Nigeria’s Free Trade Zones (FTZs)
Free Trade Zones (FTZs) in Nigeria are specially designated areas offering unique regulatory frameworks and economic incentives to stimulate industrialization, attract foreign investment, and boost international trade.
Legal and Regulatory Framework
Nigeria Export Processing Zones Act (NEPZA) – 1992
This Act established the Nigerian Export Processing Zones Authority (NEPZA), tasked with licensing, regulating, and managing FTZs in Nigeria. It lays out the legal incentives and operational rules for investors.
Oil and Gas Export Free Zone Act (OGEFZ) – 1996
This Act created the OGEFZA to oversee oil and gas-specific free zones. It defines legal and fiscal benefits tailored to energy-sector players operating within designated zones.
Supporting Regulations
These include the Investment Procedures and Operational Guidelines for Free Zones (2004), and recent directives such as the 2018 Lagos Industrial Zone Regulations—establishing compliance protocols for FTZ activities.
Categories of Free Trade Zones
Export Processing Zones (EPZs)
These zones prioritize the manufacturing of export-bound goods, offering tax and customs incentives to drive global competitiveness.
General Free Trade Zones
These zones support both import-substitution and export-promotion initiatives—reducing tariffs and streamlining trade procedures for businesses.
Investor Incentives
Enterprises within FTZs benefit from generous tax breaks, duty exemptions, simplified repatriation processes, and strategic infrastructure support.
Strategic Investment Benefits
Tax Exemptions
Exemption from all federal, state, and local government taxes, levies, and rates.
Foreign Ownership
100% foreign ownership of businesses is permitted within the zones.
Simplified Procedures
Streamlined processes for business registration and operations.
Investment Incentives
Various incentives to promote trade, attract foreign investment, and stimulate growth.
Key Free Trade Zones in Nigeria
Lekki Free Trade Zone (LFTZ)
📍 Lagos State
A multi-functional economic zone with industrial, commercial, and residential areas.
Calabar Free Zone (CFZ)
📍 Cross River State
Focused on manufacturing, trading, and services with integrated logistics.
Snake Island Integrated Free Zone (SIIFZ)
📍 Lagos
Integrated platform for logistics, trading, and manufacturing companies.
Ogun Oil and Gas Free Zone
📍 Rivers State
Specifically designed for oil and gas industry operations.
FTZ Business Setup Requirements
Companies looking to operate within Nigeria’s FTZs must complete the following steps:
Application Submission
Send a formal application to NEPZA or OGEFZA, along with supporting documents such as business plans, financials, and proposed zone activity.
Obtain Licensing
• Developer License: Required for companies managing or building an FTZ.
• Enterprise License: Issued to individual businesses operating within a free zone.
Capital Requirement
A minimum paid-up share capital of $100,000 is mandated for any Free Zone Enterprise registration.
Broader Economic Impact
Job Creation
FTZs significantly boost employment across multiple sectors—empowering local economies and reducing unemployment rates.
Foreign Direct Investment
Strategic incentives and infrastructure attract international investors, spurring capital inflows and innovation.
Export Growth
Improved logistics, customs processes, and infrastructure enable businesses to scale exports efficiently and competitively.