Real Estate Law: Essentials on How to Lawfully Buy Land in Lagos, Nigeria

Apr 23, 2024 admin No Comment 89 Views

Buying or Leasing Property in Lagos and the Real Estate Law generally in Nigeria play a vital role on rules regulating human habitation, commercial, residential leases & development and business since land or property is one of the most important factors of production and the effects on people and businesses are enormous in real estate and property sector of Nigeria economy.

The law that primarily govern Land purchase in Nigeria are Statutes, Common Law, Case Law, Customary Law and Land use Act of 1978, with other amended laws in each State of Nigeria.

IMPORTANT LEGAL QUESTIONS A LAND BUYER MUST ASK  

Lagos Property

• Physical inspection of the land or property by a representative or buyer.
• Request for all legal & title documents in respect of the land showing the names of:

1. The Seller
2. For company- at least two Directors & signatures
3. Trustees – at least three persons and their signatures
4. State & Federal Government

• The buyer must ask questions on whether there is any litigation on the land or property.
• Request for Court Registered WILL or Letter of Administration/Probate Documents in respect of an inherited land.
• For Family Properties – Legal Documents showing the source of title of the Family land and the Deed must be signed by Head of the Family and Principal members of the Family accredited to sign.
• For State and Federal Government Land:

1. Copy of Deed of Sublease between the State or Federal Government
2. Letter of Allocation
3. Evidence of full payment of the Allotee Land price paid to the Government
4. Land Purchase Receipt

• For Lekki & Epe Areas, most of the Land in this area are acquired by the State Government and released by the State Government by way of legal title given to the family called Land Excisionand which are usually Gazetted. it is an equivalent of Certificate of Occupancy to the family.

1. The buyer of Lekki Land or Property must ask for a copy of Excision already Gazetted by Lagos State Government the Survey Plan of the Land must be Charted by the Surveyor at Survey Department to determine whether it is an Acquired Government Land not good for purchase or not.
2. Copy of source of the title of Seller.
3. Evidence of documents of the family on the land.
4. Copy of Consent from Lagos State Government.
5. Land Purchase Receipt

After being satisfied with all the questions and demands above, the Attorney can go ahead to conduct a legal search on the property.

• The conduct of search at the Land Registry must include:

1. Particulars of the property
2. Date of search
3. Place of search
4. Name of the owner
5. Nature of the interest or whether there is a mortgage or liability on it
6. Result of the Search whether there is an Encumbrance (meaning problem or negative legal interest) on the land or not.
7. Comment and opinion of a lawyer on the search report whether the land is good to buy or not.

If the Attorney is satisfied with the result of the land title investigation, he will accordingly give a legal advice to the buyer to purchase the land or property or not.

The next step will be for the buyer to instruct a Licensed Land Surveyor to prepare a Survey Plan for the property in the name of the new buyer.

Note, the registered Survey Plan must show (a) Location and address (b) Size of the land in Square Meters, (c) Shape of the land and all the registered Beacons numbers on the Survey with Surveyor’s General Signature and Record copy duly lodged at Surveyor’s General office either in State or Federal Level.

• The Solicitor will use the new Survey to prepare one of the following: Contract of Sale, Deed of Sub-lease, or Deed of Mortgage and Deed of Assignment which are different types of evidence of transfer of legal ownership to the new buyer.
• Deed of Assignment to be prepared by the Lawyer must contain the following particulars of information:

1. Names, Occupation and Address of Parties usually referred to Assignor (seller) and Assignee (buyer)
2. Names and Occupation and Addresses of the Witnesses
3. Description of the Property
4. Capacity of the Vendor/Assignor
5. Consideration i.e. price of the Land
6. Quantum of interest to be transferred
7. Covenants or terms of the contract of sale

 

EXECUTION OF AGREEMENT (signing of agreement)

All Parties and Witnesses named in the Agreement must sign. Note, the Assignee (buyer) will hand over the purchase price either in exchange of bank draft or transfer which must be done simultaneously on the same day of signing of the documents

• Delivery of Possession or handing-over of the property to the buyer.

The Assignor will hand-over all the original documents to the Assignee upon confirmation of payment.

• In Lagos, for areas like Ikoyi, Apapa, festac Town & Environs, part of Victoria Island, Gowon Estate, Abesan Estate, Ojodu and other Federal lands in Lagos the usual documents are Federal or StateRegistered Conveyance before 1978 or Certificate of Occupancy after 1978 which is the same thing as Right of Occupancy.
• If there is an existing Certificate of Occupancy, the document you are going to receive after registration with the Federal or State Government on the signed Deed of Agreement is called Governor’s Consentfor State Land; and Minister of Works & Housing Consent for Federal Land which is also known as Certificate Of Occupancy.

IKEJA Property & other areas of Lagos state

All of the above are applicable for Ikeja as well. There is no Gazetted and Excision Land in Ikeja; it must be a Registered Conveyance, Certificate of Occupancy, Deed of Agreement and Purchase Receipt with other relevant documents.

