If you are thinking of expanding your business into Nigeria, one of the most important things you need to understand is the minimum share capital for foreign companies in Nigeria.

Whether you’re an investor, a startup founder, or a consultant advising clients on foreign company incorporation in Nigeria, getting a firm grip on this requirement is key to a smooth market entry.

In this guide, we’ll break down the legal framework, especially the Companies and Allied Matters Act (CAMA). We’ll walk you through the share capital requirements and share practical steps and real-world examples to help you stay compliant and confident as you step into Nigeria’s business scene.

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TL;DR

• Foreign companies must have ₦100 million minimum share capital to register in Nigeria.
• This is mandated by CAMA 2020 and enforced by the Corporate Affairs Commission (CAC).
• It ensures financial commitment and affects incorporation costs.
• Key steps: Plan capital, engage experts, register with CAC, import funds, and get CCI.
• Real examples: MTN and Shoprite complied and thrived in Nigeria.

First things first, what is ‘minimum share capital’?

In plain terms, minimum share capital is the least amount of capital your company should be registered with.

Think of it like a legal safety net that limits how much liability your company has. It’s not money you necessarily need to have sitting in your bank account. It just means your company is worth that amount on paper.

But (and this is a big but), when foreign participation is involved, things get a bit twisty.

All in all, share capital is the amount of money a company raises by issuing shares to its shareholders. In Nigeria, this declared amount influences your ability to register as a foreign business entity.

Why minimum share capital matters in Nigeria  

Foreign investors and entrepreneurs eyeing Nigeria often focus on market potential, customer base, and industry trends. But before all the exciting business ideas can take off, they must navigate Nigerian business registration laws.

Gain insider insights to navigate Nigerian business laws with confidence.

At the heart of these laws is minimum share capital, which is the amount of capital a foreign-owned company must declare to legally register in Nigeria.

This requirement isn’t just bureaucratic red tape; it is a legal threshold that demonstrates the company’s financial readiness and commitment to doing business in the country.

The great ₦100 million saga   

Back in December 2023, the Corporate Affairs Commission (CAC) announced that any company with foreign participation must have a minimum share capital of ₦100,000,000 (that’s one hundred million naira).

This announcement caused quite a stir.

Then, just three days later, they pulled the announcement off their website.

While the CAC technically hasn’t updated its official rules, companies with foreign ownership are expected to meet that ₦100 million requirement.

So, if you’re thinking of going the ₦10 million route (the old standard), CAC might still query your documents and request an increase.  

Feeling overwhelmed by Nigeria’s changing capital rules? Here’s a personalised breakdown of what’s really required, and how other foreign businesses made it work.

So, why the confusion?   

Here’s where it gets unclear. The CAC, which handles company registration in Nigeria, seems to be saying one thing.

The Ministry of Interior, which oversees business permits and expatriate quotas, is saying something else.

According to their 2022 Handbook, you need ₦100 million in paid-up capital (not just issued) to even get a Business Permit, which is a must-have for any company with foreign participation.

So while CAC hasn’t officially enforced the new requirement, the Ministry of Interior is already using it as a standard.

And guess what? You need both agencies to be on your side to operate in Nigeria.

Some industries require even more  

Let’s say you’re not just launching any company, but getting into industries like banking, aviation, or fintech.

The minimum share capital requirements jump even higher. Here’s a comprehensive list to help you figure out where you stand:

