Introduction to Nigeria Company Law - Part 2
Introduction to Nigeria Company Law - Part 2
RESTRICTIONS ON COMPANY NAMES
Companies cannot be registered (except with the consent of the commission) with a name that includes the words :
Chamber of Commerce (unless limited by guarantee), Federal , National, Regional, State, Government, Group, Holding, Co-operative, Building Society, Municipal, Chartered or any other word which in the opinion of the commission suggests or is calculated to suggest that it enjoys the patronage of the government of the federation or a state.
- The registered office of the company shall be situated in Nigeria.
- The nature of the business of business which the company is authorized to carry on or if the company is not formed to carry on a business, then the nature of the objects or objects for which it is established
- The restrictions if any on the powers of the company.
- If the company is a private or public company.
- If the liability of the members is limited by share or by guarantee or is unlimited.
If a company has a share capital, the memorandum shall state the amount of authorized capital, not less than N10,000 for a private company and not less than N500,000 for public company.
- The subscribers to the memorandum shall take share amongst themselves not less than 25% of the authorized share capital.
- The memorandum shall be stamped as a deed.
- If a company is limited by garauntee, then its memorandum shall also state that:
The income and property of the company shall be applied solely towards the promotion of its objectives and no portion shall be paid or transferred (directly or indirectly) to the members of the company except as permitted by the decree.
THE ARTICLES OF ASSOCIATION
These are rules which provide for the internal organization of the company. (Sec. 31,1):
the form and contents of the articles of association of a public company having a share capital, a private company having a share capital, a company limited by guarantee and unlimited company shall be as in parts I, II, III, and IV respectively of Table A in schedule 1 with such additions, omissions of alterations as may be required in the circumstances.
These include:
Statutory Requirement:
Restriction on transferability of shares on membership and on public subscription for private companies.
- Share structure or class of shares:
- Insurance and classification of shares.
This is influenced by sec. 141 of the decree.
b. Rights attaching to shares
c. Transfer and transmission of shares
d. Increase and reduction of shares
e. Conversion.
- Commission and Brokerage
Meetings:
a. Types of Meetings
b. Notice for meetings
c. Attendance and proceedings, proxy, voting, and quorum. Upon complying with all the requirements, the commission shall register the company unless:
- they do not comply with the decree
- the business which the company wants to carry on or the objects for which it is formed or any of them are illegal
- any of the subscribers to the memorandum is incompetent or disqualified in accordance with Sect. 20 or non-compliancy with any of the law as to incorporation.
- the proposed name conflicts with or is likely to conflict with existing trade mark or business name registered in Nigeria. Certificate of incorporation shall be the prima facie evidence that all the requirements of the decree have been met.
Sec. 37 stipulates that from the date of incorporation mentioned in the certificate of incorporation the subscriber of the memorandum together with such other persons as may, from time to time become members of the company, shall be a body corporate by the name contained in the memorandum capable forthwith of exercising all the powers and function of an incorporated company including the power to hold land, and having perpetual succession and common seal but with such liability on the part of members to contribute to the success of the company in the event of its being wound-up as mentioned in the Act.
The Act further provides in (Sec. 41,1):
subject to the provisions of this Act, the memorandum and articles when registered, shall have the effect of a contract under seal between the company and its members and officers and between the members and officers themselves whereby they agree to observe and perform the provisions of the memorandum and articles, as agreed from time to time in so far as may relate to the company members, as officer as such.
FOREIGN COMPANIES (54,1)
Every foreign company that is incorporated outside of Nigeria and has the intention of carrying out business in Nigeria shall register a separate entity in Nigeria. Until the separate entity has been registered, the company shall not carry on business, exercise any of the powers of a registered company or have a place of business in Nigeria. Befor incorporation in Nigerai the foreign company can only have an address for the receipt of documents and other notices.
Foreign companies can apply (to the National Council of Ministers) for exemption from the requirements stated above if they; a) have been invited to Nigeria by or with the approval of the Federal Government to execute a specific project. b) are in Nigeria to execute a specifc loan project on behalf of a donor country or international organisation. c) are companies owned by foreign governments and are engaged solely in export promotion activities d) are enengineering consultants and technical experts engaged in any specialised project under contract with any of the governemnts in the federation or any of their agencies. An application for exemption shall be in writing and addresses to the Secretary of Government and should include:
- The name and place of business of the foreign company outside Nigeria
- The name and place of business or the proposed name and place of business of the the foreign company in Nigeria.
- The name and address of each director, partner or other principal officer of the foreign company.
