Many businesses fail due to oversight on the part of the owners to get informed and put the right safeguards, thereby leading to the failure of the business. It is one thing to register a company, and it is another to maintain a company and ensures its compliance with the rules of regulatory authorities. The requirements elucidated below would help you to take the right steps before registering your company.
1. NAMEThe name of a company represents the public image of the company, which can make or limit your business in the long run. Be careful not choose names that would limit the objectives of your business. Also ensure that the name has not been trade-marked by someone else before registering it, to avoid unnecessary lawsuits and financial implications in the future.
2. DETERMINE THE LEGAL STRUCTURE OF YOUR BUSINESSIn Nigeria we have three classes of businesses as follows; Business name (which includes partnership and Sole proprietorships), Limited liability (which includes PLC and Unlimited liability companies), and Incorporated Trustees (which includes associations, cooperative, Non Governmental Organizations, and societies). The choice of legal structure would determine how much protection from personal liability you will get. You may require the services of a lawyer and an accountant to advise you on the appropriate legal structure based on the objectives of the company.
3. PARTNERSHIPBefore registering a business that involves partners, it is always advisable to have a lawyer draft a partnership agreement which would state the obligations, sharing formula of profits e.t.c of all partners in the business. Never partner with anyone or company because of convenience, but partner with someone who would contribute actively and positively to the success of your business.
4. INSURANCEEvery business is a risk and risks can be insured to ensure that your business does not suffer. Many business owners have lost millions through insurable risks such as fire, death, and accidents due to ignorance. As a business owner, identify those risks that your business may be prone to. Also some regulations specifically state the type or areas of a business that must be insured. For instance, Employee Compensation Act 2011 provides that every establishment with more than 10 employees must take out Employer’s liability insurance on its employees.
5. REGULATORY AGENCIESMany business owners register businesses without a proper study or research on the regulatory agencies that regulate the type of business they are into. For instance, obtaining your Tax Identification Number (TIN), Acquiring the necessary information helps your business stay afloat, be a law abiding corporate citizen, labour/employment laws, budgeting, and obtaining licences.
Putting into consideration the requirements explained above will enable you to have a hitch-free business registration thereby saving you from future issues that may arise due to ignorance.
LawStrive is an on-demand lawyer hiring platform that also provides opportunities for citizens to get free advice and education on legal related matters. Ask your questions from lawyers today, Register with us.