Investor Presentaiton

7.4 The Country and its institutions Business Organisation Labour and Social and Regulation Security Regulations The Nigerian Financial Services Industry Tax System Foreign Exchange Transactions Investment in Nigeria Accounting and Auditing Requirements Importation of Goods Exportation of Goods Investment Incentives COVID-19- Economic and Fiscal Measures remittance of dividends and interest by guaranteeing to foreigners the unrestricted transferability of dividends or profits (net of taxes) attributable to foreign investment in Nigeria, and capital repatriation in the event of liquidation. In effect, prior ministerial approval of such transactions is no longer required. All that a foreign investor needs to do is to instruct an authorised dealer in foreign exchange to transfer the related funds in a defined currency on submission of the prescribed documents; and procurement and repayment of foreign loans and interest thereon by Nigerian companies without prior ministerial approval. The requirement for registration of foreign enterprises in Nigeria by the NIPC should normally dispense with the requirement for business permit from the FMI. However, in view of the provisions of the Immigration Act and Immigration Regulations, FMI still requires foreign investors to obtain business permit 55 as a pre-condition for obtaining expatriate quota approval. Federal Competition and Consumer Protection Act, 201856 The Federal Competition and Consumer Protection Act ("FCCPA") was enacted by the National Assembly in December 2018, and subsequently signed into law by President Muhammadu Buhari in January 2019. The FCCPA repealed the Consumer Protection Act, dissolved the Consumer Protection Council, and established the Federal Competition and Consumer Protection Commission in its stead. Some highlights of the FCCPA include the following: . Establishment of the Federal Competition and Consumer Protection Tribunal Annulment of restrictive agreements • Price regulations • Prohibition of abuse of dominant position Regulation of mergers • Prohibition of monopolies Oversight of regulated industries The FCCPA also stipulates stiff penalties against competition such as price-fixing, conspiracy, bid-rigging, obstruction of investigation or inquiry, offences against records, giving of false or misleading information, etc. 7.5 The various investment incentives in Nigeria are as follows: 7.5.1 Pioneer Status Pioneer status is granted only upon application to the NIPC, to eligible companies operating in industries or producing products or services categorised as pioneer industries and products or services. 57 The incentive is granted by NIPC as part of its investment promotion mandate. After NIPC has granted the approval-in-principle, the Industrial Inspectorate Department (IID) of the Federal Ministry of Industry, Trade and Investment will, on application by the beneficiary, inspect its operations and certify its commercial production date for the purpose of commencement of the incentive. The NIPC will issue the pioneer status certificate and publish the grant of the incentive in the Gazette after the IID has issued the production day certificate. Some of the benefits available to companies enjoying pioneer status are as follows: (i) the profits derived by the pioneer company from its pioneer products are exempted from Companies Income Tax (CIT); (ii) capital expenditure on qualifying assets incurred during the tax relief period and available for use after the period, is treated as having been incurred on the first day following the tax relief period. Pioneer companies are therefore able to fully claim capital allowances on such assets; (iii) dividends paid out of pioneer profits are not taxable in the hands of the shareholders of the company; and (iv) losses incurred during the tax relief period is deemed to be incurred on the first day following the tax relief period and can be set off against the assessable profits of the company in subsequent tax years. 55 Required for both wholly foreign owned and joint venture entities 56 https://assets.kpmg/content/dam/kpmg/ng/pdf/tax/ng-Federal-Competition-and-Consumer-Protection-Act.pdf 67 Investment in Nigeria Guide - 8th Edition 57 See Appendix 2 for the current list of pioneer industries and products/services. The list includes the 27 pioneer industries recently ap- proved by the Federal Government. KPMG

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