Treash:
It is no longer new that the body which regulates companies transaction (PART A), business names (PART B) and Incorporated Trustees like churches and charity organizations (PART C) is called Corporate Affairs Commission. Registration of these 3 medium encourages public confidence and safety.

It must be noted however, that registration of business names does not grant you some corporate benefits. For example, you can sue a registered company in it's own name but you cannot sue a business name. Once you register your business under part B and any wrong takes places, you will personally be liable, and not your business. A good example is Dangote Group which is registered under PART A. The implication is that you can't sue Dangote personally, but you can sue his company. He may decide to send his representative to represent the companies in court because the company will be responsible and not him, but in business name, you have to be responsible yourself.

The legal implication of this is if the company for instance owes a bank N10 million, it is the company that owes the bank and not the Directors, and the bank cannot then sue the Directors in their personal capacities in order to recover the debt (unless the Director(s) gave personal guarantees for the loan).

Another benefit is perpetual succession. It means, even if all members of the company die, the company will still be existing, and loan can be obtained in the name of the company even though the director has died. But in business names, the business crash the day the partners died.

Another one is in case of future exit. If you have a registered business, upon retirement, it is very likely that the business will retire with you. However, registering a business as a limited company can aid the possibility of selling it in the future. The original shareholder/owner of the company will be able to achieve a completely clean break and get a pay out for the business.

Barr Ayo Adeolu Aderinto, 08068088866.