The number of courier and logistics business owners has been on the increase. This is a result of the shift from brick and mortal trading model to online market places. The rise of e-commerce has tripled the need for dispatch and delivery services.
Today’s people are shopping online, buying almost everything on the web. Merchants, vendors and online stores are also increasingly demanding for delivery services.
If you are planning to setup a courier or logistics business in Nigeria, It is likely because you are looking to tap into this ever growing sector.
In this article, we would provide insights to all the questions people before they start a dispatch or logistics business in Nigeria. You can also contact us directly if you would like us to help you get started.
What Is A Courier or Logistics Business?
A Courier or logistics business is a person or company who transmits messages or transports messages and packages.
A courier or logistics business is also a messenger, but not necessarily of verbal communications. He carries something – documents or goods – from one party to another.
Who Regulates Courier or Logistics Business In Nigeria?
The Courier and Logistics Regulatory Department (CLRD) regulates courier and logistics business.
The CLRD was created in 2002 to separate the functions of Nipost as a regulator from its function as a competition in the courier and logistic business environment.
Hence, a courier or logistics business that seeks to operate in Nigeria must obtain a license from the CLRD before operating.
Categories of Courier or Logistics Business Licenses in Nigeria
There has been several changes to the categories of licenses issued and the courier and logistic business sector of Nigeria is currently undergoing reforms. Currently there are four categories of courier and logistics business licenses and they are as follows:
1. The International License
For operators in Nigeria delivering parcels locally and internationally. This applies to big courier companies that have the capacity to acquire airplanes and other large vehicles. The international courier and logistics business license fee is N20,000,000 (Twenty Million Naira). The yearly renewal fee is N1,875,000.00 (One Million Eight Hundred & Seventy Five Thousand Naira).
2. The National License
For operators delivering parcels within and across the country. If operating in Lagos for instance a National license would allow you deliver parcels to any state in Nigeria. The cost of a National courier and logistics business license is N3,000,000 (Three Million Naira). The yearly renewal fee is N625,000.00 (Six Hundred & Twenty Five Thousand Naira).
3. The Regional License
A courier and logistics business with a Regional license would be able to operate in any state within a region. Regions in Nigeria are South, East, West and North. The cost of a Regional license is N2,000,000 (Two Million Naira). The yearly renewal fee is N437,500.00 (Four Hundred & Thirty Seven Thousand Five Hundred Naira).
4. The State/ Special SMEs License
If you have a state license you can only operate within a state. State license is specially designed for those who have between one to five bikes and are operating on a small scale. The cost of obtaining a state/special SMEs license is N250,000 (Two Hundred & Fifty Thousand Naira). Annual renewal fee is N100,000.00 (One Hundred Thousand Naira).
How Do I Register A Courier Or Logistics Business?
You can register a courier business as:
- a private company limited by shares;
- a public company limited by shares;
- a private unlimited company;
- a public unlimited company;
- a Limited partnership;
- a partnership;
- a Limited Liability Partnership;
- a sole proprietorship
The procedure for registering a courier business is the same as registering any other business in Nigeria.
How To Apply For A Courier or Logistics Business License
The procedure includes writing a letter of application for a licence to the Minister through the Postmaster-General. The procedure is as follows:
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- You are to forward an application for a new license on the company’s letter headed paper to General Manager (CRD) Nigerian Postal Service (NIPOST), Communications Building, Lafiaji, Lagos, Nigeria.
- The application should be forwarded with a non-refundable application fee of N20,000.00 which can be paid online through Remita.
- The payment of application fee entitles the applicant to registration form and Courier Operations Regulations.
- The filled or completed application form should be submitted to the above address with the license fee, in Bank Draft of the license category.
Note that you are to pay the non-refundable license fee to the Postmaster General.
- Thereafter, the CLRD will inspect the facility of the prospective courier or logistics business operator
- The success of the facility inspection entitles the prospective operator to a new courier license.
- Induction and orientation course is mandatory before presentation of operating license.
Documents You Should Submit
You are to submit or upload the following documents:
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- Certified True Copy of Certificate of Incorporation
- Memorandum/article of association
- Company’s tax clearance certificate for the last three years (Original to be sighted)
- Leasehold certificate or tenancy agreement in respect of the company registered office.
- Evidence of payment of license and application fees.
- Names, qualification, addresses and telephone numbers of all directors of the company.
- Sample of waybills, labels, bags, tags, envelopes, receipt, and registered trademark (if any).
- Partnership, merger, alliance (or such other arrangements agreements (if any).
- Any other information required from time to time.
What Is The Length of a License and How Do I Renew My License?
Section 45 (1) of the NIPOST Act provides that
The Minister may, on the recommendation of the Postmaster-General, grant a licence to an applicant under this Act if he is satisfied, from all the evidence and information supplied to him, that the applicant is suitable to operate a courier service.
Section 45(2) goes further to state that
a licence granted under subsection (1) of this section, shall be valid and operative for one year from the date of issue and may be renewed.
Procedure for Renewal is Stated Below:
- Application for renewal should be submitted to the above address at least three months to the expiry date of the license for processing
Notwithstanding the application for renewal, the same section 46 bestows the power to revoke a license on the Minister at any time. The section states that the Minister may revoke any licence if he believes that it is in the interest of the public so to do.
What Are The Consequences of Not Having A License?
Section 50 of the Act makes it an offence for any person to operate a courier service without a license. The directors, secretaries, partners or any other person who participates in running the company without a license would be individually liable upon conviction to pay a fine not exceeding N50,000 (Fifty Thousand Naira.)
When You Can Engage in Delivery Without A License
It is trite law that a company will not qualify as a courier company if it simply delivers its products, mails or packages to its clients. Section 3 of the NIPOST Act defines instances or activities that are not within the purview of the regulation of NIPOST.
