In recent years, there has been an increase in digital economy innovations: in health care, communications, manufacturing, engineering etc. It is only normal that individuals and companies join in in a bid to contribute their quota and benefit from an ever-booming market. There are various regulatory frameworks for technology in Nigeria with different agencies handling different facets of the technology sector.
We have put together necessary information you should have when setting up a technology company in Nigeria.
1. What are the requirements for incorporating a technology company in Nigeria?
The first step in registering a technology company is registration with the Corporate Affairs Commission (“CAC”).
The most appropriate business structure for a technology company is a company limited by shares (private or public). The incorporation of a company in Nigeria is handled by the Corporate Affairs Commission (“CAC”)
Below are the requirements for registering a company in Nigeria.
- Two proposed names for the company: these names will be submitted to the CAC for name search, screening and approval. Upon approval, the promoters may thereafter proceed to register the manufacturing company with the approved name;
- Proposed Registered Address, Email Address and Phone Number of the Company;
- Details of the Shareholders, Director(s) and Company Secretary to include their Names, Contact/Home Address, Email address, Phone number, Date of birth, Occupation, a copy of Government-issued means of identification (e.g. NIN, Voters card, Data page of International Passport), and Electronic signatures respectively.
- Objects of the Company: Please confirm that the proposed company is being registered as a technology company with specifics on the expertise area.
You can learn more about the requirements for registering a company here.
2. What are the applicable costs of registering a technology company in Nigeria?
There is no specified share capital for technology companies under the extant Companies and Allied Matters Act, 2020 (“2020 CAMA”). However, the minimum share capital for registering a private limited liability company in Nigeria is N100,000 (One Hundred Thousand Naira Only), while the minimum share capital for a public company is N2,000,000 (Two Million Naira Only).
The cost of registering a company in Nigeria is dependent on the amount of share capital of the proposed company and the specific sector in which the technology will be used. For example, financial technology companies acting as Super Agents require a capital threshold of N50,000,000 (Fifty Million Naira) while Payments Solutions Service Providers (PSSPs) require a minimum capital threshold of N100,000,000 (One Hundred Million Naira).
3. What post-incorporation registrations and approvals does a technology company require to operate in Nigeria?
Aside registration with CAC, there are other regulatory agencies in the technology sector that a company must be registered with before commencing business.
Some of the regulatory agencies are highlighted below:
- National Information Technology Development Agency (NITDA)
This agency regulates, licences, and levies operators within the information technology sector. This includes mobile and fixed telecommunications companies, e-commerce companies, digital platform operators and providers, pensions managers and pension-related companies, and banks, financial institutions and companies providing financial services using information technology tools. To learn more about the requirements, costs and timelines for registration with NITDA,
- Nigerian Communications Commission (NCC)
This agency regulates telecommunication service providers. It issues licences to companies operating in the telecommunications industry. Currently, there are two broad classes of licence: Class license and Individual licence.
Licences under Class licence include Internet services, Sales & installation, Unified Access Service License, International Data Access, Interconnect Exchange, International Gateway, Metropolitan (fibre) Cable Network, National Carrier, National Long Distance Communication (NLDC), Value Added Service, Infrastructure Sharing & Collocation Service, Automated Vehicular Tracking Service, Open Access Fibre Infrastructure Network (INFRACOs), Whole Sale Wireless Access Services and Private Network Link (PNL).
Licences under Individual licence include Sales & Installation, Repairs & Maintenance of Telecoms Facilities, Cabling Services, Tele Centre/ Cybercafé and Public Payphone Services.
The requirements for registration with NCC are as follows:
- Application form (obtainable at N1000)
- CAC Incorporation documents
- Tax Clearance Certificate
- Feasibility report of proposed service
- 3 Passport photographs of an authorized representative
- Certificates of qualified technical staff (where applicable)
- Passport photographs of Directors of the company
- Utility bill of the official address of the Company.
- Evidence of funding for the project
The License fee is payable on approval of the application.
- Central Bank of Nigeria (CBN)
The Central Bank of Nigeria regulates banks and financial institutions. This includes FinTech companies involved in mobile money operations and payment solution services. In May 2021, the CBN published new licence requirements for payment system operators in Nigeria. The categories listed include the;
– Payment Terminal Service Provider (PTSP)
– Payment Solutions Service Provider (PSSP)
– Payment Solution Services (PSS)
– Super Agent Licence
– Mobile Money Operator (MMO)
– Switch and Processing Licence
You can read more about the licenses here
4. What is the timeline for processing incorporation registration and licenses for a technology company in Nigeria?
Incorporating a technology company with CAC takes an average of 3 days.
NITDA licence takes an average of 3 – 4 weeks. NCC licence takes an average of 4 – 6 weeks.
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About KORIAT & CO.
We are a commercial law firm with head office in Lagos, Nigeria. We assist clients from different nationalities in company registration and processing of business licence in Nigeria, Ghana, Kenya, Rwanda and Uganda. We also provide company secretarial services and general legal support for registered businesses.
The above article is not legal advice and does not automatically make our readers our clients unless they specifically instruct us to act or represent them in any way.
Please contact Koriat & Co. through admin@koriatlaw.com or 09067842241 (also WhatsApp) if you require additional information about or assistance in registering or getting a fintech licence in either payment or lending sectors.
