DOES A CAC CERTIFICATE EXPIRE? HERE’S WHAT YOU NEED TO KNOW.

 

As a business owner or entrepreneur in Nigeria, you are likely familiar with the Corporate Affairs Commission (CAC) and the importance of obtaining a CAC certificate for your business. The CAC certificate is a legal document that indicates the registration status of your business and is required for a variety of business transactions, including opening a bank account, registering for taxes, and bidding on government contracts. However, one question that many business owners have is whether a CAC certificate expires.

The short answer is NO, a CAC certificate does not expire. Once your business is registered with the CAC and you obtain a certificate of incorporation, that certificate is valid indefinitely. However, it is important to note that while the certificate itself does not expire, there are some situations in which your business may need to update or renew its registration with the CAC.

For example, if your business changes its name or address, you will need to update your registration with the CAC to reflect those changes. Similarly, if you want to add or remove directors or shareholders from your business, you will need to update your registration with the CAC. Failure to update your registration in a timely manner can result in penalties or fines, so it is important to stay up-to-date with any changes to your business.

Additionally, while the CAC certificate itself does not expire, there are some circumstances in which your business may be struck off the register of companies. This can happen if your business fails to file annual returns with the CAC or if it is found to be in breach of other statutory requirements. If your business is struck off the register, you will need to take steps to restore it, which may involve paying fines and submitting additional paperwork to the CAC.

In summary, while a CAC certificate itself does not expire, it is important to stay up-to-date with any changes to your business and to ensure that you meet all statutory requirements for maintaining your registration with the CAC. By doing so, you can ensure that your business remains in good standing and that you can continue to take advantage of the many benefits that come with having a registered business in Nigeria.

Regville Associates offers end-to-end legal, secretarial, tax and compliance service for companies. Our services aid companies in achieving and sustaining compliance with regulations.

Feel free to contact us.

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

ENSURING COMPLIANCE: A STEP-BY-STEP GUIDE ON HOW TO CHECK IF YOUR COMPANY IS ACTIVE OR INACTIVE ON CAC NIGERIA AND WHAT TO DO NEXT

Corporate Affairs Commission

The Corporate Affairs Commission (CAC) is the regulatory body responsible for the registration and regulation of companies in Nigeria. It is essential to know if your company is active or inactive on CAC Nigeria as it determines the legal status of your business. In this article, we will guide you on how to check if your company is active or inactive on CAC Nigeria and what to do next.

STEP 1: Visit the CAC Nigeria Website

The first step to check the status of your company is to visit the CAC Nigeria website, www.cac.gov.ng. The website is user-friendly and easy to navigate. On the homepage, you will see a tab that says “Public Search”. Click on it to proceed.

STEP 2: Enter Company Name

Once you have clicked on “Public Search”, you will be redirected to a new page. On this page, you will see a search bar where you can enter the name of your company. It is important to note that you must enter the exact name of your company as it is registered with CAC Nigeria.

STEP 3: Review Search Results

After entering your company name, click on the “Search” button. The website will display a list of companies that match the name you entered. Review the search results to locate your company.

STEP 4: Check Company Status

When you have located your company, check the status column to see if it is active or inactive. If your company is active, it means that it is currently in good standing with CAC Nigeria, and all necessary filings and fees have been paid. On the other hand, if your company is inactive, it means that it is no longer in good standing with CAC Nigeria. This may be due to the non-payment of annual fees or non-compliance with regulatory requirements.

What to Do Next If your company is active, congratulations! You are compliant with all CAC Nigeria regulations, and your business is in good standing. However, if your company is inactive, there are a few steps you should take to remedy the situation.

STEP 1: Determine the Reason for Inactivity

The first step is to determine the reason for your company’s inactivity. This may be due to non-payment of annual fees, non-filing of annual returns, or non-compliance with regulatory requirements.

STEP 2: Address the Issue

Once you have determined the reason for your company’s inactivity, take steps to address the issue. For example, if your company is inactive due to non-payment of annual fees, make the necessary payments to bring your account up to date. If your company is inactive due to non-filing of annual returns, submit the necessary documentation to CAC Nigeria.

