Are all C of O the same?
Differences between C of Os
COMMERCIAL REAL ESTATEINVESTOR EDUCATION
What Is Actually Written in a Nigerian C of O?
The majority of Nigerian property investors know that a Certificate of Occupancy is an important ownership document However, far fewer have taken the time to read one. In actuality, a C of O is more than a title, and it is not just a stamp of recognition. It is a legal document that contains specific terms and conditions, and those terms can differ from one property to another. So while some differences are routine, others can significantly affect your ability to buy, sell, develop, or use the property as collateral unless additional steps are taken.
Title & Legal Due Diligence
This post builds on our guide to title documentation for Nigerian property investors. For a complete overview of the evidence your lawyer should verify before you purchase a mall unit, read our guide to the Deed of Assignment →
↗
In this post
01
02
03
04
05
06
What a C of O truly represents
To understand why a Certificate of Occupancy can carry restrictions that affect what you are allowed to do with a property, it helps to understand what the document is actually certifying. Under Section 1 of the Land Use Act — the law that governs all land transactions in Nigeria — every piece of land within a state is vested in the State Governor, who holds it in trust for the people. What this means in practice is that no individual or company owns land for an indefinite period of time. What the C of O confers is a right of occupancy; the right to use and benefit from the usage of that land, subject to the terms and conditions of that grant. This is typically for a term of 99 years, from the date the first title was registered.
What this means for property transactions
Because a holder of a C of O has a right of occupancy rather than absolute ownership, the state retains certain rights and controls over the land throughout the term of that grant. Sections 21 and 22 of the Land Use Act state that a right of occupancy cannot be transferred, mortgaged, assigned, or sublet without a Governor's Consent.
Where Certificates of Occupancy differ is in the additional terms attached to a particular allocation. These conditions may depend on the purpose for which the land was allocated, the nature of the development proposed for the land during allocation, or the circumstances under which the original grant or right was awarded.
Those additional conditions are often the provisions investors overlook. The requirement for Governor's Consent is generally understood. The more important questions are whether the C of O contains further restrictions and whether those restrictions could affect your ability to buy, develop, finance, or dispose of the property.
The Non-Alienation Clause and Where It Comes From
A non-alienation clause is a provision in every Certificate of Occupancy that restricts the transfer, subletting, subdivision, or any other disposition of an interest in the land(ownership rights over a land) without prior written approval from the designated authority, often the Governor’s office and any other relevant state land administration body.
This clause reflects the Governor’s Consent statutory requirement under the Land Use Act. Any transfer of interest requires formal approval, supported by an application, applicable fees, and administrative processing. This process is the common standard in property transactions, and is routinely completed by legal representatives during conveyancing (transfer of ownership).
Now, differences emerge where the clause extends beyond the standard consent requirement. Some Certificates of Occupancy contain additional restrictions that go beyond procedural approval. These variations are tied to the conditions of the original allocation and may materially affect transferability, use, or financing of the property.
Three situations where restrictions can overturn a transaction
The following categories have been found to appear across Certificates of Occupancy issued in Lagos and other states. They have affected transactions where buyers proceeded on the assumption that standard consent procedures were sufficient.
I
Government Scheme Allocations With Fixed Non-Alienation Periods
In some government-developed residential and commercial schemes, land is allocated at subsidised rates with explicit restrictions on transfer within a defined period, commonly five to ten years from the date of allocation.
II
Agricultural or Industrial Use Allocations Applied to Commercial Development
Certain Certificates of Occupancy specify a designated land use, such as agricultural or light industrial purposes. These designations define the scope of permitted development under the grant, they define what the land can be used for.
III
Outstanding Conditions Precedent Attached to the Title
Some Certificates of Occupancy include obligations that must be satisfied for the title to remain in good standing. These may include development levies, ground rent, or infrastructural charges payable within specified timelines.
The intent is to regulate early resale of subsidised assets. During this restriction period, any attempt to transfer interest in the land remains ineffective. Governor’s Consent processes do not override the restriction. Applications submitted within the restricted period are typically declined at level of the State registry, regardless of private contractual arrangements between parties.
Where land is allocated for agricultural or industrial use, construction of residential estates or commercial retail developments requires formal approval for change of use (regularisation) and payment of the associated conversion fees. And it is not in all cases that a change of use is allowed. In such instances where this provision is not available, any contrary use is met with demolition sooner or later.
Where these obligations remain unpaid, the title is said to carry unresolved encumbrances. During a transfer process, thorough legal due diligence will show outstanding obligations flagged. If this is not properly identified and addressed, the subsequent perfection of title by the new owner through Governor’s Consent may remain pending until settlement of all arrears linked to the property.
In effect, while a private sale agreement may be executed between parties, the transaction remains incomplete in the eyes of the state until the underlying obligations are resolved.
What Happens When a Developer Ignores a Restriction
The legal effect of restrictions under the Land Use Act is set out in Section 26. Any transfer of land interest that breaches statutory requirements, including transactions carried out without the required consent or in conflict with conditions attached to a Certificate of Occupancy, is treated as void in law.
A Deed of Assignment between a buyer and a developer is merely a private contract, recording agreement between the parties, confirming payment and intent to transfer. It is only as effective as the status of the underlying statutory title and the current compliance with land administration requirements.
