HomeNewsCAC Advises Nigerians Against Registering Businesses Without Plans to Operationalise Them

CAC Advises Nigerians Against Registering Businesses Without Plans to Operationalise Them

Date:

The Corporate Affairs Commission (CAC) is urging the public to refrain from opening or registering businesses unless they have immediate plans to operationalize them.

Mr. Justine Nidia, the Director of Compliance at CAC, emphasized this advice in an interview with the News Agency of Nigeria (NAN) on Sunday.

Nidia clarified that the commission does not support the registration of companies without a developed business idea that intends to be put into action. He said keeping such companies in the CAC’s registry amounts to encouraging Shelf/briefcase companies

He said,

  • “It is not advisable to register a company and keep it in your briefcase because that is not helpful to the economy,”
  • “The idea of delisting companies is that we should not be seen encouraging shelf companies.”
  • “By shelf companies, we mean registered companies that are redundant or dormant; they are not doing anything.”
  • “So, they do not have to be on the register of companies. The appropriate thing to do is to remove them or strike them off the register,”

Delisting of 100 companies

He said the commission had published an initial list of about 100,000 companies to be delisted.

He stated,

  • “We gave an initial period of 90 days, which has elapsed, to those who think they will still be in business to file annual returns for them not to be delisted.”
  • “After the initial publication, about 5,000 companies responded to file their annual returns, with the remaining approximately 95,000 to be delisted.”
  • “What we have done recently is to issue another publication, requesting companies that have filed their returns, and their names are still on the list to get back to us with evidence.”
  • “So, we do not delist a company that already filed its return. So, we have given an additional period of one month, after which we will gazette the final list,”

Backstory

Nairametrics recently reported the CAC’s plan to delist 91,843 companies for failure to file annual returns

In July, Garba Abubakar, the former Registrar-General and CEO of the CAC, announced the intention to remove 100,000 registered businesses from the commission’s database due to their failure to submit annual returns.

Abubakar emphasized that the commission would issue notices of striking off to the affected companies by the provisions of section 692 of the Companies and Allied Matters Act (CAMA) of 2020 before taking the necessary action.

Nairametric

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