Pioneer Status Incentive Regulations 2014
What investors need to know
Over the years, there have been contentious issues relating to the qualification and application for pioneer status incentives for investors in Nigeria.
The Chairman Governing Council of Nigerian Investment Promotion Commission (NIPC), Hon Isa Ibrahim Bio, in January 2014, approved the release of the Pioneer Status Incentive Regulations, 2014 (“The Regulations”). This is in exercise of the powers conferred on the council by S. 30 of the Nigerian Investment Promotion Commission Act (CAP N117 LFN 2004). The Regulations have an effective date of 30 January, 2014.
The Regulations seek to provide policy clarification, consistency and transparency in applying for pioneer status.
Highlights of the Regulation
- Pioneer status incentive application form now free
- Applicants must have incurred a capital expenditure of not less than ten million Naira (N10,000,000)
- Application to be made within one year of commencement of commercial production
- Applicants are to pay 2% service charge based on estimated tax savings; other criteria to be used in the event of estimated losses.
- Non – refundable processing fee of two hundred thousand Naira (N200,000)
- Pioneer status can now be suspended in certain circumstances
With the release of the Regulations, it is expected that there would be more clarity in the procedures for application for pioneer status by companies and their advisors.