If you’re planning to start a business in Nigeria, understanding the types of companies you can register with the Corporate Affairs Commission (CAC) is one of the most important steps.
Under the Companies and Allied Matters Act (CAMA) 2020, Nigeria recognizes various company structures designed to suit different business goals, from small startups to large corporations and nonprofits.
Company Registration Services in Nigeria
Different Types of Companies You Can Register with the Corporate Affairs Commission (CAC) in Nigeria in 2025
In this comprehensive guide, we'll explore the major types of companies recognized by the CAC, their key features, benefits, and how to select the right one for your goals. Whether you're a solo entrepreneur, a non-profit founder, or aiming for public investment, this article covers everything you need to know about company registration in Nigeria.
What Defines a Company Under Nigerian Law?
A registered company is a legal entity distinct from its owners (members/shareholders). This separation grants it the rights of a natural person: it can own assets, enter contracts, and sue or be sued without directly involving the personal wealth of its directors or members.
Unlike a sole trader or unregistered partnership, liability for members in most registered companies is limited, offering essential personal asset protection.
Categorizing the Main Types of Companies to Register in Nigeria
Companies in Nigeria are classified based on several criteria, including liability, number of members, domicile, and other miscellaneous factors.
Below is a breakdown of each category and what it means under Nigerian company law.
Based on Liability
- Company Limited by Shares: Shareholders’ liability is limited to the unpaid portion of their shares. This is the most common type, suitable for profit-oriented businesses.
- Unlimited Company: Shareholders have unlimited liability and risk personal assets beyond their share capital. This type is rarely used due to its high risk.
- Company Limited by Guarantee: Typically used by non-profit organizations, NGOs, and charities. Members guarantee a nominal amount toward debts in the event of liquidation.
Based on the Number of Members
- Private Company: Ownership is limited to a maximum of 50 shareholders, and shares cannot be offered to the public.
- Public Company: Ownership is open to the public, shares are traded on the stock exchange, and there is no limit to the number of shareholders.
Based on Domicile
- Local Company: Incorporated in Nigeria and operates primarily within the country.
- Foreign Company: Incorporated outside Nigeria but carrying out business within Nigeria through a branch or subsidiary.
Miscellaneous Company Types
- Subsidiary and Holding Company: A parent (holding) company controls one or more subsidiaries through majority ownership or management control.
- One-Man Company: A company with a single shareholder who meets regulatory requirements and may appoint nominee members.
- Partnership: Formed by two or more partners sharing profits and liabilities, regulated under the Partnership Act.
- Co-operative Society: Member-based association established to promote mutual economic benefits rather than profit.
- Joint Venture Company: A temporary or project-based collaboration between entities for a specific business purpose without creating a new legal entity.
The Primary Types of Companies to Register in Nigeria
Here’s a detailed breakdown of the different company types you can register in Nigeria in 2025.
1. Private Company Limited by Shares (LTD)
This is the most popular and versatile company structure in Nigeria, suitable for startups, SMEs, and family businesses. It offers limited liability and allows flexible management.
Key Features
- Ownership: 1 to 50 shareholders.
- Liability: Protected, limited to the unpaid shares of members.
- Share Capital: Minimum of ₦100,000.
- Management: Can operate with just one director and shareholder; AGM is optional for small companies.
- Best For: Startups, SMEs, and businesses seeking asset protection and operational flexibility.
2. Private Unlimited Company (ULTD)
This structure provides no limit to shareholders' liability, meaning members are personally responsible for all debts. Suitable where confidentiality outweighs personal liability concerns, often in high-trust family businesses.
Key Features
- Liability: Unlimited liability.
- Ownership: No restrictions on the number of members.
- Use Case: Niche businesses where confidentiality is paramount, and members trust each other completely.
- Risks: High personal risk; less common and usually used in specialized, high-trust environments.
3. Private Company Limited by Guarantee (LTD/GTE)
Ideal for non-profits, NGOs, charities, and religious organizations focused on social missions rather than profits. It provides a solid legal structure for charitable organizations to operate transparently and securely.
Key Features
- Purpose: Non-profit; all income is reinvested into the organization.
- Members: Guarantee a fixed amount upon winding up.
- Registration: Requires approval from the Attorney General.
- Liability: Limited to the guarantee amount.
- Best For: NGOs, foundations, religious bodies, and social enterprises.
4. Public Company Limited by Shares (PLC)
Designed for large enterprises seeking to raise capital by offering shares to the public on the Nigerian Stock Exchange (NGX). Offers significant growth potential via public funding and stock trading, ideal for ambitious, large-scale businesses.
Key Features
- Ownership: Unlimited shareholders; no cap.
- Share Capital: Minimum of ₦2 million.
- Regulatory Oversight: Strict supervision from SEC, CAC, and NGX.
- Management: At least two directors and a company secretary.
- Best For: Large corporations like banks, insurance companies, and telecom firms.
5. Public Unlimited Company
Similar to a PLC but with unlimited liability, exposing shareholders to higher personal risk.
Key Features
- Liability: Unlimited.
- Share Trading: Permitted, but high risk.
- Best For: High-risk ventures with public share trading, though rarely chosen due to risk.
6. Public Company Limited by Guarantee
Usually for NGOs and charitable organizations seeking to operate openly with public accountability.
Key Features
- Liability: Limited to members’ guarantee.
- Profit Distribution: Cannot distribute profits.
- Use Case: Charitable organizations aiming for transparency.
