PRINCIPAL LAWS ON FOREIGN INVESTMENTS

The principal laws regulating foreign investments are the Nigerian Investment Promotion Commission Decree No. 16 of 1995 and the Foreign Exchange (Monitoring Miscellaneous Provisions) Decree No. 17 of 1995.

DEREGULATION OF EQUITY STRUCTURE IN NIGERIA ENTERPRISES

Effectively, the Nigerian Enterprises promotion (Repeal) Decree No. 7 of 1995 has abolished any restrictions, in respect of the limits of foreign share holding, in Nigeria registered/domiciled enterprises.

The only enterprises which are still exempted from free and unrestrained foreign participation are those involved in:

Production of arms and ammunition;

Production of and dealing in narcotic drugs and psychotropic substances;

PROVISIONS RELATING TO INVESTMENTS

Notable amongst the provision relating to investments are the following:

A non-Nigerian may invest and participate in the operation of any enterprise in Nigeria;

An enterprise in which foreign participation is permitted, shall after its incorporation or registration, be registered with the NIPC.

A foreign enterprise may by the shares of any Nigerian enterprise in any convertible foreign currency.

A foreign investor in an approved enterprise is guaranteed unconditional transferability of funds through an authorised dealer, in freely convertible currency of:

Dividends or profit (net of taxes) attributable to the investment;

Payments in respect of loan servicing where a foreign loan has been obtained; and

The remittance of proceeds (net of all taxes) and other obligations in the event of sale or liquidation of the enterprise or any interest attributable to the investment.

PRIORITY AREAS OF INVESTMENT

The NIPC issues guidelines and procedures which specify priority areas of investments and prescribed incentives and benefits which are in conformity with Government policy.

INCENTIVES FOR SPECIAL INVESTMENT

For the purpose of promoting identified strategic or major investment the NIPC may, in consultation with appropriate Government agencies, negotiate specific incentive packages for the promotion of investment.

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