chumanji01:
@MyIncorp

What are the likely scenarios which could have taken place and If he refuses,what step do I take? How do you know an accredited agent? I started the process at the website but I got hooked somewhere and decided to go to the branch for more explanation. CAC website is not definite as regards contacts to call nor do they have a customer care to let you know of accredited agents?Your last hope when you wish to solve a pressing matter is to locate the branch when the website isn't clear anymore.

chumanji01:
The boss has assured me to follow up the case meticulously till I have my Company documents.He said a refund would be made with slight adjustments and a refiling if reason is ascertained and there's need for a name change and conclusion of already initiated process if there no need.Says hell try to get to branch where search was done to know the exact reason. @MyIncop thanks. It was with your thread that I had to take up this matter.Wondered if solutions for some matters could ever be found in our country for some offices when we should have gone far beyond this. I appreciate your works,understanding,contribution and advise. Ill definitely hook up with you. Thankx

futurerex:
Hello sir, I would like to know what type of businesses that can be run under "entertainment". Is it possible to run media & publication under it? Duo it's a business name. Thanks

MyIncorp:


You can register a media and publication as a business name. But, you must possess a certificate in any media-related professional association. E.g NUJ, NIPR

To avoid being asked to provide a certificate avoid using the word "media".

ThundrCork:
Detailed and worth following. Thanks

uvalued:
thanks

MyIncorp:


As registration agents, we face this situation at times; especially when the client has delayed in making payments.

Nonetheless, since the name was initially approved, you will have to re-validate (re-submit) the approved name (and hope it will be approved a second time).

There, however, is no guarantee that the name will be approved again; as another approving officer might see reason the proposed name shouldn't be approved.

My submission is based on a recent experience. In this particular case, the proposed trustee name was approved. But due to delays on the part of the client, we couldn't complete the registration before the end of the grace period. And trust me, publications had been made.

After re-submitting the approved name for a possible approval, the name was denied. According to the CAC, the word "action" which was included in the name wasn't registrable.

We resubmitted the name a number of times, hoping we could be lucky in one of those attempts, but failed.

We had to write the oga patapata for CAC (Registrar General) to lay our complaints and requesting that the proposed name be approved as we had made publications in the dailies due to the initial approval.

Long story short, we were finally denied and reasons for denial was stated. They said the word "action" is political in nature or suggest military.

In situations such as this, you will have to find a new name and publish new notices on the pages of newspapers.

meemeee:
Thanks a million.

I really do appreciate your reply.

What you said is true, after re-submitting for re-validity, it was not accepted. so all the money for publishing in national dailies is a waste.

We have to start all over..

Thanks again.

MyIncorp:
Hi, NLders.
I have been away for a while. However, I am overwhelmed by the number of calls I get with respect to this post.

You can post your questions here, and I will be glad to provide you answers.

nosdat:
Your posts have been very informative. I just submitted a business name that was approved online (MAX EDU CONSULT) for registration. The lady who took my application said they may need a proficiency certificate and licence from me because of the inclusion of EDU and CONSULT in the proposed name. Please, is this true? And if it is, what do i do?

nosdat:
Your posts have been very informative. I just submitted a business name that was approved online (MAX EDU CONSULT) for registration. The lady who took my application said they may need a proficiency certificate and licence from me because of the inclusion of EDU and CONSULT in the proposed name. Please, is this true? And if it is, what do i do?

MyIncorp:
Having directly overseen the formation of more than 250 businesses over more than half a decade, I can say I have seen it all when it comes to dealing with issues of company formation in Nigeria.

In a series of post, I shall be put together questions and answers that will guide the prospective investor, business owner and stakeholders in the business world.

Enjoy.
 
Q1: What is a business name and why is it so important?
A business name is the name which a business trades under for commercial purposes. A business does not actually begin by formulating a business plan or opening a bank account. It starts from choosing a name. There is more to business name than just identity. A good business name is an advertising tool. Many large companies even hire expensive consultants to help them name their businesses, products and services.
 
