Companies formed under the Companies and Allied Matters Act, Laws of The Federation of Nigeria, cap 1990 as amended have two principal features.
- They are corporations, that is, artificial legal persons invested by law with most of the powers and responsibilities of natural persons. This means that companies may own property, enter into contracts, sue and be sued and in fact do and have done to them most of the things which may be done by or to human beings.
- The second main feature of incorporation is that the liability of their members to contribute toward payment of their debts is usually limited. In other words, a member of the company is not personally liable for the debts of the company.