In this post, I will show you statutory requirements for registration/ formation of a construction company, services involved, required licenses/ permits to start and how to start construction business in Nigeria. A construction company need to be a limited liability or public limited liability company.
A construction company in Nigeria is a company that are into Road construction, Building/ structure Construction, Bidge construction, etc
How to Start Construction Company in Nigeria
Plan Your Construction Company
Before starting a business, a good business plan is of paramount importance, as it organizes your priorities and help you make wise decision.
Planning properly will help you decide if you are going to specialize in specific niche such as commercial retail work, or if you will offer a variety of services.
Under this category, it would be wise to set short and long term goals, decide what services you will offer, find a niche – what will be your specialty?
What will make you different from your competitors? , choose a business name for yourself, decide what you will charge for your services, decide whether you will need a loan to start the business or not.
Technology Needed to Start a Construction Company
You can’t start a construction company without tools and equipment. Equipment may account for the largest cost before starting up. Therefore, you don’t necessarily need all brand new tools and equipment, also buy or hire tools as jobs require them to avoid going into debt for tools and equipment you may end up not using.
Formation of Construction Company in Nigeria
It is essential that you register your company with corporate affairs to avoid being shut down by government or agency in charge sanctioning non registered company. You may need a business support firm like Aziza Nigeria or a Lawyer/ Law firm in Nigeria to complete the company formation/ registration. Below steps may be follow.
- Select your business structure (Sole Proprietor, Private Limited Liability, Public Limited Liability, etc)
- Choose a business name
- Supply all the requirements
- Appoint a company secretary
- Complete company formation and obtain Certificate and other supporting documents.
- Open a business bank account
- Commence business
- Filling returns to Tax authority and then obtain Tax Clearance Certificate. You need a Tax Consultant for this. You can choose Aziza Nigeria for your Company Tax Clearance Certificate.
Construction Company Statutory Formation Requirements
A construction company need to be private limited liability or Public Limited Liability company. For a private limited liability, the minimum authorised share capital as a Nigerian is one million share capital. Note, this is npt a monatory value of the registration. It is however worth noting that the minimum authorized share capital for Nigerian companies with foreign participation is ten million share capital.
For a construction company to go public as a public limited liability company, it is required to have a minimum authorised share capital of two million.
Construction Company to go into Real Estate Investment Trust
The minimum authorised paid up share capital for a Fund Manager is one hundred and fifty million, while the minimum paid up capital for the Trustees is three hundred millions. An initial public offer for units of the investment scheme must be a minimum of NGN1 billion, while subsequent offers cannot be less than NGN500 million.
Construction Company to go into Real Estate Investment Company
A private limited company is required to have a minimum authorised share capital of ten million while a public company is required to have a minimum authorised share capital of five hendred million shares. An initial public offer for units of the investment scheme must be a minimum of one billion shares, while subsequent offers cannot be less than hendred million shares.
Certification, Permits & Licensing
You may need some other Regulatory Compliances (Permits & Licenses) to operate in some sectors of the economy. Example, you will need Local content Certificate and DPR Permit to operate in Nigerian Oil & Gas sector.
Contact us for Regulatory Compliances in Nigeria. Obtaining the necessary regulatory compliances will help you to start up and run your business legally.
Conclusion
The demand for construction service is ever on the high, especially in a developing country like Nigeria. This is due to the increasing demand for building and structures meant for various purposes, as well as renovation of existing ones.
When you think of starting a construction service in Africa, think of Nigeria.
When you need a Regulatory Compliances / Business Support service for your formation of Construction Company in Nigeria, choose Aziza Nigeria.