Comprehensive list of minimum share capital by business type in Nigeria  

Type of company	Minimum share capital (₦)
Issuing House	200 Million
Broker/Dealer	300 Million
Trustee	300 Million
Fund/Portfolio Manager	150 Million
Stock Broker	200 Million
Stock Dealer	100 Million
Corporate Investment Adviser (Registrar)	150 Million
Corporate Investment Adviser	5 Million
Individual Investment Adviser	2 Million
Market Maker	2 Billion
Consultant (Partnership)	2 Million
Consultant (Individual)	500,000
Consultant (Corporate)	5 Million
Underwriter	200 Million
Venture Capital Manager	20 Million
Commodities Broker	40 Million
Capital Trade Point	20 Million
Rating Agency	150 Million
Corporate/Sub Broker	5 Million
Asset Management (Intangible Assets)	300 Million
Commercial Bank (Regional)	10 Billion
Commercial Bank (National)	25 Billion
Commercial Bank (International)	50 Billion
Merchant Bank	15 Billion
Payment Solution Services (PSS)	250 Million
Super Agent	50 Million
Payment Terminal Service Provider (PTSP)	100 Million
Payment Solutions Service Provider (PSSP)	100 Million
Mobile Money Operation	2 Billion
Switching and Processing	2 Billion
Unit Microfinance Bank (Tier 1)	200 Million
Unit Microfinance Bank (Tier 2)	50 Million
Microfinance Bank (State & FCT)	1 Billion
Microfinance Bank (National)	5 Billion
Primary Mortgage Institution	2 Billion
Finance Company	20 Million
Bureau de Change	35 Million
Non-Interest Bank (Regional)	5 Billion
Non-Interest Bank (National)	10 Billion
Insurance Broker	5 Million
Life Insurance	8 Billion
General Insurance	10 Billion
Composite Insurance	18 Billion
Re-Insurance	20 Billion
Unit Microinsurer	40 Million
State Microinsurer	100 Million
National Microinsurer	600 Million
Takaful Insurance (General/Family)	200 Million
Private Security Company/Consultant	10 Million
Pension Fund/Asset Custodian	2 Billion
Closed Pension Fund	500 Million
Pension Fund Administrator	5 Billion
Lottery	5 Million
Sports Lottery	30 Million
Air Transport (International)	2 Billion
Air Transport (Regional)	1 Billion
Air Transport (Local)	500 Million
Air Ambulance/Fumigation/Private Jet	20 Million
Aviation (Ground Handling Services)	500 Million
Aviation (Training Institutions)	2 Million
Agents of Foreign Airlines	1 Million
Travel/Tours	30 Million
Agricultural Seeds, Production, Processing, Marketing	10 Million
Shipping Company/Agent	25 Million
Cabotage Trade	25 Million
Life Micro-Insurance	150 Million
General Micro-Insurance	200 Million
Freight Forwarding	5 Million
Payment Service Bank	5 Billion
HMO (National)	400 Million (Paid up)
HMO (Regional)	200 Million (Paid up)
HMO (State)	100 Million (Paid up)

What’s the safe route?   

If you’re a foreign investor or a joint venture, the smartest move right now is to play it safe and go with ₦100 million as your minimum paid-up share capital.

Even if CAC hasn’t fully updated its checklist, that is what the Ministry of Interior wants to see, especially if you need:

• A business permit.
• Expatriate quotas.
• Any post-incorporation filings.

Trust us; it’ll save you time, energy, and a lot of back-and-forth emails.

CAMA and share capital rules   

The Companies and Allied Matters Act (CAMA) is Nigeria’s primary legislation governing corporate affairs. It was recently updated in 2020 to modernise business operations and attract more foreign investment.

The Corporate Affairs Commission (CAC) enforces the share capital requirements.

As a matter of fact, as of July 2024, the CAC has been strictly implementing the ₦100 million minimum share capital for companies with foreign participation.

This applies to any company with foreign shareholders or directors, regardless of the ownership percentage.

Non-compliance can lead to registration delays or sanctions, especially during post-incorporation filings.

It’s essential to note that while the authorized share capital has been replaced by the minimum issued share capital concept in CAMA 2020, the financial implications remain significant.

CAMA requirements in Nigeria  

Under CAMA, the minimum share capital for foreign companies in Nigeria is set at ₦100 million (approx. $120,000). This is substantially higher than what’s required for local companies, which typically need between ₦1 million and ₦10 million, depending on the business structure.

Exceptions and special cases  

While ₦100 million is the general benchmark, specific sectors such as oil & gas, financial services, and telecommunications may have additional capital requirements imposed by sector regulators (like the CBN, NCC, or DPR). Always consult industry-specific guidelines or a legal advisor.

