1.What is the current legal landscape for Foreign Direct Investment Law in your jurisdiction?

The regulation of Foreign Direct Investment (“FDI”) in Nigeria is governed by a mix of domestic laws, bilateral treaties, and administrative guidelines administered by various regulatory bodies. The principal legislations governing FDI in Nigeria includes the Nigerian Investment Promotion Commission Act, 1995 (the “NIPC Act”), the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, 1995 (“FEMMP Act”), and the Companies and Allied Matters Act, 2020 (the “CAMA”).

The NIPC Act established the Nigerian Investment Promotion Commission (the “NIPC”), which serves as a one-stop investment facilitation centre coordinating twenty-seven (27) governmental and parastatal agencies to streamline administrative procedures for foreign investors. The NIPC is mandated to encourage, promote and coordinate investments in Nigeria, providing a centralised platform for investment promotion activities.

Foreign investors in Nigeria may own one hundred per cent (100%) equity in Nigerian companies across all sectors except those listed on the “negative list,” which prohibits both foreign and Nigerian investment in specified industries. The prohibited sectors include production of arms and ammunition, production of and dealing in narcotic drugs and psychotropic substances, production of military and para-military wear and accoutrements, including those of the Police, Customs, Immigration and Correctional Services, and such other items as the Federal Executive Council may determine.

A fundamental requirement for foreign investment is that any foreign company intending to carry on business in Nigeria must, pursuant to section 78 of CAMA, be incorporated in Nigeria under CAMA, except where the Minister of Trade & Investment grants an exemption under section 80 of CAMA. This incorporation requirement applies whether the foreign participation is wholly owned or a joint venture with local investor(s). Once incorporated, such companies must, pursuant to sections 19 and 20 of the NIPC Act, register with the NIPC before commencing business operations.

The NIPC Act provides comprehensive protections for foreign investors. Section 24 of the NIPC Act guarantees unconditional transferability of funds through authorised dealers in freely convertible currency, including dividends or profits, payments for loan servicing, remittance of proceeds from liquidation of enterprises, and remittance of foreign personnel earnings. The FEMMP Act complements this by regulating the inflow and outflow of foreign capital, ensuring investors can repatriate profits and capital without undue restrictions, provided they are imported through authorised dealers and issued certificate(s) of importation (section 15, FEMMP Act).

The NIPC Act also protects against expropriation, prohibits nationalisation except in cases of national interest or public purpose, and mandates prompt, adequate and fair compensation in accordance with international law. Additionally, section 26 of the NIPC Act grants foreign investors recourse to international arbitration for dispute settlement, with provision for application of the International Centre for Settlement of Investment Disputes Rules where parties disagree on the dispute resolution mechanism.

Nigeria has established an extensive network of international investment agreements to enhance investor protection. The country has signed bilateral investment treaties with 31 countries, of which 15 have been ratified by both parties, such as China, France, Finland, Germany, Italy, the Republic of Korea, the Netherlands, Romania, Serbia, South Africa, Spain, Sweden, Switzerland, Taiwan, and the United Kingdom. These Investment Promotion and Protection Agreements (“IPPAs”) provide baseline protections, including fair and equitable treatment, protection against expropriation without compensation, and recourse to international arbitration. Nigeria has also concluded Double Taxation Agreements with Belgium, Canada, China, the Czech Republic, France, Italy, Pakistan, the Philippines, Romania, the Slovak Republic, South Africa, the Netherlands, and the United Kingdom, providing relief from double taxation on income and capital gains.

As a member of the Economic Community of West African States (“ECOWAS”), Nigeria benefits from the ECOWAS Trade Liberalization Scheme, which promotes free movement of goods and services, abolition of customs duties on imports and exports among member states, and elimination of non-tariff barriers across the fifteen (15) member countries.

Technology transfer is subject to regulation by the National Office for Technology Acquisition and Promotion (“NOTAP”). Where a foreign company enters into contracts requiring technology transfer into Nigeria, such contracts must be registered with NOTAP, which issues either a certificate of approval or a certificate of rejection. Failure to register technology transfer agreements with NOTAP prevents the Central Bank of Nigeria (“CBN”) from approving repatriation of funds, as the CBN requires the NOTAP certificate of approval as proof of registration.