Q2: I have this business name that I love so much, and I want to start a business under that name. Can I proceed immediately?
No. I think the next thing after you must have done a feasibility study on the business itself is to get the business name registered at the Corporate Affairs Commission (CAC).
 
Q3: What do you mean by Corporate Affairs Commission?
Registration of business in Nigeria is the exclusive responsibility of the Corporate Affairs Commission, also known as CAC; which has its head office in Abuja, and branches in most states of the federation. The CAC is the federal government agency responsible for registration of all companies.
 
Q4: But I was told that the cost of registering/incorporating a company is expensive. Can't I go on with the business then register the name later?
My candid advice is No! Having your business registered definitely confers some credibility on it, given that it then acquires an identity. In many important business activities or relationships you may want to get involved in, details of your business registration will be required. You do not have to wait for such occasions before getting your business into the register of companies - you may miss an important opportunity just for that omission.
 
Q5: Is that all?
No. Using a business name similar or identical to that of a registered business name can land you into problems, including legal issues. Besides, if you have succeeded in doing business for several years under a name which has not been registered, that does not confer ownership of such business name on you. The CAC has to approve the availability of such a business name before you can proceed to file an application to get the name registered.
 
Q6: Does that mean I may forfeit a business name that I have been trading under and has become so popular in the marketplace just because I didn't register it at first?
 Yes. Due to your negligence, someone somewhere might have registered that name or a similar one. This means you will lose all the goodwill that name garnered over the years. Do you see that this situation is more expensive?
 
Q7: I understand that the Corporate Affairs Commission rejects registration of some business names. What are the likely reasons for such actions?
Good question! Officials at the CAC use their discretion in approving a business name submitted for search. Business names may be disapproved if such names existed or are similar to the ones on their database. At times, business names are disapproved due to their vague nature. Consider someone who submitted LAW FIRM as a business name!? More so, objects such as INSTITUTION, FOUNDATION and MINISTRY are not likely to be approved as a business name, except when such objects are used for registration of incorporated companies/trustees.
 
Q8: What difference exists between a business name and incorporation of company or trustee?
To start a business, you need to decide on a business name. You also need to choose a business format under which to operate. You need to know the requirements relating to membership of the company, ownership, etc to enable you make decisions you will remain happy with. The routine processes of registration can then be carried out on your behalf by an accredited professional.
 
Q9: Do you mean business names, companies, and trustees are formats?
Yes. It may be called business structures too. You will need to talk to an expert concerning this. However, let me give you a little of what you should know.
 
Three major classes of registration are available under the relevant law (the Companies and Allied Matters Act of 1990):
 
Registration of Business Names: This applies to sole proprietorships and partnerships. It is the simplest form of business structure. It is the one-man business, owned by a single person and called ‘enterprise' in the local parlance. The partnership applies to a business where two or more persons agree to jointly own and carry on the business. Given the fairly complex nature of partnerships, it is best to seek the services of experts to assist with the details.
 
Q10: What about incorporation of companies and trustees?
Incorporation of companies is the second class of registration available under this Act. Incorporation recognizes the business as a unique entity, separate from the owners, with statutory powers to own property and sue or be sued. There is thus the concept of limited liability, implying that the individual owner's (shareholder's) liability relating to the business is limited to the amount of his share subscription.
 
The third class under this Act is the Registration of Incorporated Trustee. This applies to public institutions and associations, operated by a Board of Trustees. This category includes: NGOs, churches, clubs, trade associations, political and civil groups etc.
 
Q11: Can an ‘enterprise' (business name) be used to carry on all kinds of business?
 
A: No. The choice of which structure to adopt will depend on the nature of the business, the ownership and evaluation of the benefits, and the pitfalls of each format.
 
Q12: Why do some people prefer to incorporate a limited liability company?
 
A: Limited liability companies have grown to become so popular among business owners due to the following reasons:
 
(I) There is limited liability for individual shareholder. This means that the personal assets of the directors and shareholders are protected in the event of the company winding up as long as the company is operated legally.
 
