Nigeria’s general investment posture is open — the Nigerian Investment Promotion Commission Act permits up to 100% foreign ownership in most sectors. The exceptions are precisely where deals go wrong, usually because they are identified after the transaction structure, not before it.
Where the caps actually bite
Broadcasting, certain upstream oil and gas activities, and select telecoms licences all carry local-content or ownership requirements that are easy to miss when a deal team assumes the general open-door policy applies uniformly across sectors.
A sector-cap issue discovered during due diligence is a delay. The same issue discovered after signing is a renegotiation.
Structuring around the restriction
Where a genuine cap applies, the answer is rarely to abandon the transaction — it is to structure the local shareholding, voting arrangements and economic interest correctly from the start, so the foreign investor retains genuine control of the commercial upside within the regulatory limit.
Diligence before term sheet
The sector-cap question belongs in the earliest phase of diligence, before the term sheet is signed — not as a closing condition discovered by the lawyers weeks before completion.
This note is general commentary on Nigerian legal practice and does not constitute legal advice or create a lawyer–client relationship. Outcomes depend on the specific facts and the applicable law at the time. For advice on a particular matter, speak with the firm.
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