Overview
FREE TRADE ZONES (FTZ)
The Nigerian Export Processing Zones Act of 1992 outlines the legal framework for investment in Nigeria’s Export Processing or Free Trade Zones. The Act established the Nigerian Export Processing Zones Authority [NEPZA] to administer and manage all free trade zones in the country. Zones may be managed by public or private entities or a combination of both under the supervision of NEPZA.
Approved Free Zone activities include:
- Manufacturing of goods for export
- Warehousing freight forwarding and customs clearance.
- Handling of duty-free goods
- Banking, stock exchange, insurance, and other financial services
- Import goods for special services, exhibitions, and publicity.
- International commercial arbitration services and other activities deemed appropriate by NEPZA.
- A minimum investment of US$500,000 is required by approved enterprises to undertake these activities in the Free Zones.
Approved Free Zone enterprises can take advantage of the following incentives:
- Up to 100% foreign ownership of businesses
- Exemptions from all federal, state, and local government taxes, levies, and rates.
- Duty-free import of capital equipment, machinery, raw materials components, and spare parts.
- Freedom from legislative provisions pertaining to taxes, levies, duties, and foreign exchange regulations.
- Repatriation of foreign capital investment at any time with capital appreciation of the investment.
- Unrestricted remittance of profits and dividends earned by foreign investors.
- No import or export licenses are required in the zone.
- Rent free land at the construction stage, thereafter, rent shall be set by the Investment Management Authority.
- Liberalized regime for employment of expatriates.
FREE TRADE ZONE IN YOBE
The present Administration has been working assiduously since its assumption of office to secure approval and licenses from the relevant authorities, the Nigerian Export Processing Zones Authority (NEPZA) to operate a Free Trade Zone in the State. The signing of relevant documents has already been completed, and the application awaiting ratification. The process shall be completed in no distant time from now and operational would commence immediately.
INVESTMENT PROCEDURES IN FREE TRADE ZONES
How to apply
- Request for an application form for setting up an Enterprise from the Zone Administration from any of the Free Zones in the country upon payment of $500 [Five Hundred US Dollars] or the Naira equivalent.
- Fill out the form and submit it to the administration attached with a feasibility study of the enterprise to be set up.
- The Authority will study the application and issue a provisional approval within 7 days of submitting the application.
- The free zone will discuss your site with you and allocate a plot of land to you.
- After approval, the minister shall be required to obtain the operating license, which will be renewable each year upon payment of the whole amount of the rental fee.
- Remit your investment capital through local banks located in the zone which will in turn issue a certificate of capital importation or any bank of your choice.
- Move in and operate.
Why You Show invest in Nigerian Free Trade Zone
- Access to a large Nigerian Market estimated at about 200 million people.
- Nigeria’s membership of the Economic Community of West African States [ECOWAS] provides access to the West African markets.
- Political and social stability, favorable business environment, and strong support by the Government to provide sector initiative through the government economic reform agenda that is private sector driven.
BENEFITS
- SWIFT investment approval process.
- Availability of highly skilled and favorable labor force at competitive wage rates.
- Membership of the ACP Lome convention guarantees the country’s product preferential access to the access of a wide range of Nigerian products in the US market.
- African Growth and Opportunity Act (AGOA) also provides preferential access to a wide range of Nigerian Products to the US market.
- Abundant raw materials.
Tax Incentives
Investors within the zone will be exempted from income, capital gains, value-added or sales taxes, and from all Federal, State, and Local Government taxes and levies. Customs Incentives
- Duty-free import of raw materials and components.
- Duty-free import of equipment, machinery, and spare parts.
- Suspended duty on trade articles.
- On-site custom processing.
- No import or export licenses are required.
Immigration Incentives:
- No restriction on the number of expatriate employees.
- On-site processing of the immigration documents including combined expatriate resident permit and aliens’ card.
Guarantee and Privileges:
- Repatriation of foreign capital investment with capital appreciation at any time
- Remittance of profits and dividends earned.
- Sale of up to 100% of production in the Nigerian custom territory on payment of appropriate duties.
- Rest-free land during construction.
- Up to 100% foreign ownership of businesses allowable.
- Prohibition of strikes and lockout.
- On-site vehicle licensing.
- Cheap cost of land lease.
ELIGIBLE FIELDS OF INVESTMENT
- Electrical and Electronics products
- Textile products
- Garments
- Wood products and handcraft
- Leather products
- Rubber and plastic products
- Cosmetics and other chemical products
- Metal products and machinery
- Educational materials and sports equipment.
- Printing materials.
- Commercial and office equipment.
- Medical Kit, Optical Instruments, and Appliances.
- Biscuits, Confectionaries, and other food processing
- Pharmaceutical product.
- Warehousing, banking, Insurance, and other Financial Services, etc.
Other activities not listed above but deemed appropriate by NEPZA.