LEKKI LAND or PROPERTY

The same requirements for Ikeja & other areas of Lagos also applicable. The only difference is that Lekki is the only place where you have Gazetted and Excision Lands.

Gazette: Meaning publication of land released to Customary Family Land Owners.

Excision: The titled document given to Customary land owners after released of their formerly acquired land by the Government.

Power of attorney: Is the legal power you give to somebody to act on your behalf in official capacity.

NOTE: A lawyer must be involved in all the transaction on the property to guide and protect you.

HOW TO LAWFULLY REGISTER YOUR LAND OR PROPERTY DOCUMENT

For Real estate law in Nigeria and Lagos in particular, in order to legally register your land or property as prescribed by law, the following processes and document are required to have a lawful land title in respect for the following documents:

• Certificate of Occupancy (+ Right of Occupancy)
• Deed Of Assignment (or Deed of Lease, Deed Of Sublease, or Deed of Mortgage)
• Gazette (with a Record of Excision)
• Governor’s Consent Document
• Power of Attorney

Required Documents to Process all the Above

If there is an existing Certificate of Occupancy, the document to be given to you after registration is called (Governor’s Consent). However, if there was no existing Certificate of Occupancy, you can apply for one.

The Following Documents Will Be Required to Register a New Purchased Land from Federal or State Governments

 

1. The Solicitor will officially apply for Governor’s Consent Registration
2. 4 copies of Assignor and Assignee signed Deed of Agreement of the purchased land.
3. 2 passport photographs of the Assignee
4. 4 copies of registered Survey Plan
5. Sketch map of the location, picture of the actual land site.
6. Current Tax Clearance of the Assignor
7. Tax Clearance of the Assignee and Assignors
8. Lagos State or Federal government statutory Charges and Fees
9. Professional Fee of the Attorney
10. Other Statutory Procedures

In conclusion, since there is no area of law practice in Nigeria that is frequently more litigated or involved disputes, and going by the recent research of cases in Courts relating to land or property around the country, and particularly in a place like commercial city of Lagos with 22 million population, therefore, it is legally advisable for clients to consult the best lawyers & leading law firms located in Lagos State, Nigeria for proper legal  guidance in order to avoid disputes in respect of purchase of land and Property in Nigeria.

In other words, it is pertinent that the client must have a perfect & lawful title to guarantee one’s peace of mind, good tenancy and secured real Estate Asset to raise loan for business or other clients best interest relating to real estate & properties in Nigeria.

For further information on  the best and choicest property, land, real estate law advice in Lagos, Nigeria generally on  all aspects of land, real estate and property matters in Lagos state, including professional help of very good & top best property, Real estate attorney, Land lawyers & Solicitors in Lekki properties, Victoria Island, Ikoyi, Lagos and Nigeria generally for major assistance on top & best real estate law services  in  Lagos, Nigeria. You can contact our law firm for more education on the issue and topic above.

Starting a business or company in Nigeria by law, including smooth and easy setup of a foreign owned company in Nigeria, the business owner must comply with corporate laws of the new jurisdiction to guarantee a hitch free start of the business in Nigeria.

It is therefore important for an individual or business entity to ask for legal advice from the best commercial lawyers in Nigeria; this would equally help in securing all statutory business permits and approvals required for the business operation & set up.

The compliance of the business owner with Nigeria regulations and corporate due diligence will provide practical solutions that will serve the immediate and long-term best interest of the foreign investors carried out by the retained business lawyer in Nigeria.

What is Limited Liability Company
The ideal enterprise for this type of intended business investment  should be limited liability company simply defined in law, also by British oxford dictionary as a ‘‘Private company whose owners are legally responsible for its debts only to the extent of the amount of the capital they invested’’ or as defined by Small Business Encyclopedia in the international business magazine  entrepreneur.com, Ask an Expert Session with Jason Feifer as ‘’ A form of business organisation with liability shield advantages of a corporation and the flexibility and tax pass-through advantages of Partnership’’. Equally established in the case of Salomon v A Salomon & Co Ltd 1897 AC 22 as a Company being a separate legal personality from the owners.

Before going into the procedures, we must note, that there are several laws of the Nigerian National Parliament stipulating the rules and regulations of business in Nigeria and others laws in respect of a fully owned foreign company with foreign shareholders; a good example of such laws are the Company & Allied Matters Act, Immigration Act, Foreign Exchange Laws, Capital Import Law Central Bank of Nigeria Act, NIPC Act and other laws not mentioned.

 

The following steps are the best ways to set up a new foreign owned business in Nigeria:

 

Procedure 1

1. The first law requirement the intending foreign business owner or organization must know is to contract a knowledgeable business lawyer to incorporate a Limited Liability Company which is simply defined as a (Registered Company).
2. Note, the required share capital for a foreign owned company is a minimum of 10,000,000 Share Capital and above because this is the minimum share capital that would be accepted by the Ministry of Interior and Nigeria Investment Promotion Commission for the purposes of securing Business Permits and Expatriate Quota approvals.

