Nigerian Laws provide one of the best legal protection for foreign investors in the world.
Nigeria, with a population of 180 million people is a country with the highest GDP in Africa with vast and strong investment potentials in several sectors of the Economy.
It is also projected that the country will be attaining GDP of 690 Billion dollars by 2020 according to Trading economics in December 2018.
This implies that Nigeria has the largest Consumer market in Africa and greatest returns on investment which offers one of the most attractive incentives and also the good legal environment to foreign investors in Africa. This was also highlighted on forbesafrica.com magazine published on April 9 2018, with an headline Focus on Nigeria: Making Nigeria written by Penresa that the revival of Nigeria economy has gained momentum under the guidance of the new government with good prospects.
The 1999 Nigeria constitution gives equal rights and treatment to foreigners and nationals alike. The foreign investor has a right to life, a right to respect for the dignity of his person, he or she has right to personal liberty, right to fair hearing, right to private and family life, right to freedom of thought, right to freedom of conscience and religion, right to freedom and expression and the press, right to freedom of movement and the right to acquire and own moveable and immovable property in Nigeria.
The following are the legal framework and laws protecting foreign investment:
The principal law on foreign investment, Cap N117, LFN 2004 section 22 Nigeria Investment Promotion Act allows foreigners to invest and participate in operations of any Nigeria enterprise 100 percent without any restriction.
We can divide the legal protection into three categories:
- Nigerian Constitution
- Nigerian Domestic laws on foreign investment
- Treaties with countries and international bodies.
Legal Protection Under Nigerian Constitution
Nigerian constitution guarantees that the foreign investor enjoys fair and equitable treatment and he or she enjoys the same rights granted by the law to Nigerians under similar conditions and also the 1999 Nigeria constitution gives equal rights and treatment to foreigners and nationals alike. The foreign investor has a right to life, a right to respect for the dignity of his person, he or she has right to personal liberty, right to fair hearing, right to private and family life, right to freedom of thought, right to freedom of conscience and religion, right to freedom and expression and the press, right to freedom of movement and the right to acquire and own moveable and immovable property in Nigeria.
Legal protection under domestic laws on foreign investment
- Companies and Allies Matters Act Chapter (20) LFN 2004(CAMA): This is the law and principal statutes that protect and govern pre-incorporation, registration, management and winding up of all companies operating in Nigeria. Section 54(1) of the Act provides that every foreign company intending to carry on business in Nigeria must register with Corporate Affairs Commission. It also covers Corporate governance in respect of the management of the company.
- Nigeria Investment Promotion Commission Act Chapter (N117) LFN 2004 NIPC Act: it is the principal law on foreign investment and it's laid out rules and protection of foreign investment in Nigeria. The acts established the regulatory body and provided for various investment incentives and include applicable laws to both direct foreign investment and foreign portfolio investment and it is the most liberal and accessible law to Nigeria economy through direct foreign investment.
- Immigration Act 2015: this is the law in respect of immigrants or foreign investment rights operating or working in Nigeria. This law provides that foreigners planning to take up work or employment in Nigeria are required to have a Resident Permit, Work Permit and other immigration matters issued by Comptroller General of Immigrations.
- Foreign Exchange Monitoring and Miscellaneous Provision Act chapterF34 LFN2004 (FEMM ACT) A foreign investor can bring in capital into the country to finance investment through capital importation and can repatriate back to home country 100 percent he or she earnings or profit without hindrance This act sets out the rules and regulations which govern the operation of the foreign exchange market and provides a framework for remittance of interest, dividends and principal payment in foreign currencies by foreign investors.
- Investment and Securities Act No 29 of 2007 (ISA): The law covers all issues in respect of Securities and Exchange Commission also investments in Capital Market generally including acquisitions, mergers, take-overs and collective investment schemes with robust legal protection for foreign investment.
- The Industrial Development Act LFN 2004: It is a Tax relief Act for investors on the basis of Pioneer Status for the first period of 3-5 years Tax relief or exemption for Tax to encourage the investors.
- Intellectual Property there are adequate laws for the protection of intellectual property rights, trade secret, data protection, technology, creativity and copyright in Nigeria.
- Central Bank of Nigeria Act No 7 of 2007 (CBN ACT): With several reforms introduced by Nigerian Central Bank, it has become very easy for the importation of capital through the new Electronic Capital Importation Certificate and other Cyber Security measures innovated for maximum security protection of foreign investor capital investment in the Nigerian economy. It is the apex regulatory body for banks and financial institutions, also management of monetary, foreign exchange and foreign currency reserve of Nigeria.
Legal Protection Under Treaties
Nigeria is a signatory and party to many multilateral treaties, conventions, trade agreements dealing with disputes between foreign investors and host countries. The 1999 constitution adopted the United Nations Commission on International trade laws. The Arbitration and Conciliation Act. Nigeria laws recognize all treaties, conventions, trade agreements, and respect all signed and adopted international trade rules in respect of foreign investment rights protection.
Therefore, in view of the above, Nigeria is a safe haven for foreign investment. The country's domestic laws guarantee good protection to foreign investment. Nigeria being a signatory to most International Conventions on Foreign Investment present so many business investment opportunities to foreign investors in the largest consumer market in Africa.
In conclusion considering the liberal legal environment and sound legal framework in Nigeria, also taking note of good investment environment with adequate protection of investment by all the laws above; the opportunities to invest in Nigeria are limitless and legal protection guaranteed!
Our firm is a leader in law on foreign direct investment into Nigeria economy; we provide world-class services as the best foreign investment lawyers in Nigeria to consult. We are prepared to assist international & local investors in all aspect of commercial law services relating to compliance and regulations in Nigeria.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.