STEP 3: Seek Professional Assistance

If you are unsure about how to address the issue, seek professional assistance from a lawyer or accountant. They can guide you through the process and ensure that you are in compliance with all CAC Nigeria regulations.

Conclusion

In conclusion, it is essential to check if your company is active or inactive on CAC Nigeria to ensure that your business is in good standing with the regulatory body. By following the steps outlined in this article, you can easily check your company’s status and take the necessary steps to address any issues. Remember, compliance with CAC Nigeria regulations is essential for the success and longevity of your business.

Regville Associates offers end-to-end legal, tax and compliance service for companies. We assist Companies in becoming and staying regulatory compliant.

Feel free to contact us.

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

IS YOUR NIGERIAN COMPANY READY FOR A HOLDING COMPANY STRUCTURE? TIPS TO CONSIDER FOR EXPANSION, RISK MANAGEMENT, AND TAX PLANNING

Image Source – indeed.com

A holding company is a type of business structure that owns other companies’ outstanding stock. It is a popular structure for many Nigerian businesses looking to expand their operations and consolidate their holdings. However, determining whether your company is ripe for a holding company structure can be a daunting task. In this article, we will explore some tips to help you determine whether your company is ripe for a holding company in Nigeria, backed by statistics, examples, and laws.

1. DIVERSIFICATION OF BUSINESS OPERATIONS: If your company has multiple business operations, it may be time to consider a holding company structure. A holding company can hold multiple subsidiaries, each with their unique operations, while the holding company oversees the management and governance of these subsidiaries. According to the Nigerian Bureau of Statistics, the top five sectors that contributed to the country’s Gross Domestic Product (GDP) in the second quarter of 2021 were Agriculture, Trade, Information and Communication, Manufacturing, and Oil and Gas. Companies that operate in multiple sectors and want to streamline their management can benefit from a holding company structure.

2. EXPANSION PLANS: If your company is planning to expand its operations to other locations or countries, a holding company structure can be beneficial. A holding company can hold subsidiaries that operate in different locations, making it easier to manage operations in various countries or regions. According to the National Bureau of Statistics, in 2020, Nigeria’s export trade was dominated by crude oil, accounting for 73.27% of total exports. Companies looking to expand into the export market can benefit from a holding company structure.

3. LIMITED LIABILITY PROTECTION: A holding company structure can provide limited liability protection for its subsidiaries. This means that the holding company’s assets are separate from the subsidiary’s assets, protecting the holding company’s assets from any liabilities or debts incurred by its subsidiaries. This protection can be crucial for companies operating in high-risk sectors, such as the oil and gas industry or construction sector. The Companies and Allied Matters Act (CAMA) 2020 governs holding companies in Nigeria, and it provides provisions for limited liability protection for holding companies and their subsidiaries.

4. TAX PLANNING: A holding company structure can also provide tax planning benefits. Holding companies can take advantage of tax incentives, such as tax holidays, and can also reduce their tax liability by consolidating tax returns for their subsidiaries. This tax planning can be crucial for companies that operate in sectors with high tax rates, such as the telecommunications industry.

5. SIMPLIFIED CORPORATE GOVERNANCE: Holding companies can simplify corporate governance by consolidating the management and decision-making processes for their subsidiaries. This consolidation can reduce bureaucratic processes and improve decision-making efficiency. For example, Dangote Industries Limited, a Nigerian multinational conglomerate, has a holding company structure that oversees the operations of its subsidiaries, including Dangote Cement, Dangote Sugar Refinery, and Dangote Flour Mills.

In conclusion, determining whether your company is ripe for a holding company structure in Nigeria requires a thorough evaluation of your company’s operations, expansion plans, risk management, and tax planning. By considering these tips, your company can take advantage of the benefits of a holding company structure, such as diversification of operations, limited liability protection, tax planning, and simplified corporate governance. With the recent passage of the CAMA 2020, Nigerian businesses can now enjoy more flexibility and options in structuring their businesses.

Regville Associates offers end-to-end legal, tax and compliance service for companies. We assist Companies in becoming and staying regulatory compliant.

Feel free to contact us.

