The Advertising Regulatory Council of Nigeria (ARCON),the agency in charge of advertisement regulation, has unveiled an array of measures aimed at transforming the industry, aligning with the government’s economic recovery and inclusive development policies. Starting from 1st of April, 2024, all sectoral groups of advertising agencies will be mandated by ARCON to provide a ₦1 billion professional indemnity Insurance cover to its members. Olalekan Fadolapo, the Director General of ARCON, during a press conference held in Abuja, emphasized the importance of professional indemnity for association members, as it is a key component of their corporate license obligations.
He said the Council, in consultation with the Advertising Sectoral Groups (HASG) and various interested parties, will initiate a comprehensive evaluation of the financial organization and operational fund necessity of the advertising agencies, and will subsequently release regulatory directives soon. Fadolapo revealed plans to join forces with the Economic and Financial Crimes Commission (EFCC), along with the National Broadcasting Commission (NBC) and various governmental bodies. Collectively, their aim was to implement a strict 45-day credit policy throughout the industry. This policy would be backed by stern penalties for any organization daring to contravene it, thus marking them as economic saboteurs.
There are plans to enforce a ban on foreign advertisements.
According to him, it is imperative to put an end to the relentless struggle of the industry caused by certain stakeholders who grant a 120-day payment cycle to Nigerian media and service providers. Interestingly, these stakeholders readily prepay foreign media houses for their services in Nigeria. We must take a stand against this unjust practice, he urged. The utilization of local skills in all Nigerian market ads is strongly advocated by the Council, which also intends to prohibit the utilization of international models and voices unless approved by ARCON’s Director General.
Additionally, ARCON plans to enforce a ban on foreign advertisements and apply substantial levies on their importation. In accordance with this, if you aim to sell your product to the Nigerian market, it is advised to incorporate Nigerians within your advertisement, as stipulated by Council. The underlying objective is to generate employment opportunities for Nigerian youths, foster growth and advancement within the support service sector of the industry, and promote the circulation of funds within the Nigerian advertising ecosystem, as stated by Fadolapo.
Media prices in the field continue to be unregulated.
In its quest to create a strong and advantageous data bank for the industry, ARCON has proposed a nationwide audit of advertising agencies, targeted exclusively at licensed ones in line with its establishment Act. The Council aims to gather all necessary details from stakeholders and only involves licensed agencies. As per the Director General, the media prices in the field continue to be unregulated, enabling market forces to determine the commercial activities of media services. The Council said Nigerian media should be treated with equal respect and adherence to business practices as their foreign counterparts operating in the country.
Another announcement made is the plan to establish a team led by its Director General to setup the arrangement and coordination of a nationwide seminar on Out-Of-Home (OOH) advertising enterprises. Also, the Council plans to work in conjunction with the signage agencies of the various states and the Outdoor Advertising Association of Nigeria (OAAN) to develop a comprehensive regulatory framework for the OOH advertising industry. With this, ARCON aims to gather insights and suggestions from all pertinent stakeholders in this endeavour.
Related Article: FG set to reform the advertising industry
Fadolapo clarified that the recent regulations align with the Minister of Information and National Orientation, Mohammed Idris’s directive to enhance the regulatory framework governing the Nigerian advertising sector and counteract the industry’s prevailing adverse patterns. The marketing and advertising sphere holds immense importance in the Nigerian economy, as it contributes approximately 20% towards the gross domestic product and generates employment opportunities for numerous individuals. With appropriate Regulation and support, the industry could expand even more and make a greater contribution to the country’s development, he stated.