Start an NGO
HOW TO START AN NGO: REGISTERING A FOUNDATION IN NIGERIA
A Non-Governmental Organization (“NGO”) is a body or association of persons registered as “Incorporated Trustees” under Section 590 of the Companies and Allied Matters Act, Cap C20 Laws of the Federation of Nigeria 2010 for the advancement of any religious, educational, literary, scientific, social/cultural development, sporting and charitable causes. An NGO is deemed a not-for-profit organization in Nigeria. The following is a guide on how to start an NGO or registering a Foundation in Nigeria.
1. Devise a plan. To start an NGO, you need to devise a plan, write about your organization’s beliefs, mission, and purpose. As you define your mission and draft you purpose statement, you should describe the overall purpose of the NGO; the activities your NGO will engage in or undertake; its core beliefs; etc.
2. Select a name for your Foundation. Depending on the goals of your NGO, the following are examples of names you may choose: “Youths for Democratic Governance”, “Brilliant Minds Educational Foundation”, “Network of Women in Politics”, “Mega Champions Football Club”, “Jesus Christ Outreach Ministries”, “Money-Givers Trust Foundation”, “Amalgamated Union of Market Traders”, “The CEOs Roundtable”, “All United Sport Club”, “Foundation for Human Rights”, “Roundtable for Environment Conservation”, “The Motor-Sport Club of Nigeria”, “The Mental Health Foundation”, Good Governance Advocacy Foundation”, “Emerging Tigers Union”, “Love and Care Foundation”, “Association of Artisans and Miners”, “Climate-Change Foundation”, etc. (plus an alternate name in case the first is not available for reservation).
3. Appoint the Trustee(s). A person qualified to be appointed a Trustee must not be less than 18 years of age; or of unsound mind; or undischarged bankrupt; or convicted of an offense involving fraud or dishonesty within 5 years of his proposed appointment.
4. Consult an Accredited Solicitor. To start an NGO, you need to consult a solicitor who has been duly accredited by the Corporate Affairs Commission (CAC) to conduct pre and post incorporation matters with the Commission to help you execute the following:
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Name Availability Search and Reservation. Your Solicitor will conduct a search at the Corporate Affairs Commission (CAC) registry to check if the NGO name you have chosen is available for reservation. Only a name that is not identical to an existing registered organization in Nigeria can be reserved for you. Where your name is available, same will be approved for registration. Name availability check and reservation can be effected within 48 hours by a CAC accredited Solicitor.
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Publication of Notices. Your Solicitor, in compliance with the law, will publish in three (3) national dailies, one being a local newspaper widely circulated in the area where your NGO is based on a notification of intention to register the NGO, setting out the name of the NGO; the names of trustees, aims and objectives; and a call for objections within 28 days to the registration of the NGO (if any)
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Drafting of the NGO Constitution. The NGO’s constitution drafted by the Solicitor will set out rules that would govern the internal affairs of the NGO, the aims, and objectives of the NGO, the governance structure, names of members of the Board of Trustees, the statement of purpose, etc.
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Drafting of the Minutes of the Meeting. Your solicitor will draft the minute of meeting that will provide details whereat members of the Board of Trustees were appointed, list of members present and absent, the voting pattern, and the authorization to apply for registration, signed by Chairman and Secretary of the Board.
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Drafting of the Minutes of the Meeting. Your solicitor will draft the minutes of meeting whereat the special clause was adopted into the constitution of the organization; signed by Chairman and Secretary of the Board.
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Documentation of all incorporation documents. Your solicitor will put together all incorporation documents including duly completed application form in triplicate, letter of application, the original of newspaper publications, copies of the NGO constitution so drafted, the above minutes of the meetings, passport-sized photographs of the Trustees, the impression of the common seal of the NGO, etc.
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Submission and Filing. Your solicitor will file all the relevant documents with the Corporate Affairs Commission for the incorporation of the NGO.
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Collection of the NGO Certificate of Incorporation. The Certificate of Incorporation of the NGO will be issued by the Corporate Affairs Commission to you through your CAC Accredited Solicitor after due documentation and filings.
Open a Bank Account in the NGO Name. This is very important because opening a bank account in the NGO’s name shows the NGO is official and you are ready to receive financial support and donations from the public. To open a bank account, you will need the Certificate of Incorporation of the NGO issued by the Corporate Affairs Commission.
THE INCIDENCE AND BENEFITS OF REGISTERING AN NGO
The following are the benefits and incidence of registering a Foundation/NGO.
1. Right to Acquire Assets. When your organization is formally registered with the Corporate Affairs Commission by way of incorporation, it then becomes entitled to acquire land, own fixed assets and/or incur liabilities under its common seal. It is illegal for an unregistered organization to buy, hold or sell land anywhere in Nigeria.
2. Protection from Personal Liability. You can buy, acquire and register stakes and assets in the name of your NGO. This is a very smart way of protecting yourself from unlimited liability for untoward happening such as bankruptcy, foreclosure, judgment debt, or divorce etc. Assets and property registered in the name of your NGO can never be targeted or attached for the satisfaction of any unsettled debts, nor can it be used for court settlement in a divorce proceeding. You are better off outsmarting an ugly situation in future than be sorry!
3. Corporate Entity. As a corporate body, your organization’s dealings and engagements with the public will improve. The NGO can sue to enforce its legal rights or be sued through its registered trustees.
4. Structured Financial Plan. Having an NGO can afford a tax-free mechanism for activities you are carrying-on under the NGO. NGOs are deemed not-for-profit and tax exempted. You can develop a structured financial plan that allows the organization to do business devoid of tax liabilities. This is called “tax avoidance”. Tax avoidance is a legitimate way of reducing or eliminating your tax obligation. Tax avoidance is not “tax evasion” which is illegal!
5. Stability. The registration of your organization can suggest that there is effective and responsible leadership in place. The public will perceive same as being stable than an unregistered organization. Political parties, government, donor agencies, financial institutions, charity organizations and other NGOs will want to partner with a registered body to further common objectives.
6. Perpetual Succession. This means an NGO got an unlimited lifespan and will continue to exist even if the founder or trustees die or leave the NGO. The organization’s existence will only cease if it is formally wound up by the Order of Court. Amongst other benefits, this may allow perpetual succession.
7. Access to Credit. Registering an NGO can afford access to credit from lenders and financial institutions. You can use a loan facility to promote the organization’s activities, finance a mortgage, acquire land or fixed assets. Banks will want to see proof of registration with the CAC as condition precedent to giving a loan.
8. Name Preservation. Once your organization is registered, no one can use the same name or name similar to it throughout Nigeria. This has the benefit of protecting your corporate image and name from unauthorized use.
9. Banking. Opening a corporate account with a bank for the NGO may signal the fact that you are transparent. Some private persons, government, donor agencies and other NGOs will not be comfortable writing you a cheque for your organization in your personal name. A bank account for the NGO would signal its corporate existence and its readiness to receive donations. You need to provide proof that your organization is registered with the Corporate Affairs Commission to be able to open an account with a bank.
NEXT STEP?
If you want to start an NGO, you are taking the right step in the right direction. Registering an NGO would confer numerous benefits for the growth and sustainability of whatever you do. It is recommended that you obtain guidance from an accredited solicitor of the CAC for pre and post incorporation matters of the NGO, and to pin down key issues relating to the governance structure of same.