7. Limited Liability Partnership (LLP)
A hybrid structure providing limited liability to partners, suitable for professional service firms.
Key Features
- Ownership: Partners share management.
- Liability: Limited to each partner’s investment.
- Best For: Law firms, accounting, consultancy firms, and professional partnerships.
8. Foreign Company Registration
International companies seeking to establish a presence in Nigeria are required to register their subsidiaries or branches with CAC.
Requirements
- Register with CAC and NIPC.
- Minimum share capital of ₦100 million.
9. Subsidiary and Holding Companies
Holding Company
- Owns controlling interest (>50%) in subsidiaries.
- Main function: manage and control subsidiaries, asset protection, and tax efficiency.
- Registration: Special consent required; must have at least two subsidiaries.
Subsidiary Company
- Operates as a separate legal business under a parent (holding) company.
- Manages its own operations but is controlled by the parent company.
- Ideal For: Large business groups seeking risk separation and management.
10. Special Company Types
Co-operative Societies
- Member-driven business associations focused on mutual economic support.
- Not profit-making but aimed at social benefits.
Joint Venture Companies
- Formed between two or more entities for shared projects without forming a new legal entity.
Comparison Table: Private vs Public Company in Nigeria
Here's a side-by-side comparison to highlight differences:
| Feature | Private Company (LTD) | Public Company (PLC) |
|---|---|---|
| Number of Shareholders | 1–50 | Unlimited |
| Liability | Limited (by shares or guaranty) or Unlimited | Limited (by shares) or Unlimited |
| Minimum Share Capital | ₦100,000 | ₦2,000,000 |
| Share Trading | Restricted - shares cannot be offered to the public | Freely tradable - shares can be offered to the public |
| Annual General Meeting (AGM) | Optional for small companies | Mandatory |
| Corporate Secretary | Optional for small companies | Mandatory |
| Ownership Control | Greater control - closely held by founders | Dispersed among public shareholders |
| Regulation & Reporting | Fewer reporting and disclosure requirements | Highly regulated - SEC, NGX, and CAC oversight |
| Disclosure Level | Private | Public and transparent |
| Name Suffix | “Limited” or “LTD” | “Public Limited Company” or “PLC” |
| Listing & Trading | Not listed on the stock exchange | Listed and tradable on the Nigerian Exchange (NGX) |
| Funding Source | Private equity, shareholder funds, and loans | Public shares, loans, and institutional investors |
| Regulatory Load | Low - suitable for SMEs and startups | High - suitable for large corporations |
| Asset Protection | High - limited liability protects personal assets | High - limited liability applies |
| Ideal For | Small and medium-sized enterprises (SMEs), startups, and family-owned businesses | Large corporations, conglomerates, and investors seeking public funding |
How to Choose the Right CAC Company Type for Your Business Goals in Nigeria
Consider these 10 key factors concisely to guide your decision:
- Nature of Business: Certain industries like banking, insurance, aviation, and telecommunications must register as public companies due to regulatory complexity. Smaller or less regulated sectors often form private limited companies or other structures.
- Liability: Private Limited Companies (Ltd) and Public Limited Companies (Plc) provide limited personal liability, protecting personal assets if the business incurs debts.
Unlimited companies offer no personal asset protection and pose higher financial risks. Companies Limited by Guarantee (Ltd/Gte) suit nonprofits with limited liability to members’ guarantees. - Share Capital: If you need to raise capital, Pvt Ltd and Plc can issue shares to investors. Plc can sell shares publicly on the stock exchange, facilitating large-scale fundraising. Ltd/Gte relies mainly on member contributions and grants, limiting capital options.
- Number of Members: Private Ltd caps membership at 50, allowing close control. Public Plc and Ltd/Gte have no upper membership limit, ideal for expansive operations.
- Accountability: Public companies require strict transparency, detailed financial reporting, and annual general meetings, which may suit businesses accustomed to regulatory oversight. Private Ltd and Ltd/Gte offer more privacy and simpler reporting.
- Purpose: Profit-focused ventures typically choose Private Ltd or Public Plc. Nonprofits and social enterprises opt for Companies Limited by Guarantee (Ltd/Gte).
- Management: A Private Ltd allows for sole management with a single director, ideal for startups or small businesses. Other entities require at least two directors, suiting larger and more structured setups.
- Funding Sources: Ltd and Plc companies raise funds via shares, bank loans, and capital markets. Ltd/Gte companies are limited to member contributions, donations, and grants.
- Taxation: Profit-making Private Ltd and Public Plc companies are subject to tax obligations. Ltd/Gte entities are tax-exempt given their nonprofit nature.
- Regulatory Requirements & Growth Potential: Public Plc faces the highest regulatory demands but offers greater growth potential due to access to capital markets and larger memberships.
Private Ltd companies balance ease of management with scalability, while Ltd/Gte companies prioritize mission over growth.
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Kickstart your corporate journey with a company incorporated through the Corporate Affairs Commission (CAC).
Private Limited Company (LTD) IncorporationPerfect for SMEs seeking legal structure, liability protection, and operational flexibility.
Guarantee Company (LTD/GTE) IncorporationFor non-profit initiatives, professional bodies, and charitable organizations needing corporate status.
Public Limited Company (PLC) IncorporationIdeal for large enterprises planning to raise capital from the public through share offerings.
Unlimited Company IncorporationRecommended for professionals and investment groups desiring complete operational privacy.
