How to change my company from a public company to a private company in Nigeria

How to change my company from a public company to a private company in Nigeria

November 22, 2018

First, we will differentiate a private company from a public company.

A limited liability company, also referred to as a private company limited by shares is restricted from offering its shares to the public, while a public company is a company that the transfer of its shares is unrestricted, therefore open to the public to buy shares or debentures or deposit money for fixed periods. Any company that is not a private company shall be a public company and its memorandum shall state so

To convert your company from a PLC to a LTD, you have to re-register it as a LTD, with the following steps;

(a) a special resolution that it should be so re‐registered is passed

(b) an application for the purpose, signed by a director and the secretary of the company is delivered to the Commission together with a printed copy of the memorandum and articles of the company as altered by the resolution; and

The special resolution shall alter the company’s memorandum so that it states that the company is a private company and shall make such other alterations in the company’s memorandum and articles as are requisite in the circumstances.

The application shall be made within 28 days after the passing of the resolution

On hearing the application, the court shall make an order either cancelling or confirming the resolution and may make all such other orders or give such directions as it may think expedient under the circumstances.

The company shall, within 15 days from the making of the court’s order, or with‐in such other period as the court may by order direct, deliver to the Commission a certified true copy of the order.

If a company fails to deliver to the Commission a certified true copy of the order, the company and any officer of it who is in default, shall be guilty of an offence and liable to a fine of NI00 and for continued contravention, to a daily default fine of N25.

If the Commission is satisfied that a company may be re‐registered, it shall‐

(a) retain the application and other documents delivered to it,

(b) register the application and other documents and

(c) issue the company with a certificate of incorporation as a private company.

On the issue of the certificate‐

(a) the company shall become a private company and

(b) the alteration in the memorandum and articles set out in the resolution shall take effect accordingly.

Reference- S.53 CAMA

Team 618 Bees

 

 

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Frequently Asked

  • When are Annual Returns due for filing?

    A company’s first Annual Returns are due for filing after 18 months of its inception, subsequently it should be filed annually as the name implies. The filing dates could differ for each company depending on their financial year end but must be filed not later than 42 days after its Annual General Meeting.

    The Annual Returns for Business Names is due not later than the 30th of June each year except in the year the business was registered.

  • What’s the difference between a business name and an LLC?
    • A business name is a sole proprietorship, usually owned and managed by one individual only. Legally, the sole proprietor and his business are one. It simply means an individual trading with an alias. The sole proprietor is personally liable for all business related obligations.

    • A limited liability company on the other hand is a separate business entity from the individuals that hold its shares and act as directors. Legally, it’s a separate business entity and a person on its own who can transact business, own property separate from its owners and can sue or be sued. 

  • What are the penalties for not registering my products with the SON?
      1. Seizure of goods by the Inspectorate and Compliance Directorate
      2. Payment of a fine.
      3. Prosecution

     

  • Can my kids be shareholders in my company?

    Yes your kids can hold shares in your company but there must be a minimum of two adult shareholders before kids can be included.

  • Can I trademark my logo and name separately? Why is this a good idea?

    Yes you can. The advantage is that it gives you the opportunity to have more than one logo or the opportunity to change your logo easily as opposed to registering the name and the logo as one trademark.

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