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

UNDERSTANDING THE DRAWBACKS OF USING A BUSINESS NAME INSTEAD OF A LIMITED LIABILITY COMPANY (LLC)

One major drawback of using a business name over a Limited Liability Company (LLC) is that a business name does not provide limited liability protection for its owners. This means that if the business incurs any debts or legal liabilities, the owners’ personal assets may be at risk.

In contrast, an LLC is a separate legal entity from its owners and provides limited liability protection. This means that the owners’ personal assets are generally shielded from the debts and legal liabilities of the business.

Additionally, having a business name alone does not provide the same level of credibility and professionalism that an LLC can provide. An LLC is a formal business structure that is recognized by the law and offers certain legal and tax benefits. It can also help establish credibility with potential customers, suppliers, and investors.

Another potential disadvantage of using a business name is that it may be more difficult to obtain financing or attract investors compared to an LLC. Investors and lenders may view an LLC as a more stable and secure investment opportunity because of the legal protections it offers.

Overall, while a business name may be a simpler and more flexible option for some entrepreneurs, it lacks the legal and financial protections and advantages that an LLC can provide.

Regville Associates offers end-to-end legal, tax and compliance service for companies. We assist Companies in becoming and staying regulatory compliant.

Feel free to contact us.

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

WHY NIGERIAN COMPANIES MUST PRIORITIZE PAYMENT OF ANNUAL RETURNS TO THE CORPORATE AFFAIRS COMMISSION

Annual Returns

The Corporate Affairs Commission (CAC) is the regulatory body responsible for the formation and management of companies in Nigeria. One of the statutory obligations of registered companies with the CAC is the payment of annual returns. This is an important requirement for the compliance and sustainability of businesses in Nigeria.

Annual returns refer to the filing of financial statements and other relevant information of a company with the CAC on an annual basis. It is a mandatory requirement for all registered companies, and failure to comply can lead to penalties or the revocation of the company’s registration. The annual returns must be filed with the CAC within 42 days of the company’s Annual General Meeting (AGM).

The payment of annual returns is crucial for several reasons, some of which include:

1. COMPLIANCE WITH REGULATORY REQUIREMENTS: Payment of annual returns is a regulatory requirement that all registered companies in Nigeria must comply with. Non-compliance can lead to penalties, revocation of the company’s registration, and other legal consequences.

2. PUBLIC RECORD OF COMPANY INFORMATION: Filing annual returns with the CAC ensures that the public has access to the company’s up-to-date information, including its directors, shareholders, financial statements, and other relevant information. This promotes transparency and accountability and helps to build public trust in the company.

3. MAINTENANCE OF THE COMPANY’S LEGAL STATUS: Payment of annual returns is essential to maintain the legal status of the company. A company that fails to file its annual returns for a consecutive period of time may be struck off the register of companies. This can have serious consequences for the company, including the inability to engage in legal transactions, inability to access loans, and other financial support.

4. ACCESS TO FINANCIAL SUPPORT: Companies that comply with regulatory requirements such as payment of annual returns are more likely to have access to financial support, including loans and other forms of financial assistance. This is because compliance with regulatory requirements is an indication of good corporate governance and financial management.

5. TRAVELLING REQUIREMENTS: It is also important to note that Embassies now require companies to present their active company documents as evidence of their legal standing. An “inactive” status could result in Embassies not considering a company as an eligible business for visa applications.

In conclusion, the payment of annual returns to the Corporate Affairs Commission is a legal requirement that is essential for the compliance and sustainability of businesses in Nigeria. It promotes transparency, accountability, and good corporate governance, and helps to maintain the legal status of the company. Companies should ensure that they file their annual returns on time to avoid penalties and other legal consequences. It is also important to note that an “inactive” status could result in Embassies not considering a company as an eligible business for visa applications, tenders, or other services.

Therefore, Nigerian companies should prioritize payment of annual returns as part of their corporate compliance obligations. This will help to ensure the continued growth and success of their businesses.

Regville Associates offers end-to-end legal, tax and compliance service for companies. We assist Companies in becoming and staying regulatory compliant.

Feel free to contact us.

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

FIVE (5) CATEGORIES OF PERSONS THAT CAN’T ACT AS A DIRECTOR IN NIGERIA

In Nigeria, there are certain individuals who are prohibited from serving as a director of a company. The Companies and Allied Matters Act (CAMA) outlines these disqualifications and restrictions.