Immigration requirements for foreign investors are governed by the Immigration Act, 2015 (the “Immigration Act”), which regulates the issuance of business permits, expatriate quotas, and work permits through the Nigeria Immigration Service. The Immigration Act prohibits foreign investors from establishing firms or conducting business in Nigeria without obtaining the necessary permits or visas. Available permits include the Subject to Regularization Visa, Combined Expatriate Residence Permit and Aliens Card, Temporary Work Permit, and Temporary Residence Visa.

Companies incorporated in Nigeria with foreign participation must, pursuant to a public notice issued by the CAC (the “CAC Notice”) in 2023 and the Revised Handbook on Expatriate Quota Administration, 2022 (“Handbook”), issued by the Federal Ministry of Interior, have a minimum share capital of ₦100,000,000 (One Hundred Million Naira). While the public notice was withdrawn, the CAC has continued to enforce the ₦100,000,000 (One Hundred Million Naira) minimum share capital for companies with foreign participation incorporated prior to the issuance of the CAC Notice and the Handbook. In addition, business permits are only granted to companies with foreign participation where they have a minimum paid-up share capital of ₦100,000,000 (One Hundred Million Naira).

2. What three essential pieces of advice would you give to clients involved in Foreign Direct Investment matters

Ensure Proper Corporate Structuring and Registration from the Outset.

Foreign investors must incorporate a separate Nigerian company under CAMA with the minimum share capital before commencing business operations, except where a ministerial exemption is granted. Beyond incorporation with the CAC, businesses must register with the NIPC and obtain necessary approvals from sector-specific regulators, and with NOTAP where there are technology transfer arrangements/agreements. Proper structuring at inception, including determining the appropriate ownership model, securing requisite permits and/or approvals such as expatriate quotas and business permits, and ensuring adequate capitalisation, prevents costly regulatory delays and compliance issues that could jeopardise operations.

Leverage Investment Protection Mechanisms and Understand Sectoral Restrictions.

Nigeria’s legal framework provides robust guarantees for foreign investors, including unconditional transferability of funds, dividends, and profits in freely convertible currency, protection against expropriation without prompt and adequate compensation, and recourse to international arbitration for dispute settlement under Section 26 of the NIPC Act. Investors from countries with bilateral investment treaties or double taxation agreements with Nigeria should structure investments to maximise these protections. However, clients must carefully review the negative list of prohibited sectors and understand local content requirements in strategic industries such as oil and gas. Understanding both the protections available and the boundaries imposed ensures investments are structured for long-term viability and regulatory compliance.

Explore Tax Incentives.

Nigeria’s tax landscape, effective January 1, 2026, marks a decisive shift in how incentives are designed and administered. The newly-introduced reforms move away from broad, blanket tax holidays that often lacked accountability, toward performance-based, sector-specific reliefs that reward measurable contributions to the economy. Foreign investors must therefore adopt optimal tax-efficient structures to fully maximise incentives.

3. What are the greatest threats and opportunities in Foreign Direct Investment law in the next 12 months?

Opportunities

Tax Reform Implementation and Incentive Optimisation.

The Tax Reform Laws, which took effect on January 1, 2026, present significant opportunities for foreign investors to restructure their operations and capitalise on new incentives. The Economic Development Tax Incentive (“EDTI”), which replaces the Pioneer Status regime, creates opportunities for more businesses that provides designated priority products or services and meet minimum required capital for investment. Companies already enjoying Pioneer Status under the Industrial Development (Income Tax Relief) Act will continue to enjoy that relief until the end of their approved pioneer period but cannot benefit from the EDTI at the same time. This is particularly advantageous for manufacturing companies and companies engaged in activities of other designated priority sectors where substantial capital deployment aligns with both business growth objectives and national development priorities. One of the criteria for inclusion as a priority sector is for the attraction of inflow of foreign investment.

The EDTI provides a tax credit equal to 5% per annum of qualifying capital expenditure acquired, which may be applied to reduce company income tax payable for a period of five years commencing from the production day, with an option for extension for additional five years where the profits generated during the incentive period are fully reinvested in the expansion of the same product or products. Unutilised economic development tax credit can be carried forward for additional five years after the end of the priority period.

Digital Economy and Fintech Expansion

Nigeria’s rapidly growing digital economy, particularly in fintech, e-commerce, and technology services, continues to attract substantial foreign interest. The government’s push for digital transformation is positioning Nigeria as a strategic gateway to West African markets present growth opportunities for investors in technology infrastructure, payment systems, and digital services.

