Startup passporting is the process of taking a startup that has proven its product in one country into new markets. For our clients, that usually means one of two journeys: a Nigerian startup expanding abroad, whether to Ghana, Kenya, the United Kingdom, the United States, the United Arab Emirates or Europe, or a foreign startup entering Nigeria, one of the largest consumer markets in Africa.
The term comes from financial regulation. In the European Union, a firm authorised in one member state can, in certain sectors, "passport" its licence to operate in others. Most of the world does not work like that. A company, licence or registration in one country generally does not allow a startup to operate in another, so each new market needs its own legal presence, registrations and, for regulated businesses, its own licences. This guide explains how startup passporting works in practice in both directions, and how we help.
Where passporting is possible, and where it is not
| Framework | What it allows | Who benefits |
|---|---|---|
| European Union and European Economic Area | Firms authorised in one member state can provide certain financial services across the EEA | Startups licensed in an EU country, not UK firms after Brexit |
| West African Economic and Monetary Union (WAEMU) | A single licence from the regional central bank can cover payment and e-money services in eight francophone countries | Fintechs entering Côte d'Ivoire, Senegal and their neighbours |
| OHADA | Shared business and company laws across seventeen, mainly francophone, African countries | Businesses setting up in several OHADA states |
| African Continental Free Trade Area | Reducing barriers to trade in goods and services, with protocols on investment and digital trade | Businesses trading across Africa |
| Everywhere else | No automatic passport: each country requires its own presence and licences | Most expansions, including into and out of Nigeria |
Some regulators also run cross-border testing programmes and cooperation agreements that make it easier to engage with a new regulator, but they do not replace a local licence.
Our startup passporting services
We help startups and growing businesses expand in both directions. Our work typically includes:
- Market entry assessment: mapping the company, licensing, tax, data, employment and intellectual property requirements in the target country
- Choosing the entry route: serving remotely, partnering locally, setting up a subsidiary or branch, or acquiring a local business
- Group structuring: deciding where the new company should sit and how it connects to the rest of the group
- Company set-up: incorporating subsidiaries in Nigeria, and coordinating incorporation abroad with trusted local counsel
- Licensing: applying for licences or putting compliant partner arrangements in place, particularly for fintechs and other regulated startups
- Contracts: partner, distribution, intercompany, employment and customer agreements that work in each market
- Brand protection: trademark filings in each new market
- Ongoing compliance: filings, renewals and regulatory reporting once the business is operating
We act directly in Nigeria and coordinate a network of trusted lawyers in other countries, so clients have one team in charge of the whole expansion.
Choosing how to enter a new market
| Entry option | How it works | Best for |
|---|---|---|
| Serve remotely | Customers abroad use the product without a local entity | Testing demand, where no local licence is needed |
| Local partner | A licensed or established local business distributes or powers the product | Regulated products, early traction, lower cost |
| Subsidiary | A new local company owned by the startup or its holding company | Long-term presence, hiring, local contracts and licences |
| Branch or representative office | The foreign company registers to operate directly, where local law allows | Limited activities in countries that permit branches |
| Acquisition | Buying a local company with a licence, team or customers | Speed to market |
Many startups move through these stages, starting remotely or with a partner and setting up a subsidiary once the market proves itself.
Passporting out of Nigeria: Nigerian startups going abroad
Nigerian startups expand to markets across the world. The most common destinations, and what each involves, are:
| Destination | Company set-up | Points to consider for regulated startups |
|---|---|---|
| Ghana | Office of the Registrar of Companies, with at least one director resident in Ghana | Bank of Ghana licensing for payments and e-money, and investment registration for foreign-owned companies |
| Kenya | Business Registration Service, largely online | Central Bank of Kenya authorisation for payments and digital credit, and local ownership rules in some sectors |
| South Africa | Companies and Intellectual Property Commission | Exchange control, financial services licensing and empowerment requirements |
| Francophone West Africa | OHADA company law, documents in French | WAEMU licence covering several countries |
| United Kingdom | Companies House, quick online incorporation | Financial Conduct Authority authorisation for payments, e-money and lending |
| United States | Usually a Delaware corporation | State money transmitter licences and federal registration for payments businesses |
| United Arab Emirates | Mainland or free zone companies | Regulators differ between the mainland and financial free zones such as DIFC and ADGM |
| European Union | Company in the chosen member state | A licence in one member state can be passported across the EEA |
Requirements change regularly and depend on the activity, so we confirm the current position with local counsel for every market.
Passporting into Nigeria: foreign startups entering the Nigerian market
Foreign startups are drawn to Nigeria's large, young and digitally active population, but the market has its own rules:
- Local company: under the Companies and Allied Matters Act 2020, a foreign company must generally incorporate a Nigerian company to carry on business here; see our guide on how to register a foreign-owned company in Nigeria
- Investment registration: registration with the Nigerian Investment Promotion Commission and a Certificate of Capital Importation for the money brought in, so that profits can later be repatriated
- Licences: the Central Bank of Nigeria licenses payments, lending and banking; the Securities and Exchange Commission regulates investment and digital asset businesses; and the Nigerian Communications Commission, NAFDAC and other regulators cover their sectors. See our guide to the PSSP licence in Nigeria
- Expatriate staff: a business permit and expatriate quota for foreign employees; see our guide to the business permit and expatriate quota in Nigeria
- Data protection: compliance with the Nigeria Data Protection Act 2023, including registration with the Nigeria Data Protection Commission where required
- Startup incentives: qualifying startups can apply for a label under the Nigeria Startup Act 2022, which has local shareholding requirements; see our startup label service
See also our setting up a business in Nigeria service.