1. INSOLVENT INDIVIDUALS: An individual who is declared bankrupt or is under a debt management plan is disqualified from being a director.

2. CONVICTED FELONS: Convicted felons: Individuals who have been convicted of an offense involving dishonesty or fraud are not eligible to serve as a director.

3. MINORS: Individuals who are below the age of 18 years are not eligible to serve as a director.

4. UNFIT INDIVIDUALS: Individuals who have been found to be of unsound mind or who are under a legal disability are prohibited from being a director.

5. DISQUALIFIED DIRECTORS: Individuals who have been disqualified from serving as a director by a court order or regulatory authority are not eligible to serve in this capacity.

It is important to note that the disqualifications outlined above apply to both executive and non-executive directors. Additionally, if a director is found to have acted in contravention of these restrictions, they may be held liable for their actions and face sanctions, including fines and imprisonment.

In conclusion, being a director of a company in Nigeria comes with its own set of responsibilities and obligations. It is important for individuals to ensure that they are eligible and qualified to serve in this capacity before accepting a directorship appointment.

For Company Formation and Restructuring, feel free to contact us

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

GROUNDS FOR THE REMOVAL OF DIRECTOR(S) IN NIGERIA

The Corporate Affairs Commission (CAC) is the regulatory agency responsible for registering and regulating companies in Nigeria. The removal of directors in Nigeria is governed by the Companies and Allied Matters Act (CAMA) which provides the legal framework for the appointment and removal of directors in Nigerian companies.

According to CAMA, directors can be removed by:

1. RESIGNATION: A director may resign from their position at any time by giving notice in writing to the company.

2. RETIREMENT: Directors are required to retire at the annual general meeting of the company and may be re-elected if they wish to continue serving on the board.

3. TERMINATION BY THE COMPANY: The company may remove a director by passing a resolution to that effect at a general meeting of the shareholders.

4. TERMINATION BY THE CAC: The CAC may remove a director if they are found to have acted in a manner that is prejudicial to the interests of the company or if they have been declared bankrupt.

It is important to note that the removal of directors must be done in accordance with the provisions of CAMA and any relevant regulations. The CAC may investigate and enforce compliance with these provisions to ensure the proper removal of directors.

For corporate restructuring process and filing, feel free to contact us

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

LEGAL & TAX: FIVE (5) COMMON MISTAKES MADE BY STARTUPS

getty images

Starting a new business is an exciting and challenging endeavor, but it can also be risky. Legal and tax mistakes are common among startups and can lead to significant financial losses and legal trouble. In this article, we will discuss five common legal and tax mistakes made by startups and how to avoid them.

1. NOT INCORPORATING: One common mistake made by startups is failing to incorporate their business, which can lead to personal liability for the company’s debts and legal issues.

2. NOT PROTECTING INTELLECTUAL PROPERTY: Startups often overlook the importance of protecting their intellectual property, such as trademarks and patents, which can lead to legal disputes and financial losses.

3. NOT KEEPING ACCURATE FINANCIAL RECORDS: Many startups fail to keep accurate financial records, which can lead to legal issues and difficulty in obtaining funding.

4. NO UNDERSTANDING TAX LAWS AND DUE DATES: Startups often make the mistake of not understanding the tax laws and regulations that apply to their business, which can lead to penalties and fines.

5. NOT HAVING A CLEAR EQUITY SPLIT AMONG FOUNDERS: Startups often make the mistake of not having a clear equity split among the founders, which can lead to disagreements and legal issues. It is important to have a clear agreement in place from the beginning.

To avoid or remedy these pitfalls, contact us today

Tolulope Oguntade 
Regville Associates 
info@regville.com 
08065111667

FIVE (5) BENEFITS OF REGISTERING YOUR COMPANY WITH THE CORPORATE AFFAIRS COMMISSION (CAC)

Corporate Affiars Commission (CAC)

The Corporate Affairs Commission (CAC) of Nigeria is a government agency responsible for the registration and regulation of companies and businesses in Nigeria. It is tasked with the responsibility of regulating the formation, registration, incorporation and management of companies and businesses in Nigeria. Its aim is to ensure compliance with the laws and regulations that govern the formation, registration and operation of companies and businesses in the country. The commission also maintains a database of registered companies and businesses and makes this information available to the public. The CAC also has the power to deregister companies that do not comply with the laws and regulations or that have become dormant.

