnerships, and Limited Liability Companies.
Before starting a business, an entrepreneur should consider the appropriate structure for the business.
The right structure is usually determined by several factors such as; number of people involved, nature of business, amount of capital, etc.
4. Required Documents: All necessary documents required for the registration must be available and submitted as required by the Corporate Affairs Commission. The type of documents to be submitted is dependent on the business structure chosen. For instance, if an individual have chosen to register a Limited Liability Company, some of the documents needed are Articles of Association, Memorandum of Association, Particulars of directors, etc.
5. Employment and Tax Laws: An individual must be conversant with employment and tax laws and implications before starting a business. He must know the tax exposures and when they are due in order to avoid being guilty of tax evasion.
An appreciation of employment laws keeps entrepreneurs informed on employment requirements, terms and conditions.
This blog post sheds some light on the important legal issues an entrepreneur must consider before starting a business in Nigeria.
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