Note: You are not paying 10million naira for the registration; it is mere numbers showing the size of the company and also meaning in law that the liabilities of the company are limited to the share capital.

 

Required Information and Documents for a New Company Registration.

1. Proposed name of the company to be reserved at the Commission.
2. Share Capital of the Company.
3. Division of the Share Capital in percentage ratio.
4. Name of the Directors, minimum of 2 and maximum of 50 for a Private company including shareholding.
5. Nigeria office address.
6. Directors & shareholders residential addresses overseas.
7. Data page of shareholders and Directors international passport or Government issued means of Identification, or a valid Driver’s Licence.
8. Signing of all the incorporation documents by the directors and shareholders.

This could be transported to the Directors via international courier transport companies and returned to the lawyer in Nigeria for filing at the Commission.

Note: Electronic or digital signatures are not accepted by the commission.

Upon receipt of all the signed documents and other attached documents by the Solicitor, the application will be filed accordingly and the company registered certificate of incorporation could be ready for pick up within 14days except there are queries on the Application by the Commission.

Procedure 2

At this point, it will be very important for the foreign owned company to either secure a physical office or at least a contact office address in Nigeria because it will be needed for Business Permit & Expatriate quota approvals at the Ministry of Interior.

 

Required Government Approvals and Other Due Diligence after Incorporation

1. Tax Registration and Opening of Bank Account.

It is compulsory to obtain Tax Identification Number (TIN) from Federal Inland Revenue Service, also Value Added Tax Registration referred to as (VAT). The good news now is, Nigeria Corporate Commission in collaboration with the Federal Inland Revenue Service now automatically issues the Tax Numbers some few days after incorporation of a company.

1. Bank Account Opening.

With the TIN ready, the company can open a corporate account for Capital Importation for the kick-off of the business, they should also make sure they comply with requirements of laws as regards the importation of capital or funds into Nigeria as stipulated by the Central Bank of Nigeria Circulars and Regulations.

The next stage:

Application for Business Permit and Expatriate Quota including NIPC Registration

As part of the Federal Government new initiative on Ease of Doing Business in Nigeria. The commercial law firm handling the applications can now route the 3 applications for Business Permit, Expatriate Quota and NIPC registration of the foreign owned company through NIPC Desk office in the Ministry of Interior directly to the Minister through the Citizenship and Business Department.

 

 

Required Documents

1. Certificate Of Incorporation
2. Memorandum and Articles Of Association
3. Current Tax Clearance Certificate;
4. Evidence of Acquisition of Business/Factory Building;
5. Receipt to Operate in the Oil Industry i.e. DPR Permit (for Oil Service Companies)
6. Evidence of Capital Importation e.g. a Certificate of Capital Importation, if Available;
7. Partnership/Joint Venture Agreement, the Responsibility Structure;
8. Feasibility Study Report (for joint venture companies)
9. Evidence of Acquisition of Operating Equipment and Machinery, such as Equipment, Vehicles, Business Machines, etc
10. Project Implementation Programme
11. Profile of Expatriate Personnel Detailing their Qualifications and Experience, Positions to be held by them in the Company and the duration of each Quota Position.
12. For construction companies and Letter awarding construction contract.

If all the relevant documents and statutory fees are paid, the Approvals could be secured within 2 months except there are queries.

Residence Permit

This is the last stage of processes required for setting up of a business in Nigeria, it is mandatory for the Directors and Expatriates Employees including their family members to secure a Resident Permit to live and work in Nigeria. The application will be processed by the Controller General of Immigration Service and it would be issued under the authority of the Minister of Interior as provided for in the Immigration Act 2015 and Immigration Regulations 2017.

The usual practice is that the Nigeria Immigration Service will issue an employee of the foreign owned company a Resident Permit popularly called CERPAC card meaning (Combined Expatriate Resident Permit and Alien Card). Take note, this Resident Permit is valid for 2 years and renewable after expiration, and this is only possible after the oversea owned company must have obtained a Business Permit and Expatriate Quota Approvals. There is a Government specified amount of US dollar statutory fee to be paid for the CERPAC approval.

We must clarify that in some categories of business, the law requires peculiar approvals and licences for a foreign or overseas owned company to operate in some important sectors of the Nigerian Economy, a good example are oil and gas sector, communication, pharmaceuticals, banking & insurance, capital market which will be approved by other special Government regulated agencies.

 

Therefore, if you need to know more about easy and best ways to set up a foreign owned company in Nigeria, we always strive to work with business owners to determine the best choice of company to fit in into their business goals and needs in Nigeria.

We encourage prospective foreign business owners to invest in the country in view of her good laws, and great returns on investment in Africa as the economy power house.  Equally, as the high-quality commercial law firm of distinction in Nigeria, we assure you a hassle-free legal compliance of business with Nigeria regulation and due diligence.

We serve as best lawyers in Nigeria for consultation in commercial law, we are more than ready to assist and help to make all the business regulation requirements a seamless one in Nigeria!