Six steps every Nigerian business owner must take to keep business legally active
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The Corporate Affairs Commission (CAC) has intensified its crackdown on inactive Nigerian businesses, striking them off its register in a process known as “striking off.”
Once delisted, a company loses its legal status and is considered non-existent in law—often discovered by business owners only when applying for loans, courting investors, or bidding for contracts.
To stay compliant and avoid delisting, entrepreneurs must follow six key steps under the Companies and Allied Matters Act (CAMA) 2020:
1. Choose a Unique Name – Select two distinct names and confirm availability on the CAC portal. Approved names can be reserved for 60 days for ₦500. Names must not duplicate or mislead under Section 30 of CAMA.
2. Prepare Governing Documents – Draft the Memorandum of Association (business objectives, share capital) and Articles of Association (internal governance). These must follow Sections 27–28 of CAMA and be signed by promoters.
3. Declare Share Capital – Private companies must have a minimum of ₦100,000 share capital. The higher the share capital, the higher the filing fees and stamp duty.
4. Appoint Directors and Shareholders – Provide details of at least two directors (or one for small companies) and one shareholder. Directors must be over 18, of sound mind, and not disqualified under the Act.
5. Submit Registration – Upload CAC Form CAC1.1, governing documents, and directors/shareholders’ details via the CAC portal, then pay statutory fees and duties.
6. Post-Registration Compliance – After incorporation, businesses must register for a Tax Identification Number (TIN), secure permits where necessary, and file annual returns within 42 days of each anniversary. They must also declare Persons with Significant Control (PSC) and keep fees up to date.
Failure to meet these requirements risks delisting, leaving a company invisible in law and unable to operate formally.
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