Hotels & Tourism Licensing and Regulatory Regimes

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A proper understanding of the various federal, state and local government licensing and regulatory regimes in the Hotels, Hospitality and Tourism markets in Nigeria is critical to the execution and substance of a viable business plan in any of these sectors. This Legal Alert is our contribution to your achieving this objective.

At the federal tier of government, the apex regulatory authority is the Nigerian Tourism Development Corporation (“NTDC”) which is established by law to register, classify and grade all hospitality and tourism establishments, travel agencies and tour operators in Nigeria.

For operators of Hotels, Tourism and Events establishments in Lagos State, attention is brought to the Lagos State Hotel Licensing Law as amended in 2010 (“LSHLL”). This Law regulates the licensing of Hotels and other Tourism Establishments in Lagos State.

Like the NTDC Act, the LSHLL (as amended) also requires all operators of Hotels and Tourism Establishments in Lagos State to display in prominent sections of their Hotels their LSHLA license.

There is also in Lagos State a Hotel Proprietors Law which regulates the rights, duties and liabilities of all Hotel Proprietors to the customers who patronise the services offered in Hotels in Lagos State.

There are other various Permits and Licenses which a Operator of a Hotel must also apply for from the Local Government Authority in the area where its carries on business; and ensure the renewal of these permits and licenses at all times while carrying on business.

As most Hotels, Hospitality, Tourism and other leisure establishments are incorporated limited liability companies, they are required to pay thirty per cent (30%) of their annual profits as companies’ income tax, two per cent (2%) as education tax, deduct and remit pension fund contributions, make 1% employees payroll compensation fund contributions, etc.

There are multiplicity of taxes and regulations requiring constitutional resolution and encourage investments.

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Published In: Art, Entertainment & Sports Updates, Business Organization Updates, Tax Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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