After execution of each deed, the transaction needs perfection. This stage involves registration at the Lands Registry and application for Governor’s Consent. In every case, the registry conducts a review of the title history and the Certificate of Occupancy to confirm whether any restrictions, arrears, or unresolved conditions exist.
When an active restriction is present, the consent process is frozen at the level of the registry. The file remains pending or is declined, depending on the nature of the restriction. As a result, the transaction remains incomplete within the land registration system, even though the private agreement between the parties has already been concluded.
This creates a bifurcation between contractual records and officially recognised ownership. The buyer holds a signed Deed of Assignment and proof of payment, but the land records still reflect the developer as the holder of the interest; until the statutory conditions are satisfied and consent is obtained.
In practical terms, the issue usually comes to light during perfection of title. Your lawyer applies to the Lands Registry for Governor's Consent and registration of the Deed of Assignment. The registry's review of the title then reveals the active restriction. At that point, the consent application cannot proceed.
You may have paid the purchase price and signed all the necessary documents, but the legal interest in the property cannot be transferred into your name until the restriction is resolved. Depending on the nature of the issue, resolution may require direct engagement with the state government, additional costs, and a timeline that is often difficult to predict.
Therefore, it is important to realize the distinction. A developer's ability to sign a Deed of Assignment does not, by itself, establish that they can transfer a clean and registrable title. Executing a contract and transferring a legally transferable interest is a separate matter. The latter depends on the condition of the underlying Certificate of Occupancy and whether it is free from active restrictions. That can only be determined through a proper review of the title documents and the relevant registry records.
What to examine when reviewing a C of O
At this point, it is imperative that your lawyer reviews the developer's Certificate of Occupancy in full. The breakdown below highlights the key sections that often restrict transferability, development rights, and future resale.
The Habendum and Covenants Page
Section to EXAMINE first
What to look for
Why it matters
Review the provisions dealing with assignment, subletting, subdivision, and possession. The language often states that the holder shall not assign, sublet, or part with possession of the land, or any part of it, without prior written consent from the Governor or another specified authority. Depending on the state, the approving authority may be the Ministry of Lands, the Commissioner for Lands, or another designated office.
This section establishes the conditions under which interests in the land can be transferred. For example, in the case of a mall development, it helps determine whether the developer can legally carve out and transfer individual units to purchasers and what approvals are required before doing so.
The standard Governor's Consent requirement is generally manageable. Greater attention is required when the wording imposes additional restrictions beyond the usual consent process.
Timeline Restrictions
Check the grant date
What to look for
Why it matters
Check whether the C of O prohibits transfer within a specified period from the date of the original grant. A clause may state that the holder shall not alienate, assign, or sublet the land within a period of five or ten years from the date of the certificate. Compare the grant date with the proposed transaction date. If the restriction period is still running, the transfer may require a formal waiver or other intervention from the state before it can proceed.
Developers sometimes receive allocations that remain within an active restriction period. In some cases, this may not be disclosed. In others, it may have been overlooked. Part of your due diligence is to verify the dates and determine whether the restriction period has expired.
If it has not, private agreements between buyer and developer do not, by themselves, make the transfer capable of registration.
The Purpose or Use Clause
Match against actual use
What to look for
Why it matters
A clause specifying the designated use of the land — "agricultural," "light industrial," "residential," "commercial." Confirm that the designated use matches what the developer is selling to you.
A Certificate of Occupancy marked "commercial", and being used for a mall development would be consistent. One marked "agricultural" or "light industrial" for the same development would constitute a discrepancy that requires formal resolution before the title can be considered clean and transferrable.
Land use classifications are strict conditions attached to a property's title. Changing how a piece of land is used generally requires a formal application to the state, an official review, and the payment of relevant fees.
Until that process is fully documented, a major disconnect remains between the official title and the actual physical development. This discrepancy puts the building at risk of demolition and creates significant hurdles during future sales, financing, or institutional due diligence.
Pitfall: It is urgent to note that the state does not accept all applications for a change of use. If an application is rejected, the government typically enforces demolition and withdraws ownership rights. Therefore, the safest strategy is to purchase property only where the intended land use already matches the permitted zoning.
The Certificate of Occupancy Is Not a Verdict of Clear Title
A Certificate of Occupancy is evidence that the state has granted a right of occupancy over a defined parcel of land to a named holder. It does not always confirm that the land can be freely transferred or that it is fully aligned with a specific development or investment intention.
The scope and limits of ownership are contingent on the contents of this document. For this reason, a developer’s possession of a C of O is merely the starting point of title verification.A meticulous and guided review of the document itself will reveal the relevant questions to be asked along the way.
To carry forward
Related reading
Title Documentation for Lagos Mall Investors
The complete list of the document evidences to check — what to verify at the Lands Registry before committing to any mall unit purchase.
Back to the series
Buying 90sqm–150sqm in an Off-Plan Lagos Mall
The main investment guide — infrastructure, leasing structures, CAM charges, and the KVA question every investor should ask.
© 2026. All rights reserved.
Member of the Billionaires Realtors Group (BRG)
EDET REAL ESTATE
Contact: info@edetrealestate.com