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ABSTRACT


What provoked this research is the visibilly wanning national Sovereignty and Jurisdiction of
developing Countries to make choice from options in economic, social and cultural policies due to
globalization. The need to unravel the challenges the regulatory Legal Frame Work for Foreign
investment in Nigeria faces, its impact on our national policies and policy making mechanisms and
finding solutions. The methodology employed in this research is the doctrinal research. Primary and
secondary materials sourced are analyzed. Foreign investment involves the transfer of a package of
resources including capital, technology, management and marketing expertise. This can generally be
divided into, Foreign Direct Investment (FDI) and Portfolio Investment (PI) although loans to
government (i.e. foreign debts) have also been seen as a third category. The purpose of FDI is to
acquire a lasting interest and effective control in the management of an enterprise without necessarily
having majority shareholding. Portfolio Investments on the other hand, are directed at earning
dividends, interests, capital gains and so on without participating in management.
The Multinational Corporations (MNCs) are major sources of foreign direct investment (FDI).
The regulatory Legal Frame Work is the power of host country through its law and regulatory bodies,
authorities, and agencies to control investment activities by providing conditions that affect the
behaviour of investors and development of investment to ensure fair and beneficial operations. These
agencies including the Nigerian Investment Promotion Commission (NIPC), National Office for
Technology Acquisition and Promotion (NOTAP) and Nigeria Oil and Gas Industry Content
Development. The regulatory Legal Frame Work for foreign investment in Nigeria is confronted
with many issues and challenges which make it impossible to achieve the objectives of government
to regulate foreign investment, such as globalization of policy-making which has led to the erosion of
national sovereignty, narrowed the ability of governments and people to make choices from options
in economic, social and cultural policies; negative influence of the multinational corporations
(MNCs) over government policies, lack of commitment on the part of government, non enforcement
of penalties and inadequate penalty regimes, ineffective administrative systems and blind adoption of
economic terms “dictated” by global markets and international institutions amongst others.
Considering that the regulatory legal frame work plays a crucial role in the economic life of the
nation, government should pay adequate attention to it. Consequently, investment policies and
regulations should be backed by law to enhance enforcement. The findings indentified in this work
show that the penalties in Nigerian Investment Regulatory Frame Work such as Section 55 CAMA
and Section 15 (1)(2) NOTAP are inadequate and do not have the force of deterrence. Procedure for
exemption of Foreign Company from registration in Nigeria under Section 56 (1)(a)-(d) to the effect
that such application should be made to the Council of Ministers through the Secretary to the
Government of the Federation. The procedure is unnecessarily cumbersome and time wasting and
will discourage donor international organizations and countries willing to undertake specialist
projects under contract with any of the Governments in the Federation or their agencies. The
National Office for technology Acquirsion and promotion (NOTAP) Act provides for the agency to
vet agreements to be submitted to it by Nigerian Companies after negotiating and concluding with
the Foreign technical partners and leaves much to be desired in the quest for maximum benefit from
technology transfer and Foreign Investment in Nigeria.

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