Tax & Business Matters - Nigeria

CBN Clarifies List of Items Eligible for Foreign Exchange

The Central Bank of Nigeria (“CBN”) on 17 May, 2017 issued a circular clarifying certain items that are eligible for foreign exchange (“FX”) in the Nigerian official foreign exchange market (“FX market”).

This follows the CBN Circular dated 3 May 2017 titled the “Revised Documentation Requirement for Allocation of Foreign Exchange for Small -Scale Importation” which appeared to have lifted the ban on the items classified as ‘not valid for forex’ in relation to small scale importation with a value of not more than USD20,000 per quarter. The CBN thereafter issued a press release to clarify that the May 3 circular did not apply to the 41 items that are currently classified as ‘not valid for forex”. 

Details in our regulatory alert below:

Download Regulatory Alert_Valid for Forex_May2017

National Assembly Passes Petroleum Industry Governance Bill

The Senate has today passed the Petroleum Industry Governance Bill (PIGB). The PIGB is the first of the two or three component parts of the old PIB which has undergone series of re-drafting and extensive legislative considerations without successful passage into law since 2008.

See below our earlier update on the new PIGB below. Watch this space for further details.

Highlights of PIGB

 

Highlights of Executive Orders on Budget, Local Content and Ease of Doing Business in Nigeria

On May 18, 2017, the Acting President, Prof Yemi Osinbajo issued the following Executive Orders -

1. Executive Order on Support for Local Content in Public Procurement by the Federal Government which requires that MDAs utilise made in Nigeria products.
2. Executive Order on Budget which specifies timelines for MDAs to submit their budgets to the Ministry of Finance to facilitate timely submission to the National Assembly; and
3. Executive Order on the Promotion of Transparency and Efficiency in the Business Environment.

Read our alert below for highlights of the Orders.

Download Regulatory Alert_Highlights of Executive Orders on Budget Local Content & Ease of Doing Business

Download Executive Orders_PEBEC Analysis

Key reforms to company registration procedures

According to information made available by the Presidential Enabling Business Environment Council (PEBEC), the Corporate Affairs Commission has stopped receiving manual applications in Abuja, Enugu, Kano, Kaduna and Port-Harcourt.

This means that all applications would need to be submitted via the online registration portal. It is expected that this will be cheaper, faster and convenient for businesses.

Applicants processing new registration in these locations are to complete the application forms and pay the registration fee as well as Stamp Duty (where applicable) on the Company Registration Portal (CRP) and thereafter upload all necessary and duly executed documents through the Corporate Affairs Commission (CAC)’s upload interface.

Efforts are being made to ensure close to zero downtime of the portal. The following numbers of CAC customer service personnel may be contacted for help or feedback on the online registration. James +234-818-229-8971; Jolomi +234-818-229-9016; Eze +234-908-740-1600; Stellamaris +234-908-740-1599 and Joke +234-908-740-1598

Various reforms completed by the CAC over the last few months include:

1. Automatic generation of Tax Identification Number (TIN): Upon completion of company registration, TIN will be sent automatically to the email used for registration.
2. Public search window: This makes it possible to see which company names are available for registration.
3. Electronic stamp duty: It is now possible to get e-stamp registration documents when registering a company.
4. Document upload functionality: This allows applicants to upload and submit all documents including those requiring signatures online without the need for applicants to submit hard copies to the CAC.
5. Consolidated form (CAC forms 1-7 to CAC 1.1): The CAC form online has been streamlined to remove any unnecessary information request in order to make the registration process faster.
6. Certification of registration documents: Direct applicants are no longer required to sign the declaration of compliance before a Commissioner for Oaths or Notary Public.

The efforts to simplify company registration are commendable. We hope these initiatives will be extended to ongoing compliance requirements by existing companies sooner rather than later.

New Foreign Exchange Windows for Investors, Exporters & SMEs

The Central Bank of Nigeria (“CBN”) recently released a circular establishing an Investors and Exporters Foreign Exchange Window (the “New Window”) separate from the current official inter-bank foreign market. The purpose of this new window is to improve foreign exchange liquidity. This is in addition to the SME window recently introduced by the CBN.

Read our regulatory alert for some of the provisions and implications of the new circular.

Download Regulatory Alert_New Forex Windows_April2017

Download ESTABLISHMENT OF INVESTORS' & EXPORTERS' FX WINDOW