THE 2 LEGAL WAYS OF DOING BUSINESS

THE 2 LEGAL WAY OF DOING BUSINESS
Last Week, we suspended the Mini-Law-Series to enable us sensitize the populace on the directive of the Corporate Affairs Commission (CAC). The said directive is to the effect that Business Names and Companies who have defaulted in the payment of their Annual Returns will have their names struck OUT of the CAC’s ‘Portal’
Treading the path set by the Corporate Affairs Commission, the Mini-Law-Series brings you the feature  tagged: THE LEGAL WAY OF DOING BUSINESS
Let’s get to it!
Generally speaking, business (with the sole aim of making profit) can be carried out under 2 heads, the first is as an Enterprise while the second is as a Company. The nature of the business amongst other significant issues will determine the appropriate direction to follow; be it the Enterprise or the Company. We are not unaware of the murmurings from different quarters that the call for registration of Business Name or Incorporation of Company is an attempt to generate more revenue into the coffers of the Federal Government while providing ‘meal tickets’ for the Legal Practitioner. We hope that at the end of this feature, there will be a shift of mindset.
For ease of understanding, our discourse today will be centered around Business Name solely. Entrepreneurs, Business Owners, Vendors, Professionals, Stay with us!
A Business Name is an appropriate legal structure where the business is a “one man business” or better said, when the business is run solely by an individual. The said individual thus remains the Alpha and Omega of the business. There are benefits attached to the Registration of a Business Name, we have highlighted some of these benefits below:
BENEFIT OF REGISTERING A BUSINESS NAME
Protection of your chosen Business Name: Your chosen business name is your business identity and ought to be peculiar to your business and brand. If you are doing business with the name Social Media Enterprise, without the appropriate registration with the Corporate Affairs Commission, any other person can equally do business with the same name Social Media Enterprise. This is the juice, where the second person registers such a name as Social Media Enterprise before you (the original creator), the name will no longer be available for your use. Another example will do justice to the point I am struggling to make, Miss. Beauty is the Managing Director of a Beauty Studio which she named Beautiful Palace, she carries on the business of Make Up and the likes, she has been running the Beauty Studio for the past 6 years without registering with the Corporate Affairs Commission. Miss Hot Leg, fresh from the University also decided to open a Beauty Studio which caters for the beauty needs of women, in the course of her brainstorming session she elected to use the name Beautiful Palace and thereafter proceeded to register it at the Corporate Affairs Commission. Miss Beauty thereafter secured a contract which requires her to open an Account, in fact a cheque had been issued in the name of Beauty Palace. At the point of commencing the opening of Account procedure with a Commercial Bank with the name of her business, the Bank requested for evidence of Registration. In the course of trying to register her Business Name with the CAC, she was notified that the name was no longer available, she had to settle for a new name with it’s attendant effect such as printing of a new business card, repainting of her beauty studio to erase the name ‘Beautiful Palace’ as well as changing her user name on all Social Media Platforms.

Attract Investors: I hope you know that no sensible, rational thinking business man and/or woman wants to do business with a Business Entity that is not registered with the Corporate Affairs Commission. Registration of a Business Name is a form of guarantee to potential investors that your business is genuine and it is not a means to defraud them; this is because in the course of Registration, certain information such as Name, Place of Business, Nature of Business amongst others would have been obtained at the Corporate Affairs Commission and maintained on her portal. As a matter of fact, a search can be conducted using the name of the Registered Business and all the information a potential investor requires to do business with you becomes accessible. What a relief!


Opportunity of obtaining Funds and Grants: Am sure every budding entrepreneur is aware that there are funds accessible for certain sector of the economy and the first prerequisite to accessing these funds, is registration with the Corporate Affairs Commission. Worthy of mention is the Tony Elumelu Entrepreneurship Program, Africa Women’s Development Fund, the Dangote Foundation which caters to those in the Manufacturing and/or Agro Processing units amongst other units.

Ability to open and operate an Account in the name of your business: Yay! I do not mean your regular savings and/or current Account held in your personal name, I mean the name of your Business, so in my example above, Miss Hot Leg apart from having and operating an Account with a Commercial Bank in her name i.e. Miss Hot Leg, she can also elect to open and operate an Account using the name Beauty Palace, the implication is that her clients can pay directly into her business account, she can with ease deposit cheques issued, into the business account. Of course, we all know that some firms and organization will not issue a cheque in the name of a vendor rather such cheques will be issued in the name of the business itself for accountability sake. This takes me to the next benefit.


Eligible to Apply for Loan and Federal Government Small Business Incentive: Let me burst your bubble once again, where a Business Account is opened with a Commercial Bank and all cash flow comes in through the Account, it’s easier to approach the bank for a loan. However, Please let a lawyer vet the offer letter and all other documents issued by the Bank in the course of applying and obtaining a loan. Equally, there are some incentives of the Federal Government made available to Micro, Small and Medium Enterprises; Registration of Business Name with the CAC is usually the first hurdle to cross in accessing these incentives.

Ease of Procuring Visa to any Country for Business Purpose: The key word herein is for ‘business purpose’, so when you have plans of travelling for a conference, seminar or to execute a project outside Nigeria, your Certificate of Registration makes it easier to obtain a Visa, this DOES NOT OBVIATE the completeness of all other relevant documents.


You get to flaunt your Certificate of Registration on Social Media and get more clients in the process: What a great marketing strategy!

Do you need help Registering your Business Name, or Incorporating a Company? Ohk! Have you Registered your Business Name or Incorporated your Company? Are you in need of Corporate Advisory? Please reach out to the Online Law Clinic Team on WhatsApp: 08090956207 OR onlinelawclinicteam@gmail.com



Thank you.
Oluwatosin Ajose Popoola Esq.,
For: The Online Law Clinic
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