Licensing for fintechs and regulated startups
Regulated startups face the biggest passporting challenge, because each central bank or regulator licenses its own market. Before launching in a new country, a fintech should map:
- which activities need a licence there, such as payments, e-money, lending, remittances or digital assets
- whether a local partner's licence can be used lawfully while the startup applies for its own
- capital, governance, local directors, data storage and compliance requirements
- how long licensing takes, and whether a regulatory sandbox is available
- approvals needed from the home regulator when a licensed company invests abroad or its ownership changes
See our fintech lawyers service.
Tax, money and transfer pricing
Each company in a group is taxed in its own country, and payments between group companies, such as management fees, technology licences and loans, must be priced at arm's length under transfer pricing rules. Money moving into or out of Nigeria must go through authorised dealer banks under CBN foreign exchange rules: foreign investment into Nigeria should be supported by a Certificate of Capital Importation, and Nigerian companies funding foreign subsidiaries should use official channels so that profits can come back. Double tax treaties, where they exist, can reduce tax on dividends, interest and royalties. See our tax advisory service.
Data protection across borders
Expanding startups often process customer data in several countries on shared systems. They must comply with the data protection law of each market, such as the Nigeria Data Protection Act 2023, the European Union's GDPR or Kenya's Data Protection Act 2019, including rules on transferring personal data between countries and, in some cases, keeping certain data locally. See our data protection compliance service.
Intellectual property and brand
Trademarks are territorial, so a registration in one country does not protect the brand in another. Startups should file in each target market before launching. Regional systems such as ARIPO and OAPI cover groups of African countries, and many countries accept international applications through the Madrid system. Nigeria is not currently part of the Madrid system, so foreign brands entering Nigeria must file directly with the Nigerian Trademarks Registry; see our guide on how to register a trademark in Nigeria.
Hiring and people
Startups expanding abroad can hire through a local subsidiary or, in the early stages, an employer of record that employs staff on their behalf. Staff who relocate need work permits in the new country, and foreign staff moving to Nigeria need an expatriate quota position and residence permit. Employment contracts and employee share options must work under the law of each country.
Structuring the group
The group structure matters to investors and affects tax and regulation. Common approaches include:
- Home company as parent, owning subsidiaries in each new market
- International holding company, such as a Delaware, UK, Mauritius or other holding company, owning the companies in each country; see our guide to an offshore company for Nigerians
- Regional holding companies for groups of markets
See our guide to corporate structures in Nigeria and our startup fundraising service.
Startup passporting checklist
- Validate demand in the target market and choose the entry option
- Map the licences, registrations and ownership rules that apply
- Decide where the new company will sit in the group
- File trademarks in the new market
- Incorporate the local company and appoint any required local directors
- Register for tax, social security and data protection
- Obtain licences or sign compliant partner agreements
- Open bank accounts and fund the company through official channels
- Put intercompany, employment and customer agreements in place
- Launch, then keep up with local filings, renewals and reporting
Common mistakes
- Assuming a licence or registration at home allows the startup to operate abroad
- Using a local partner's licence without a clear agreement on responsibilities and customer funds
- Moving money between countries outside official channels
- Launching before the brand is protected in the new market
- Building the group market by market without a plan, which then has to be unwound before a fundraise
How we can help
Our startup lawyers and corporate and commercial lawyers in Lagos and Abuja run startup passporting projects in both directions: Nigerian startups expanding to other countries, and foreign startups entering Nigeria. We map the requirements, design the structure, set up companies, coordinate licensing with trusted local counsel abroad, and keep each part of the group compliant. See our corporate structuring and international expansion service. To discuss your expansion, contact us.
Frequently asked questions
What is startup passporting?
Startup passporting means taking a startup that has grown in one country into other markets. Outside a few regional frameworks, there is no automatic passport, so startups need a legal presence, registrations and licences in each new country.
Can a licence in one country be used in another?
Generally, no. Licences are national. Exceptions include passporting of certain financial services licences within the European Economic Area and single licences that cover several WAEMU countries.
How can a foreign startup start operating in Nigeria?
Usually by incorporating a Nigerian company, registering with the Nigerian Investment Promotion Commission, bringing in capital through an authorised dealer bank and obtaining any licences its activities require, such as CBN licences for payments or lending.
Can a Nigerian startup operate in Ghana or Kenya with its Nigerian registration?
Generally, no. A Nigerian company is a foreign company in Ghana and Kenya. It needs to register locally, or work through a local partner, and obtain any licences its activities require.
Does a CBN licence allow a fintech to operate in other countries?
No. A CBN licence only covers Nigeria. Each country's regulator licenses its own market.
Should a startup expand with a subsidiary or a local partner?
A local partner can be faster and cheaper, especially for regulated products. A subsidiary gives more control and is usually needed for a long-term presence, hiring and local licences.
Do I need to register my trademark in each country?
Yes. Trademarks are territorial. Regional systems such as ARIPO and OAPI, and the Madrid system in member countries, make filing in several countries easier, but Nigeria requires a direct national filing.
How do you help with startup passporting outside Nigeria?
We plan the expansion, structure the group and prepare the Nigerian side, and work with trusted local lawyers in the target country on incorporation, licensing and local compliance, so the client has one team coordinating the whole project.
