The Corporate Affairs Commission (CAC) has initiated the process of removing a substantial number of companies from its official register due to their failure to adhere to the Companies and Allied Matters Act 2020. This action, announced via a notice on the CAC’s Instagram page and website, follows a previous warning issued late last year targeting dormant companies with a decade-long history of non-compliance with annual return filings. This current wave of de-registrations, identified as the fifth batch, affects approximately 100,000 companies incorporated between 2002 and 2006, all of which have remained inactive for roughly 10 years. The comprehensive list of these companies is publicly accessible on the CAC’s website.
The CAC’s decision to strike off these companies underscores its commitment to enforcing regulatory compliance and maintaining the integrity of the corporate register. The Companies and Allied Matters Act 2020 mandates companies to file annual returns, which include crucial information about their operations, financial standing, and ownership structure. This information is essential for transparency, accountability, and the effective functioning of the corporate ecosystem. By removing non-compliant companies, the CAC aims to ensure the accuracy and reliability of its register, while also discouraging corporate delinquency and promoting a culture of compliance. This action further serves to protect stakeholders and the public by preventing dealings with entities that are not operating within the legal framework.
The affected companies are granted a 90-day grace period from the date of the publication of the notice to rectify their status by fulfilling their outstanding annual return filing obligations. This includes submitting information regarding Persons with Significant Control (PSC) or Beneficial Ownership, a key aspect of transparency and anti-money laundering efforts. Failure to comply within this timeframe will result in the companies being formally struck off the register, effectively ceasing their legal existence. The CAC emphasizes the seriousness of this consequence, highlighting that de-registered companies are prohibited from conducting any further business activities. The loss of corporate status signifies the forfeiture of all rights and privileges associated with the entity, rendering any subsequent business operations unlawful.
This move by the CAC reflects a broader effort to modernize and streamline corporate governance in Nigeria. The recent launch of the Intelligent Company Registration Portal (ICRP), an AI-powered system designed to enhance the efficiency and effectiveness of company registration processes, further exemplifies this commitment. The ICRP leverages artificial intelligence to automate and expedite various aspects of company registration, thereby reducing processing times, minimizing human error, and improving overall service delivery. This initiative aligns with the CAC’s overarching goal of fostering a more transparent, efficient, and robust corporate environment.
The CAC’s actions send a clear message to the corporate community about the importance of adhering to regulatory requirements. By actively enforcing compliance and leveraging technology to improve its operations, the CAC is working towards creating a more transparent and accountable corporate landscape. The de-registration of these companies not only ensures the integrity of the corporate register but also fosters a business environment that encourages responsible corporate behavior and protects the interests of stakeholders. The 90-day window offers a final opportunity for the affected companies to demonstrate their commitment to compliance and avoid the severe repercussions of being struck off.
This decisive action by the CAC demonstrates the agency’s commitment to upholding the rule of law and promoting good corporate governance. The message is clear: compliance is non-negotiable, and failure to adhere to the established regulations will result in consequences. This proactive approach contributes to the development of a stronger and more sustainable business environment in Nigeria, one characterized by transparency, accountability, and adherence to the principles of good corporate citizenship. The use of technology, as exemplified by the ICRP, further enhances the CAC’s capacity to effectively regulate the corporate sector and ensure its continued growth and development within the bounds of the law.
