Africa Entrepreneurship Legislation Nigeria

Doing Business in Nigeria: Regulatory requirements for operating a restaurant

With a growing population of over 200 million, food production is one of the most lucrative businesses in Nigeria. In 2016, the Association of Fast Food and Confectioners of Nigeria (AFFCON) estimated the food industry to be worth over a trillion naira.

In April 2020, Euromonitor International reported that demand for restaurants in Nigeria will continue to grow due to expansion of the mid-income group, growing urbanization and busy lifestyle of Nigerians.

To operate a restaurant business in Nigeria, there are a number of regulatory requirements which Restaurant Operators (ROs) must comply with, some of which are discussed below.

Environmental Regulations

The Minister of Environment is empowered under the Environmental Health Officers (Registration, Etc) Act of 2002, to issue regulations and directions for Health Officers Registration Council of Nigeria (EHORECON). In several states, the state Ministry of Environment issues guidelines to relevant regulatory agencies to ensure compliance with environmental laws. Consequently, by law, all food outlets, including ROs, must apply and obtain a permit to ensure compliance with basic health and safety guidelines within their immediate environment. The premises of the restaurant will be inspected to ensure that the facilities are well ventilated, with regular disinfection, accessible water supply, disposable towels, rest room facilities, self-closing doors, medical certificate of fitness and training of the food handlers, amongst others.

Read more: Nigeria – Application of withholding tax on non-resident companies under the finance act

Local Government licenses

In Lagos State for instance, ROs are required to apply for a food permit within the Local Government where the restaurant is located prior to commencement of operations. In addition, where the alcohol will be sold by an RO, a liquor permit is a requirement. Other relevant licenses issued by the local government are Television License (to use a television or radio), Private Entertainment and Merriment Permit (to run loud entertainment ventures) and Private Car Park Permit (to own a car park). The applicable fees for obtaining these licenses are subject to assessment of the local government officials.

National Agency for Food and Drug Administration and Control (NAFDAC)

NAFDAC, a federal government agency which regulates the production, manufacturing of food and drugs in Nigeria created under National Agency for Food and Drug Administration and Control Act of 1993. Generally, restaurants which process and sell food products in commercial quantity may be required to obtain a Good Hygiene Practice (GHP) license from NAFDAC prior to commencement of operations. A GHP license is usually issued upon satisfaction that the equipment of the food processor meets certain standards and that the food handlers possess the required certification.

Signage/Advertising

In operating a restaurant, it is typical to place a signage outside the premises for the purpose of advertising. To achieve this, Lagos State signage laws require all businesses, including ROs, with outdoor advertising to obtain a signage permit with the Lagos State Signage and Advertisement Agency.

Conclusion

There are other regulators such as the Federal Competition and Consumer Protection Commission, states’ ministries of health and the relevant federal and state tax regulatory bodies, who are in charge of ensuring compliance with applicable laws and regulation. Whilst there may be an overlap in their functions, the common goal of the regulators is to ensure the general welfare and safety of consumers.

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