The 1999 Constitution grants the Federal Legislature exclusivity in respect of company registration and ancillary matters.
That exclusivity was in turn vested on CAC through the Companies and Allied Matters Act with respect to company registration.
CAC also has responsibility for business name registration and incorporation of non-profit organizations and associations.
Although CAC has zonal offices across major cities in Nigeria, these zonal offices serve more as collection centers while the main operations are still carried on in Abuja.
The process of incorporation or business name registration starts with an application for name reservation and availability, a process that takes from one to three months.
The actual issuance of certificates of registration and incorporation which can only be done in Abuja takes a further one to two months.
Transacting with incorporation documents of already registered entities is even more nightmarish as the CAC still relies on hard files for storing documents.
In a country of 140 million people, there are less that 1, 000, 000 registered companies with even fewer registered non-profit associations or organizations.
Records may not be readily available for the number of registered business names but with the long drawn out registration procedure the figures may not be encouraging.
The process of company incorporation is further compounded by the requirement for the payment of stamp duties to the Federal Inland Revenue Service.
The limited liability company is the recognized vehicle for conducting business across the nations of the earth, and this is what makes the record of CAC abysmal.
The corporate structure allows two or more persons to commence a business as shareholders while limiting their liabilities to the number of shares they subscribe to.
In situations where those shares are fully paid for the company structure allows the shareholders to partake of the profits while having nothing to do with its losses.
The company as it were is regarded as having a separate legal personality different from its ownership thus allowing it to acquire and sell assets in its own name.
This means that a company has what in law is referred to as ‘Perpetual Succession’, i.e. it can survive beyond the death of its founders or shareholders.
The company may have a management structure that is different from its ownership structure with its affairs run by the board of directors.
These directors may also not be shareholders of the company and in advanced economies the requirement of independent directors is taken seriously.
Business name registration on the other hand allows an individual to register a trade name for business or work purposes although that individual bears the profits and losses.
Although it does not provide the protection of limiting the liability of its owners, business name registration allows a business to have a distinct identity.
It also enables the owners to operate bank accounts using the business name and to print invoices, complimentary cards, letter headings and name signs using that name.
Incorporated trustees registration are for religious, educational, charitable, community and other such like registrations, entities established usually for non-profit purposes.
Whatever type of registration is carried out allows Nigerians to either individually or in groups to conduct their affairs in structures that are recognized by law.
Also searches can easily be conducted to inquire into their ownership structures and regarding how their business affairs are conducted to satisfy disclosure requirements.
This is why the process of companies transiting from private limited liability status (membership not exceeding 50) to public limited liability is quite cumbersome.
Public limited liability companies can offer their shares for sale to members of the public and those shares can also be traded in the Nigerian Stock Exchange.
Public limited liability companies thus have the added advantage of being able to raise funding from the general public to fund or expand their business operations.
CAC has to be commended for its accomplishments over the years especially in a nation with a mono-economic product and centralized government control.
However with the waning of the influence of oil and gas in a global economy in recession, time is ripe for the deregulation of business registration.
This is to compliment the diversification and deepening of the nation’s economy with the increasing recognition that Nigerians and not commodities are its main resource.
Nigerians have always been commercially minded and this is supported even by documented history, even long before the arrival of British Colonialists.
Majority of Nigerians operate extra-legal businesses outside the reach and protection afforded by the law mainly due to the monopoly enjoyed by CAC.
Government is the looser when majority of its business minded citizens operate extra-legally and with only the Federal Government collecting corporate taxes.
The time is ripe for business registration to be undertaken by all tiers of government and the private sector.
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