(II) The standing of the business is enhanced before financial institutions and other parties it does business with. Limited status also provides a certain level of confidence in the business from both suppliers and customers.
 
(III) It has a better access to credit and on even better terms.
 
(IV) The business is distinct from individual owners; the death of a member does not dissolve the company.
 
Q13: Can I handle the registration procedures myself?
Yes. But the challenge here is that you may receive many queries from the officials at the CAC if you don't comply with certain rules. Though it is cheaper to do the registration yourself, hiring the services of accredited professionals does pay in the long run. However, the CAC specifically requires that only accredited parties carry out the actual registration processing for incorporation of companies. The accredited professional you choose for the registration process should also be able to provide further advice. As a trained practitioner, he is also familiar with the registration requirements for each business format and processing procedure. However, with the new Company Regulation (with effect from January 1, 2013), the first director/subscriber can carry on registration process.
 
Q14: Now, how long does it take to get my business registered and receive a certificate?
The duration depends on the business format you are considering. Applications for registration of business names are usually processed at the zonal office where you submitted an application to be registered. However, applications for incorporation of companies/trustees are usually forwarded to Abuja for processing. This may take more time.
 
In either case, the duration also depends on how soon the Name Availability result is released.  Name search may take 3-5 days; and the issuance of business name certificates may take 7-21 days depending on the business format.
 
Q15: How much does it cost to have my business name registered with the Corporate Affairs Commission?
The fees depend on the accredited agent and how he bonds with you with his professional fees.
 
Q16: Do you mean having my business name or company registered with the CAC confers special rights or privileges or licenses to carry on my line of business?
No. Registration of any business name under the Companies and Allied Matters Act only confers on the proprietor or partners thereof of the right to carry on such business under a business name, that is, a name other than their own surname or surnames without any addition other than their forenames or Names or the initial of such forename or names. It does not confer any special right or privileges or any license to carry on the business itself.
 
Q17: Do you mean certain businesses require licenses, educational certificates or accreditation from an authorized body before venturing into them?
Yes. Before you register a company that requires a lot of technical and financial input, the CAC has devised new means of screening out touts and quacks from proclaiming to be ‘professionals' in a field that requires extreme expertise. Hence, it is required that you provide educational certificates, belong to a relevant professional body, and or must have gained several years of hands-on experience.
 
Businesses that fall into this category may include: Advertising/Public Relations, Alternative Medical Practice, Architects/Town Planners, Chartered Secretaries, General Tax Consultants, Hospital/Clinics, Building/Civil Engineers/Contractors, Food Products/Processing, Legal Practice & Consultancy, Human Resource Management, Schools etc.
 
Q18: How many directors can form a Private Limited Liability Company?
 Unlike a business name (sole proprietorship) that can be formed by only 1 person, a private limited liability company can be incorporated by 2-50 persons called directors or shareholders.
 
Q19: What does an Authorized Share Capital mean and why is it common to register a 1 million share capital?
The issue of Authorized Share Capital raises the question of how strong the company is and the worth of the company in monetary terms. Shares mean the amount of rights you own in a company. The minimum share capital we register is 1 million because if you register any less, you still pay the same cost of registration. Besides, a 1 million share capital is only nominal, and you don’t need to have 1 million naira in the bank before you incorporate a 1 million share capital company. If you own 500,000 worth of shares in a 1 million share capital company, it means you own 50% of the company.
 
There are some companies that the CAC statutorily specifies for a higher minimum share capital when registering them – Banks, Insurance Companies, Travel Agencies, Broking firms, Security Agencies, Registrars, Bureau de’ Change, Forex Companies, etc.
 
 Authorized share capital is also referred to, at times, as registered capital. It is the total of the share capital which a limited company is allowed (authorized) to issue. It presents the upper boundary for the actually issued share capital.
 
Q20. What are the statutorily requirements for forming a private limited company in Nigeria?
A private limited liability company can be formed by 2-50 members (known as directors). They must not be people: of sound mind, declared bankrupt, less than 18 years of age, of fraudulent characters.
 