- A certified copy of the charter, statutes, or memorandum and articles of association of the company or any other documents that defines the constitution of the company. If the document is not in English then a certified translation is required.
- The names and addresses of one or more person resident in Nigeria that are authorised to accept notices on behalf of the foreign company.
- The business or proposed business of the foreign company in Nigeria and the duration of such business.
- The particulars of any project previously carried out by the company as an exempted foreign company
- Any other particulars that may be required by the Secretary to the Government
The National Council of Ministers may at anytime revoke any exemption granted to any foreign company, if it is of the opinion that the company has failed to fulfil any condition contained in its exemption order or for any other good or sufficient reason.
RESTRICTIONS ON COMPANY NAMES
Companies cannot be registered (except with the consent of the commission) with a name that includes the words :
Chamber of Commerce (unless limited by guarantee), Federal , National, Regional, State, Government, Group, Holding, Co-operative, Building Society, Municipal, Chartered or any other word which in the opinion of the commission suggests or is calculated to suggest that it enjoys the patronage of the government of the federation or a state.
- The registered office of the company shall be situated in Nigeria.
- The nature of the business of business which the company is authorized to carry on or if the company is not formed to carry on a business, then the nature of the objects or objects for which it is established
- The restrictions if any on the powers of the company.
- If the company is a private or public company.
- If the liability of the members is limited by share or by guarantee or is unlimited.
If a company has a share capital, the memorandum shall state the amount of authorized capital, not less than N10,000 for a private company and not less than N500,000 for public company.
- The subscribers to the memorandum shall take share amongst themselves not less than 25% of the authorized share capital.
- The memorandum shall be stamped as a deed.
- If a company is limited by garauntee, then its memorandum shall also state that:
The income and property of the company shall be applied solely towards the promotion of its objectives and no portion shall be paid or transferred (directly or indirectly) to the members of the company except as permitted by the decree.
THE ARTICLES OF ASSOCIATION
These are rules which provide for the internal organization of the company. (Sec. 31,1):
the form and contents of the articles of association of a public company having a share capital, a private company having a share capital, a company limited by guarantee and unlimited company shall be as in parts I, II, III, and IV respectively of Table A in schedule 1 with such additions, omissions of alterations as may be required in the circumstances.
These include:
Statutory Requirement:
Restriction on transferability of shares on membership and on public subscription for private companies.
- Share structure or class of shares:
- Insurance and classification of shares.
This is influenced by sec. 141 of the decree.
b. Rights attaching to shares
c. Transfer and transmission of shares
d. Increase and reduction of shares
e. Conversion.
- Insurance and classification of shares.
- Commission and Brokerage
Meetings:
a. Types of Meetings
b. Notice for meetings
c. Attendance and proceedings, proxy, voting, and quorum. Upon complying with all the requirements, the commission shall register the company unless:
- they do not comply with the decree
- the business which the company wants to carry on or the objects for which it is formed or any of them are illegal
- any of the subscribers to the memorandum is incompetent or disqualified in accordance with Sect. 20 or non-compliancy with any of the law as to incorporation.
- the proposed name conflicts with or is likely to conflict with existing trade mark or business name registered in Nigeria. Certificate of incorporation shall be the prima facie evidence that all the requirements of the decree have been met.
Sec. 37 stipulates that from the date of incorporation mentioned in the certificate of incorporation the subscriber of the memorandum together with such other persons as may, from time to time become members of the company, shall be a body corporate by the name contained in the memorandum capable forthwith of exercising all the powers and function of an incorporated company including the power to hold land, and having perpetual succession and common seal but with such liability on the part of members to contribute to the success of the company in the event of its being wound-up as mentioned in the Act.
The Act further provides in (Sec. 41,1):
subject to the provisions of this Act, the memorandum and articles when registered, shall have the effect of a contract under seal between the company and its members and officers and between the members and officers themselves whereby they agree to observe and perform the provisions of the memorandum and articles, as agreed from time to time in so far as may relate to the company members, as officer as such.
FOREIGN COMPANIES (54,1)
Every foreign company that is incorporated outside of Nigeria and has the intention of carrying out business in Nigeria shall register a separate entity in Nigeria. Until the separate entity has been registered, the company shall not carry on business, exercise any of the powers of a registered company or have a place of business in Nigeria. Befor incorporation in Nigerai the foreign company can only have an address for the receipt of documents and other notices.