There are several benefits of registering a company with the Corporate Affairs Commission (CAC) in Nigeria, including:

1. LEGAL RECOGNITION: A registered company is legally recognized as a separate entity from its owners and has the ability to enter into contracts, borrow money, and sue or be sued in its own name.

2. LIMITED LIABILITY: Shareholders of a registered company are typically only liable for the debts of the company to the extent of their unpaid share capital.

3. CREDIBILITY: Registering a company with the CAC can enhance the company’s credibility and reputation, as it demonstrates a commitment to compliance with legal and regulatory requirements.

4. ACCESS TO FUNDING: Registering a company with the CAC may be a requirement for accessing certain forms of funding, such as bank loans or venture capital.

5. EASE OF DOING BUSINESS: Registering a company with the CAC can make it easier to do business, as it can streamline the process of opening bank accounts, applying for permits and licenses, and other administrative tasks.

In conclusion, registering a company with the Corporate Affairs Commission (CAC) in Nigeria offers several benefits that can help a business to operate legally and efficiently. These benefits include legal recognition, limited liability, increased credibility, access to funding, and ease of doing business. By registering with the CAC, a company is demonstrating its commitment to compliance with legal and regulatory requirements, which can enhance its reputation and make it easier to do business. Overall, registering with the CAC is an important step for any business looking to establish itself and grow in Nigeria.

For assistance on Company Formation and Compliance, feel free to contact us

Tolulope Oguntade 
Regville Associates
info@regville.com
08065111667

Starting a Pharmaceutical Company in Nigeria

Pharmaceutical Company

According to the law in Nigeria, the Companies and Allied Matters Act 2020 and the pharmacy Council of Nigeria have paved the way for incorporating a pharmaceutical company. As a result, this encourages everyone with their field of specialization to own a pharmaceutical company and also invest in it.

Note that one of the fastest-growing and most lucrative industries in Nigeria is the pharmaceutical industry. The registration of pharmaceutical companies in Nigeria is carried out and supervised by The Pharmacy Council of Nigeria (PCN) a statutory organ of the Federal Government of Nigeria, set up pursuant to decree 91 of 1992

What is a pharmaceutical Company?

A pharmaceutical company produces the likes of markets and acts as a medical drug distributor to patients to cure, vaccinate, or even alleviate their symptoms. So if you plan to establish a pharmaceutical company in Nigeria, this article is for you.

Based on how this article is detailed, you will learn how to set up a pharmaceutical company, the kinds of persons that are eligible to set up pharmaceutical companies, the registration requirements, and also the stated procedures to be followed to obtain the license to set up and run the business. 

However, the Pharmacy Council of Nigeria (PCN) serves as a self-regulatory organization that plays a crucial role in regulating, licensing, operations, and monitoring pharmaceutical businesses in Nigeria.

Procedure to Register a Pharmaceutical company in Nigeria

The first thing about registering a pharmaceutical company is that it can either be registered as a private limited company or a public limited company. However, the preferred choice made by most medical experts is to register as a private limited company.

Additionally, the categories of pharmaceutical companies that can be registered in Nigeria are three. They include; pharmaceutical retail, wholesale, and manufacturing.

Requirements for Registration

Pharmaceutical Retail Company

What a retail pharmaceutical company does is sell drugs to people. They are usually known as a pharmacy, chemists, or drugstores. For a retail, pharmaceutical company to function, it must be fully owned by a registered pharmacist or must be in partnership with other registered pharmacists.

A wholesale pharmaceutical company

The job of this kind of company is to import and distribute drugs, poisons, and devices. For this kind of company to operate, it requires at least one registered pharmacist on the Board of Directors of the Company. However, the transactions of the business must be executed under the direct personal control and management of a Superintendent Pharmacist.

A pharmaceutical manufacturing company

The pharmaceutical manufacturing industry works on the manufacturing of drugs. To register this kind of business, there must also be at least one registered pharmacist on the Board of Directors of the company. Additionally, the business operation must be done under a Superintendent pharmacist’s direct personal control and management.