Q21: Why is the C.T.C so important?
The advantages of this is that with the CTC, you can present it to any company to inspect its objects for business, to help conduct businesses with banks, tender it for auctions, or government contracts, etc, when these big corporate institutions need them. If you don't have a CTC, you will force the company to do a search on your company at the CAC. Which means you will be billed for that search by the corporation. So, imagine how many times you will be shelling out money for company searches?
 
Q22: Do I get a CTC for a business name (Sole Proprietorship/Partnership)?
Yes. But it's quite different from that of incorporated companies/trustees.
 
Q23: I don’t have a permanent business address yet. I operate my business from home. Can I use my residential address as my business address?
Yes, you can. Then you can request for a change of address when you move to new location.
 
Q24: I quite understand why it is so important to register a business name or incorporate a company/trustee. It's in my best interest, isn't it?
Certainly! Imagine your organization being recognized, favoured and approved of by your target market/audience, government agencies, international organizations, financial institutions, or even your local community - just because you are duly registered with the Corporate Affairs Commission of the Federal Republic of Nigeria! The importance of your organization's certification with the nation's registrar of companies/trustee cannot be over-emphasized.
 
 Do you have a question that is not listed above? Please, drop a question here.

MyIncorp:
Q25. I want to “upgrade” my existing business name to a private limited liability company, and retain the name. What are the steps to be taken?
Ans. To incorporate a Company out of an existing business name, the following steps must be taken:
1. Ensure that the existing business name has complied with the statutory annual returns filing (to date). For those that do not know, Business Names are required to submit details of their annual accounts to the CAC;
2. Apply for Business Name Cessation (a Letter from the Registrar General, stating that the business name cease to operate, will be given to , will be issued to you);
3. Submit a Company Name search for your preferred names. Usually, the names will be a resemblance of your previous business name. For example, if your business name was “Adaobi Media”, you may want to present “Adaobi Media Limited” as your preferred company name.
4. Once your company name has been approved, then you can proceed to incorporate the company.

Q26. Does the Corporate Affairs Commission receive tax remittances for Company Income Taxes, Value Added Taxes, and other type of taxes?
Ans. No. You are only required to submit a copy of your company’s audited account to the CAC.
There are three tiers of tax collecting agencies in Nigeria – The Federal Inland Revenue Service (FIRS), various states board of Inland Revenue, and the Local Governments. The type of business structure you operate and your nature of business will determine what type of tax required of your business to pay. The basics, however, are Company Income Tax, VAT, Education Tax, Petroleum Tax, Technology Tax, Direct Assessment, and Personal Income Tax.
PIT and VAT are usually only paid by entrepreneurs who operate a business name. You will need to speak to your adviser about what type of tax is peculiar to your business structure.

Q27. I have just started the incorporation process and one of my preferred company names have been approved, but I want to slightly change the approved company name. How do I go about this?
Ans. If the initially approved named was “Mango Park Resort Limited”, but you want “Mango Park & Resort Limited”, you can take the approval notice to the CAC requesting that they delete the initially approved company name from their database and re-enter your new choice. You have a better chance of having “Mango Park & Resort Limited” approved for you. Otherwise, you can wait till the expiration of the 60 days validity to resubmit your new preference. But there isn’t a guarantee that your new name will be approved.

Q28. I want to register “Grage Schools”, but I was told the CAC is requesting my educational certificates to be able to register a school. How true is this?
Ans. Yes, to be able to register or incorporate certain nature of businesses, the CAC will request you provide a certificate of proficiency in the area(s) of business(es). For be able to operate a nursery and primary school, the owners must possess at least a NCE or any equivalent certificate. But for a Secondary School, the owner must possess at least a B.Ed.

Q29. I would like to know if I can add “company” as a suffix to a Business Name.
Ans. Yes, you can add the suffix “Company” to a business name. In addition, the following suffixes are suitable also: Ventures, Enterprise, Concept, Digital, International, Media, Zone, and many more.

Q30. Please, what is the difference between an Enterprise and a Venture?
Ans. The only difference is nomenclature. In the Nigerian context, they mean the same. Both are referred to as Business Name.