Incorporating Your Own Company - Part 2

……Continued from last week

Incorporating your own Company – Part 2

Directors of the Company: A company is entitled to have a minimum of two (2) directors.

Company Secretary: Every company must have a secretary. The directors of a company have the power to appoint and remove a company secretary.

Memorandum and Articles of Association: These are two statutory documents which represent a contract between a company and its members and the members of the company amongst themselves. The Memorandum sets out the following details of the company: name, type, registered address, amount of share capital and the agreement by members to be bound by the provisions of the Memorandum and take on the amount of shares written against their name in the subscription box provided in the Memorandum. The Articles of Association on the other hand prescribe the regulations for the company.

The necessary CAC Forms to be filled

Form CAC 1 (Availability Check and Reservation of Name): This form is used to check for the availability of your proposed name for the company which can be reserved for a period not exceeding Sixty (60) days. It is important to note that during the period of reservation no other company will be registered under the reserved name or under any other name which in the opinion of the CAC bears too close a resemblance to the reserved name.

Form CAC 2 (Statement of Share Capital and Return Allotment of Shares): This form is used at incorporation to state the amount of share capital of the company. Please note that this form is liable to stamp duties by the Federal Inland Revenue Service.

Form CAC 3 (Notice of Registered Office): This form shows the registered office address of a company which is usually the head office of the company.

Form CAC 4 (Declaration of Compliance with the Requirement of CAMA): This form is filed and signed by a Lawyer as a declaration that the promoter of the company has complied with the provisions of CAMA in incorporating the company. This form can only be signed by a lawyer who has been called to the Nigerian Bar and has his name on the roll at the Supreme Court of Nigeria.

Form CAC 2.1 (Particulars of Secretary of a Company or any change therein): This form is used to register the details of the company’s secretary appointed by the directors of the company.

Form CAC 7 (Particulars of Directors or any Change therein): This form is used to register the details of the directors and any changes made (including resignation of any director).

Major steps in incorporating your Company

  

1.          Engage a Lawyer to assist with the incorporation
2.          Fill the necessary portions of the forms listed above
3.       Draft your Memorandum and Articles of Association (your lawyer can assist with that)
4.          Stamp your Memorandum and Articles of Association as well as the Form CAC 2  at the Stamp Duties Office (your lawyer can assist with that)
5.          Submit all documents to the CAC
6.          Obtain your Certificate of Incorporation
7.          Start operations

After incorporating your business, it is important to note the following:

• all necessary permits and licenses relevant to your line of business should be obtained;
• advice on the tax liability of the company and the employees should be obtained;
• insurance policies for the company’s assets and employees to cater for any mishaps that may happen in the cause of the business operations of the company should be taken out; and
• the necessary filings at the CAC should be carried out by the company’s secretary.