Manufacturing in Nigeria increased 3.40 percent in March of 2018 over the same month in the previous year[1]. This statistics highlights the growing concern and prospects in local manufacturing businesses in Nigeria.  However, in terms of the legal regulatory regime, the regulatory requirements differ according to the industry even though there are some generally applicable regulations.  It is therefore important to point out, as a preliminary point, that inquiry into the specific industry regulations for your chosen production or manufacturing business is always an essential first step. This article, we will however consider the general laws, compliances and procedures while leaving out the specifics for consultation.

General Legislations regulating manufacturing in Nigeria

In establishing a manufacturing out-fit in Nigeria, some of the legislations which would generally apply are:

  • Companies and Allied Matters Act
  • Companies Regulations 2012
  • National Environmental Standards Regulations Enforcement Agency (Establishment) Act;
  • Environmental Impact Assessment Act
  • National Agency for Food and Drug Administration and Control Act;
  • Factories Act;
  • Standards Organization of Nigeria Act;
  • Nigerian Investment Promotion Commission Act
  • Investment and Securities Act
  • Companies Income Tax Act
  • Value Added Tax Act
  • Local Content Act
  • Nigeria Export Processing Zones Authority (Act No.63 of 1992)
  • Free Trade Zone Regulations; etc

Companies and Allied Matters Act

The Companies and Allied Matters Act (CAMA) Cap C20 LFN 2004 is the most significant legislation in Nigeria which regulates the incorporation and registration of companies. The Act establishes the Corporate Affairs Commission (CAC) and empowers the body to regulate the incorporation of companies in Nigeria. [2]The CAC is also empowered by the Act to set regulations for companies and pursuant to these powers the Companies Regulation 2012 was passed.

The CAMA, CAC Act and Companies Regulations are all effective in the incorporation and registration of companies.  It is however noteworthy that for some industries, it may be required that you obtain agency pre-approval or licences before incorporating your manufacturing out-fit as a company[3].

In summary, to incorporate a manufacturing company with the CAC in Nigeria you are required to:

  • Check for availability of your proposed company name and send an application to reserve the name with the CAC.
  • Complete a pre-registration form (Form CAC1.1)
  • Pay filing fees to the CAC and Stamp duty fees
  • Prepare and submit the incorporation documents which would include Form CAC1.1, the Memorandum and Article of Association (MEMART)of the Company, Recognized form of identification for Director(s)/Subscriber(s) and Secretary, Evidence of payment to CAC.
  • Once the incorporation is completed you would be issued a certificate of incorporation which gives your company all the legal benefit and burdens of a corporate entity.

National Environmental Standards Regulations Enforcement Agency (Establishment) Act

The National Environmental Standards Regulations Enforcement Agency (Establishment) Act establishes the National Environmental Standards Regulations Enforcement Agency (NESREA) which is the agency having responsibility for the protection and development of the environment and responsible for the enforcement of environmental standards, regulations, rules, laws, policies and guidelines in Nigeria.

A NESREA issues and regulates the issuance of Environmental permit(s) to enable businesses and industrial facilities whose operations may have potential impact on the environment to be environment-friendly in their operations and to also comply effectively with the relevant environmental standards and regulations. The permits are categorized into the following five (5) main groups[4]:

  • Air Quality Permit relating to issues on Atmospheric Emissions, Vehicular Emissions, Open Burning, Refrigeration and Air Conditioning equipment (RAC), and Noise;
  • Waste and Toxic Substances Permit relating to issues on Waste Generation, Restricted Chemicals, Sludge Disposal and Effluent Discharge;
  • Used Electrical and Electronic Equipment (UEEE) Permit relating handling, import and export of UEEE; and
  • Biodiversity Conservation Permit relating to issues on Assess to Genetic Resources.
  • Eco-Guard Certification

NESREA also enforces compliance with the Environmental Impact Assessment Act and requires National Evidence of Environmental Impact Statement (EIS) – Environmental Management Plan (EMP); Environmental Audit Report (EAR) and a Monthly Monitoring Report (where applicable) before granting permit for the operation of a manufacturing outfit.

National Agency for Food and Drug Administration and Control Act

The National Agency for Food and Drug Administration and Control Act Cap N1 LFN 2004, establishes the National Agency for Food and Drug Administration and Control (NAFDAC) which designates, establishes and approves quality specifications in respect of food, drugs, cosmetics, medical devices, bottled water and chemicals, necessary for their certification[5]and issues relevant guidelines and measures for quality control in these industries. Manufacturing in any of these areas require an approval from NAFDAC which is usually only granted after proper inspection of the manufacturing plant by the officials of the Agency.

In summary to obtain a NAFDAC permit requires:

  1. Proper preparation and submission of required registration documents and application letter in accordance with the issued guidelines of NAFDAC for such industry.
  2. Provision of information and description of the facility for inspection.
  3. Provision of samples of the products to be registered when notified by NAFDAC for laboratory analysis.
  4. Payments of statutory fees.
  5. Ensure all documents are complete and with the appropriate description to prevent unnecessary delays.

Note that: A client is mandated to comply with the NAFDAC Compliance Directive (CD) within 7 days of issuance and failure to do so may be basis for cancellation of the application


Factories Act

The Factories Act Cap F1 LFN 2004, provides for the registration and regulation of factories and other legal requirements for the operation of factories. The law is principally administered by the Federal Ministry of Labour and Employment which issues guidelines for the operations of factories and manufacturing industries in Nigeria.