Issued vs paid-up share capital (a quick 101)   

• Issued share capital: This is the number of shares the company has officially handed out to shareholders.
• Paid-up share capital: This refers to the shares that have actually been paid for by the shareholders.

The CAC leans more toward issued share capital. However, the Ministry of Interior wants to see those shares fully paid up. That’s where the friction lies.

Also, under Ministry of Interior guidelines, the value of any equipment or machinery brought into Nigeria for business can count toward their paid-up capital.

Practical implications for foreign investors  

So, how does this ₦100 million requirement affect real-world operations?

Strategic financial planning  

This high threshold means foreign companies need to plan and allocate funds effectively from the outset.

It’s not just about declaring a number, capital needs to reflect actual business intentions.

Potential challenges with the 100 million share capital

• Startups or SMEs may find the bar quite high unless they have strong backers.
• Inadequate capital documentation can slow down the CAC registration process.
• Navigating dual regulations (CAMA + sector laws) can be tricky.

Nevertheless, it has its benefits  

• Complying with capital laws shows seriousness and credibility, which can boost investor confidence.
• You’re set up to scale without frequent corporate restructuring.
• Local stakeholders take your business more seriously when they see your financial commitment.

A step-by-step guide to meeting the share capital requirement  

Assess your financial strategy  

Evaluate how much capital you can allocate to your Nigerian operations. This should cover your required ₦100 million share capital and operational cash flow.

Choose the right business structure  

Decide whether you’re registering a subsidiary, branch, or a new company in Nigeria. Each path has different implications for ownership and tax.

Prepare your paperwork  

Gather:

• Certified copies of foreign parent company documents.
• Statement of share capital.
• Board resolution authorising Nigerian operations.
• Minimum of two Nigerian directors (at least one must be a resident).

Engage the Corporate Affairs Commission (CAC)  

Use the CAC’s online registration portal or work with licensed company secretaries or law firms to handle incorporation.

Open a domiciliary bank account  

You’ll need this to incorporate the share capital into Nigeria and obtain a Certificate of Capital Importation (CCI) from the Central Bank.

The best way to achieve these steps without hiccups is to:

• Work with professionals who are familiar with Nigerian regulatory compliance.
• Plan for currency exchange rates and fund repatriation procedures.
• Keep records of all filings and approvals.

Real-world case studies  

Take a look at two companies who took the bet you are about to take.

MTN Nigeria  

South African telecommunications company, MTN, entered the Nigerian market in 2001.

They registered as a Limited Liability Company (LLC), aligning with Nigerian corporate structures, and complied with share capital requirements.

MTN Nigeria has grown to become the largest telecom operator in the country.

Shoprite Nigeria  

Shoprite, a South African Retail chain commenced operations in Nigeria in 2005.

As expected, they ensured compliance with share capital and other regulatory requirements.

Shoprite successfully established a strong retail presence across Nigeria.

Can your company be the next MTN or Shoprite?

Take a walk through other business case studies and how they handled share capital, compliance, and expansion.

Before you wrap up… Save yourself weeks of confusion and costly mistakes.

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Closing the curtain 

Is the minimum share capital for foreign companies in Nigeria ₦10 million or ₦100 million? Technically, it depends on who you ask.

Understanding and meeting the minimum share capital requirement is a pivotal step for foreign companies aiming to establish a foothold in Nigeria. But in reality? ₦100 million is your best bet unless you enjoy the stress of paperwork.

While the ₦100 million threshold may seem daunting, it serves as a testament to a company’s commitment and readiness to operate in the Nigerian market.

Until there’s a unified directive from the CAC and the Ministry of Interior, foreign-owned companies should err on the side of caution. Better to over-prepare than to be caught off guard mid-registration.

And if you’re ever unsure, get legal advice. Or at least, bookmark this article; it might just save your company a few million naira (and a whole lot of stress).

By engaging with local professionals, meticulously planning financial allocations, and adhering to regulatory mandates, foreign investors like you can navigate the incorporation process effectively and position themselves for success.