NIGERIA LAW AND PRACTICE Contributed by: Chinyerugo Ugoji, Tiwalola Osazuwa, Rebecca Ebokpo, Jibrin Dasun, Peretimi Akinmodun, Onyinyechi Chima and Princess Otah, ǼLEX
in the Federation or any of their agencies, or with any other body or person where such contract has been approved by the federal government. Where the foreign investment involves a merger (whether a small or large merger), the approval of the Federal Competition and Consumer Pro - tection Commission (FCCPC) will be required. Negative List The NIPC Act outlines a “negative list” of enter - prises in which both foreign and Nigerian inves - tors are prohibited from investing. These items are primarily related to national security and public morality, and include: • the production of arms, ammunition, etc; • the production of, and dealing in, narcotic drugs and psychotropic substances; • the production of military and paramilitary clothing and accoutrements, including those of the police and the customs, immigration and prison services; and • such other items as the Federal Executive Council may determine from time to time. Sector-Specific Restrictions There are also some Nigerian laws that restrict and limit the capacity of foreigners to invest in the following sectors in Nigeria: • oil and gas – to be competitive in the award of contracts, at least 51% of the shares of a company must be owned by Nigerians; • coastal trading – the Coastal and Inland Shipping (Cabotage) Act restricts the use of foreign-owned or manned vessels for coastal trade in Nigeria; • broadcasting – a company applying for a broadcasting licence must demonstrate that it is not representing any foreign interests and
that it is substantially owned and operated by Nigerians; • advertising – only a national agency (ie, an agency in which Nigerians own not less than 74.9% of the equity) can advertise to the Nigerian market; • private security – a foreign investor cannot acquire an equity interest in, or sit on the board of, a Nigerian private security com - pany; • engineering services – a company engaged in engineering services must be registered with the Council for the Regulation of Engineering in Nigeria (COREN) and to do so must have Nigerian directors registered with the COR - EN holding at least 55% of the company’s shares; and • aviation – to qualify for the grant of an aviation licence or permit, the Nigerian Civil Aviation Authority must be satisfied that an applicant is a Nigerian citizen or, in the case of a corporate body, a company that is reg - istered in Nigeria and controlled by Nigerian nationals. 2.2 Procedure and Sanctions in the Event of Non-Compliance Generally, approvals are obtained from the nec - essary regulatory governmental bodies after incorporating a company at the CAC. The two major post-incorporation permits required are a business registration certificate from the NIPC and a business permit from the Federal Ministry of Interior. An enterprise with foreign participation must apply to the NIPC for registration before com - mencing business. However, where an enterprise has commenced business but subsequently secures foreign participation, such enterprise is required to register with the NIPC within three months of such acquisition. Such entity must
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