The Factories Act authorizes the Factories Inspectors Department of the Federal Ministry of Labour and Employment to register all factories located in Nigeria and further provides for basic safety and health measures that must be put in place on the premises. Some of these safety and health measures required are as follows :[6]

  • Every factory must be kept in a clean state, and free from effluvia arising from any drain, sanitary convenience or nuisance.
  • The factory shall not be overcrowded while work is being carried on, in order to avoid risk or injury to the health of employees.
  • Effective and suitable provision shall be made for the circulation of fresh air into each workroom, that is, adequate ventilation must be ensured.
  • Maintenance of sufficient and suitable lighting.
  • Adequate provision for drainage of wet floors.

In addition to the foregoing, the National Policy on Occupational Safety and Health[7]also imposes a duty on manufacturers who design, manufacture or import an equipment, article or substance for the use at work to ensure the product is safe for use without health risks when properly used, and to ensure that adequate information is available in connection with the safe operation of machines and use of products.[8]


Standards Organization of Nigeria (SON) Act

The Standards Organization of Nigeria Act, Cap S9 LFN 2004 establishes the Standard Organization of Nigeria (SON) which is empowered to establish a mandatory conformity assessment programme for locally manufactured products in Nigeria.[9]A SON issued Mandatory Conformity Assessment Programme (MANCAP) Certificate must be sought and obtained before distribution of the manufactured products can be had in Nigeria.


Obtaining the MANCAP certification requires:

  • Inspection of the production processes.
  • Sampling and testing of the products against the relevant Nigerian Industrial Standards (NIS) to confirm compliance through conformity assessment processes.
  • Report of inspections and test results are compiled by State Offices and forwarded to the Product Certification Directorate for evaluation and recommendation for SON Management’s approval for certification.
  • If the product meets the requirement of the relevant Nigerian Industrial Standard, MANCAP certificate and the MANCAP logo which bears a unique number for that product is issued for the product upon payment of the applicable administrative charges.

Every issued MANCAP certificate is valid for 3 (three) years after which the product must undergo recertification.


Nigerian Investment Promotion Commission Act

The Nigerian Investment Promotion Commission (NIPC) Act No. 16 of 1995, establishes the Nigerian Investment Promotion Commission and with its establishment repealed series of hitherto laws that imposed strict control on foreign investment, established the legal foundation for a very liberal and open investment framework, encouraged inflow of foreign investments in all sectors of the economy including manufacturing, allows foreigners to invest and participate in the operation of any Nigerian enterprise without any restriction, allows 100% foreign ownership of manufacturing agencies (however, in the oil and gas sector, investment stays limited to joint ventures or production-sharing agreements), and guarantees 100% repatriation of profits/dividends to home country in any convertible currency.

The NIPC generally creates certain incentives for manufacturing and industries in Nigeria as a means of encouraging foreign investment in local industries. Some of the legal protection and incentives include under the Act are applicable to manufacturing in Nigeria includes Tax Incentives for certain manufacture industries, including pioneer industries.


Other Important legislations:

  • Investment and Securities Act: This Act establishes the Securities and Exchange Commission (SEC) which is the agency that regulates shares and investment in Nigerian companies. SEC also grants approval for manufacturing companies intending to make sales of its shares open to the members of the public through the Nigerian Stock Exchange.
  • Companies Income Tax Act: This Act makes provision for the taxation of company income in Nigeria. Under the Act Companies are required to file their tax returns with the Federal Inland Revenue Service (FIRS). Companies are also required to file personal income taxes as pay as you earn (PAYE) for all their employees. The Act sets the period within which company income taxes are payable.
  • Value Added Tax Act: This is also another tax legislation which imposes the Value Added Tax (VAT) which makes provision for taxes on goods and services that are transacted in by the manufacturers. Finished products are usually subject to VAT.
  • Other significant regulations: Local Content Act: Nigeria Export Processing Zones Authority (Act No.63 of 1992), Free Trade Zone Regulations; etc
  • Manufacturers Associations: There are various industry specific manufacturing association in Nigeria which seek to protect the collective interests o of members and investors in those sectors. For manufacturing the Manufacturers Association of Nigeria (MAN) is the umbrella body and is a company limited by guarantee whose main objective is promoting the interest of manufacturers in the country. Membership of MAN in voluntary and MAN offers certain benefits to its members such as business linkage, credibility as a manufacturer, access to up-to-date business information etc.



Nigeria is the top recipient of FDI in Africa with GDP rate that averaged more than 5% over the last decade. This has been largely due to the attempt by the government to liberalize the business environment to accommodate the private sector as the vehicle of growth in a circle where the government remains the enabler[10].  With this more, there are numerous opportunities for investment being created in the manufacturing industry.


The above information is for educational purposes only and does not constitute professional advice by Blackwood & Stone LP.



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[3]For instance the DPR Guidelines for Grant of Permit/Approval/License for Lube Oil Blending/Waste Oil Recycling Plants requires the obtaining of Permit to Establish a Plant, Approval to Construct and License to Operate


[5]Section 6 of the NAFDAC Act

[6]Section 7 – 12 of the Factories Act, Cap F1 LFN 2004.


[8]Paragraph 5.5 of the National Policy on Occupational Safety and Health 2006.

[9]Section 5 of the Standards Organization of Nigeria Act, Cap S9 LFN 2004.