Threats

Nigeria’s economy faces mounting pressures from inflation, high interest rates, and rising public debt, all of which point toward tighter fiscal policies. Inflation, driven by food prices, energy costs, and currency depreciation, erodes consumer demand and raises business costs, while the CBN’s high interest rates make borrowing expensive and limit access to credit. At the same time, growing debt burdens crowd out government spending on infrastructure and social programmes, increasing the likelihood of new taxes, levies, or reduced incentives as the Government seeks revenue. For investors, this means profitability could be squeezed by higher costs and stricter compliance, but opportunities remain in resilient sectors such as renewable energy, technology, and agriculture, where targeted incentives may offset the challenges of Nigeria’s tightening fiscal climate.

4. How do you ensure high client satisfaction levels are maintained by your practice?

Our Foreign Direct Investment Practice is distinguished by depth of expertise and a commitment to excellence. Our basic philosophy while advising our clients is to work as a team with the client, to be proactive, sensitive, creative, and responsive to their needs and aspirations. We consistently invest in the continuous development of our people, ensuring that every member of our team is fully abreast of Nigeria’s evolving investment landscape, regulatory frameworks, and cross-border transaction structures.

First, we invest time to understand the client’s investment objectives, sector focus, operational requirements, and long-term strategic goals. Nigerian investment law is not applied in a vacuum; its implications differ significantly across sectors such as oil and gas, telecommunications, fintech, manufacturing, infrastructure, and real estate. For instance, the regulatory approvals, local content requirements, and foreign ownership restrictions that apply to a technology startup differ sharply from those of an oil and gas joint venture or a manufacturing entity. The capital requirements, expatriate quota considerations, technology transfer obligations, and repatriation procedures vary considerably depending on the nature and scale of the investment. By understanding these nuances and aligning our legal solutions with the client’s commercial objectives, whether establishing a wholly-owned subsidiary, structuring a joint venture, navigating sectoral restrictions, or optimising investment protection mechanisms, we ensure that our advice is not only technically correct but also contextually valuable and commercially practical.

Secondly, we recognise that one of the greatest challenges foreign investors face in Nigeria is regulatory uncertainty, administrative unpredictability, and inconsistent enforcement across multiple government agencies. We prioritise staying fully updated with legislative amendments, policy shifts, and regulatory practice in the foreign investment space. Our team continuously monitors developments from the NIPC, CAC, CBN, NOTAP, Federal Ministry of Interior, Securities and Exchange Commission, and sector-specific regulators. This constant monitoring allows us to interpret new directives accurately and promptly, whether regarding minimum share capital enforcement, expatriate quota procedures, or changes to sectoral restrictions. We also issue regular client update alerts on all investment law reforms, policy announcements, bilateral treaty developments, and regulatory guidance. Clients are promptly informed of any changes that could impact their investment decisions or compliance obligations, such as new registration requirements, revised approval timelines, currency controls, or sectoral policy shifts. Our partners and associates make themselves available for prompt consultation, whether through calls, emails, or meetings (virtual or physical), recognising that investment decisions often require rapid turnaround and real-time guidance.

Thirdly, we integrate technology, project management, and strategic regulatory engagement into service delivery. We also leverage our established relationships with regulatory authorities to facilitate constructive engagements, clarify ambiguous requirements, and expedite approvals where possible, while maintaining full transparency and compliance with all legal frameworks.

5. What technological advancements are reshaping Foreign Direct Investment law and how can clients benefit from them?

The NIPC now operates a designated online registration portal where companies with foreign participation can complete business registration by submitting application forms with supporting documents, with applications typically approved within two to three days. Similarly, the CAC has established an AI-powered online company registration portal enabling investors or their agents to conduct name searches, complete required forms, submit incorporation documents, and pay fees remotely. These digital platforms significantly reduce the bureaucratic delays that historically plagued foreign investment establishment in Nigeria. Incorporation of limited liability companies can be completed in as little as two to five business days if there are no issues with the application.

Beyond incorporation and NIPC registration, the Nigeria Startup Support and Engagement Portal facilitates labelling of Nigerian startups and registration of venture capitalists, angel investors, accelerators, incubators and innovation hubs under the Nigeria Startup Act 2025 (the “Startup Act”). Foreign investors targeting Nigeria’s vibrant startup ecosystem can leverage this platform to identify partnership opportunities and understand tax and fiscal incentives available under the Startup Act.