Foreign companies can apply (to the National Council of Ministers) for exemption from the requirements stated above if they; a) have been invited to Nigeria by or with the approval of the Federal Government to execute a specific project. b) are in Nigeria to execute a specifc loan project on behalf of a donor country or international organisation. c) are companies owned by foreign governments and are engaged solely in export promotion activities d) are enengineering consultants and technical experts engaged in any specialised project under contract with any of the governemnts in the federation or any of their agencies. An application for exemption shall be in writing and addresses to the Secretary of Government and should include:
- The name and place of business of the foreign company outside Nigeria
- The name and place of business or the proposed name and place of business of the the foreign company in Nigeria.
- The name and address of each director, partner or other principal officer of the foreign company.
- A certified copy of the charter, statutes, or memorandum and articles of association of the company or any other documents that defines the constitution of the company. If the document is not in English then a certified translation is required.
- The names and addresses of one or more person resident in Nigeria that are authorised to accept notices on behalf of the foreign company.
- The business or proposed business of the foreign company in Nigeria and the duration of such business.
- The particulars of any project previously carried out by the company as an exempted foreign company
- Any other particulars that may be required by the Secretary to the Government
The National Council of Ministers may at anytime revoke any exemption granted to any foreign company, if it is of the opinion that the company has failed to fulfil any condition contained in its exemption order or for any other good or sufficient reason.
RESTRICTIONS ON COMPANY NAMES
Companies cannot be registered (except with the consent of the commission) with a name that includes the words :
Chamber of Commerce (unless limited by guarantee), Federal , National, Regional, State, Government, Group, Holding, Co-operative, Building Society, Municipal, Chartered or any other word which in the opinion of the commission suggests or is calculated to suggest that it enjoys the patronage of the government of the federation or a state.
If a company has a share capital, the memorandum shall state the amount of authorized capital, not less than N10,000 for a private company and not less than N500,000 for public company.
The income and property of the company shall be applied solely towards the promotion of its objectives and no portion shall be paid or transferred (directly or indirectly) to the members of the company except as permitted by the decree.
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THE ARTICLES OF ASSOCIATION
These are rules which provide for the internal organization of the company. (Sec. 31,1):
the form and contents of the articles of association of a public company having a share capital, a private company having a share capital, a company limited by guarantee and unlimited company shall be as in parts I, II, III, and IV respectively of Table A in schedule 1 with such additions, omissions of alterations as may be required in the circumstances.
These include:
Statutory Requirement:
Restriction on transferability of shares on membership and on public subscription for private companies.
This is influenced by sec. 141 of the decree.
b. Rights attaching to shares
c. Transfer and transmission of shares
d. Increase and reduction of shares
e. Conversion.
Meetings:
a. Types of Meetings
b. Notice for meetings
c. Attendance and proceedings, proxy, voting, and quorum. Upon complying with all the requirements, the commission shall register the company unless:
Sec. 37 stipulates that from the date of incorporation mentioned in the certificate of incorporation the subscriber of the memorandum together with such other persons as may, from time to time become members of the company, shall be a body corporate by the name contained in the memorandum capable forthwith of exercising all the powers and function of an incorporated company including the power to hold land, and having perpetual succession and common seal but with such liability on the part of members to contribute to the success of the company in the event of its being wound-up as mentioned in the Act.
The Act further provides in (Sec. 41,1):
subject to the provisions of this Act, the memorandum and articles when registered, shall have the effect of a contract under seal between the company and its members and officers and between the members and officers themselves whereby they agree to observe and perform the provisions of the memorandum and articles, as agreed from time to time in so far as may relate to the company members, as officer as such.
TOP
FOREIGN COMPANIES (54,1)
Every foreign company that is incorporated outside of Nigeria and has the intention of carrying out business in Nigeria shall register a separate entity in Nigeria. Until the separate entity has been registered, the company shall not carry on business, exercise any of the powers of a registered company or have a place of business in Nigeria. Befor incorporation in Nigerai the foreign company can only have an address for the receipt of documents and other notices.
Foreign companies can apply (to the National Council of Ministers) for exemption from the requirements stated above if they; a) have been invited to Nigeria by or with the approval of the Federal Government to execute a specific project. b) are in Nigeria to execute a specifc loan project on behalf of a donor country or international organisation. c) are companies owned by foreign governments and are engaged solely in export promotion activities d) are enengineering consultants and technical experts engaged in any specialised project under contract with any of the governemnts in the federation or any of their agencies. An application for exemption shall be in writing and addresses to the Secretary of Government and should include:
The National Council of Ministers may at anytime revoke any exemption granted to any foreign company, if it is of the opinion that the company has failed to fulfil any condition contained in its exemption order or for any other good or sufficient reason.
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