Step 1: Company Registration

As mentioned before, most medical personnel prefer to register as a private limited company. Therefore, it is advisable also to do so. The reason why a private limited company is the most preferred choice for a business start-up is that there is ease of registration when it comes to costs and requirements. As for share capital, there is no specific threshold amount. Nevertheless, the company can also be registered with one million share capital.

2. Application for Inspection of Premises

Registering your pharmaceutical company will be one of many things you should do. You also have to take some necessary steps to obtain the business license, which comes after the scrutinization and approval of the business premises to be used.

In Essence, the pharmaceutical inspectors from the PCN would inspect your business premises for the purpose of ensuring that your business operation is in compliance with the provision of the regulation. This will be done before your pharmaceutical business will finally commence.

When it comes to the law, there are some ethics to follow, and the law on the inspection of the premises of pharmaceutical companies must be followed. The following guideline will be stated below.

  • The pharmaceutical premises must be located in specific locations like; motor parks and environments where commercial activities and enterprises are rapidly growing.
  • It must be outside a marketplace where the likes of kiosks and roadside retail are present.
  • All pharmaceutical premises should be at most three within a shopping mall, and there must be enough space between both businesses.
  • Pharmaceutical businesses should be at most two hundred meters away from each other.
  • The pharmaceutical business should be moved to another location if it is surrounded by a growing market close to it.

Required Details to Register a Pharmaceutical Retail, Wholesale, or Distribution Company

Note that all applications for the registration of new pharmaceutical retail or any other related business should be submitted to the Registrar of the Council through the Director of Pharmaceutical Services of the state of operation. Below are the following documents to be submitted as application documents.

  • An application letter (the company’s letter headed paper) to the recipient
  • A Duly completed form which includes (PCN’s Application Form for the Registration of Premises)
  • A photocopy of the Annual License must be provided
  • A bank draft that contains the prescribed inspection and registration fees, which is payable to the council
  • Copy of a letter of resignation from previous employment (if necessary)
  • Letter of acceptance of resignation (if necessary)
  • Letter of Appointment in the new premises (where applicable)
  • There must be a legal agreement between the Superintendent Pharmacist and his employer.
  • Must provide the company’s certificate of Incorporation (this involves evidence of registration of the business name, which is acceptable as regards Pharmacist-owned retail premises)
  • Must provide a certified copy of the company’s Articles and Memorandum of Association
  • Certified copy of Particulars of the company’s Directors as issued by the Corporate Affairs Commission.
  • A copy of the NYSC Discharge or Exemption Certificate (if necessary)
  • Must provide a letter of undertaking signed by the Managing Director of the company that all pharmaceutical businesses would be under the direct, personal, control and management of the Superintendent of the Pharmacist
  • A pharmacist Inter-state Movement form (if necessary)
  • Evidence of a pharmacist on the Board of Directors and the current Annual License of the pharmaceutical Director

Additional requirements for the registration of pharmaceutical manufacturing premises

The likes of the pharmaceutical retail, wholesale, distribution, and importation have the same process as a pharmaceutical manufacturing company. It is, therefore important to note that as far as a pharmaceutical company is concerned, there are certain procedures to follow during the course of registration. Below are the requirements every pharmaceutical manufacturing company is expected to make available to the council.

  • Accurate product lists to be manufactured.;
  • An Organogram;
  • List of staff qualifications and duties;
  • Factory layout;
  • Production flow-chart;
  • Equipment list in the production and quality control departments;
  • Water source and water treatment facilities;
  • Accurate list of sources of suppliers of raw materials;
  • Standard Operating procedures.
  • Standard cleaning procedures (this involves the procedures and payment of the inspection fee as regards to bank draft of N130,000, which is payable to the Pharmacists Council of Nigeria.

Conclusion

Pharmaceutical businesses are so important since they provide more than potential cures and lifesaving treatments. In addition to this, they also make way for fulfilling jobs in the pharmaceutical industry, thereby fuelling the global economy.

For Pharmaceutical Company Setup, Feel Free to contact us

Tolulope Oguntade 
Regville Associates
compliance@regville.com
08065111667