Nigeria free trade zones in 2023
Healy Consultants assists our international Clients with Nigeria free trade zone company incorporation. Investors willing to start a Nigeria Free Trade Zone companies can do so in one of the following Nigeria export processing zones: Calabar free trade zone (CFTZ), Kano free trade zone (KFTZ), LADOL free zone, ALSCON expert processing zone, Onne oil and gas free zone, and Maigatari border free zone.
Advantages of a free zone company
- Nigeria boasts 14 operational Special Economic Zones, offering foreign companies i) a tax holiday on all taxes including federal, state, and local government taxes ii) duty free importation iii) 100% repatriation of capital, profits, and dividends;
- Business is simplified for such companies. These companies are exempt from all import and export licensing and all expatriate quotas, and one-stop approval is available for permits, operating licenses, and Nigeria business registration;
- All new industrial undertakings including foreign companies and individuals operating in a special economic zone, are allowed full tax holidays for three consecutive years.
- Calabar is designated as the primary zone in Nigeria. Government incentives include i) zero corporation tax ii) unrestricted remittance of profits and dividends iii) no import or export licenses required iv) up to 100% foreign ownership of enterprises v) sale of up to 25% of production is permitted in domestic market vi) all exports are vat zero-rated and vii) dividends received from investment in export-oriented businesses are to be free of tax.
- Companies formed in these zones are allowed to sell 100% of their goods into the domestic Nigerian market, while paying a significantly reduced import duty on manufactured goods sold domestically;
- Land is rent-free for the first 6 months, for any construction project undertaken in the zones.
Table comparing different special economic zones in Nigeria
| Summary at a glance | CFTZ | KFTZ | LADOL | ALSCON |
|---|---|---|---|---|
| Average annual Industrial space rent per 1000 sq ft | US$5,100 | US$6,500 | US$6,200 | US$2,100 |
| How long to set the company up? | 10 weeks | 10 weeks | 10 weeks | 10 weeks |
| How long to open company bank account? | 2 weeks | 2 weeks | 2 weeks | 2 weeks |
| Quality of utilities | Poor | Average | Average | Poor |
| Allowed to sign sales contracts with Nigerian Clients | Yes | Yes | Yes | Yes |
| Allowed to invoice Nigerian Clients | Yes | Yes | Yes | Yes |
| Corporate tax payable in Nigeria | 0% | 0% | 0% | 0% |
| Corporate bank account | SCB | SCB | SCB | SCB |
| Physical office space required | Yes | Yes | Yes | Yes |
| Industrial space availability | Yes | Yes | Yes | Yes |
| Allowed to import raw materials? | Yes | Yes | Yes | Yes |
| Allowed to export goods? | Yes | Yes | Yes | Yes |
| Wholly foreign owned | Yes | Yes | Yes | Yes |
| Can the entity hire expatriate staff in Nigeria? | Yes | Yes | Yes | Yes |
| Do you visit Nigeria for company incorporation? | No | No | No | No |
| Minimum number of directors | 2 | 2 | 2 | 2 |
| Minimum number of shareholders | 2 | 2 | 2 | 2 |
| Tax registration certificate required | Yes | Yes | Yes | Yes |
| Individual shareholders allowed | Yes | Yes | Yes | Yes |
| Corporate shareholders allowed | Yes | Yes | Yes | Yes |
| Corporate director(s) allowed | No | No | No | No |
| Public register of shareholders and directors | Yes | Yes | Yes | Yes |
| LLC company allowed | Yes | Yes | Yes | Yes |
| Can apply for immigration visas | Yes | Yes | Yes | Yes |
| Annual audited financial statements | Yes | Yes | Yes | Yes |
| Annual tax return to be submitted | Yes | Yes | Yes | Yes |
| Access to Nigeria double tax treaties | Yes | Yes | Yes | Yes |
