Over 100,000 businesses that have failed to meet the requirements of registered corporations will be removed from the Corporate Affairs Commission (CAC) database following the commission’s decision. During a seminar, Alhaji Garba Abubakar, the commission’s Registrar-General and Chief Executive, made this disclosure. While conducting training on the “Use of the Beneficial Ownership Register,” the Chief Executive revealed that 100,000 companies had not filed annual returns in the past ten years and that these businesses should be prepared to come under scrutiny.
Alongside, he added that a notice would be distributed to impacted companies prior to the action in compliance with section 692 of the Companies and Allied Matters Act, which took effect in 2020. He suggested that the deregistering process may be halted if organisations with unpaid yearly return arrears did so before being deleted from the database. According to him, the court would re-enlist such corporations as is permitted by law following the annual returns had been paid in full.
Annual returns and statements to be submitted within 42 days of the AGM.
An annual fee must be paid in addition to the requirement of submitting various reports. But if a corporation fails to meet the commission’s standards, it can be removed from the registry. Organisations might struggle to maintain their annual return with CAC for a variety of reasons, such as failing to pay taxes, failing to file any necessary remittances, or failing to keep up with their corporate registers. Unless it is a single-shareholder company, every business must submit annual returns and audited financial statements within 42 days of the Annual General Meeting (AGM).
When a corporation is unable to meet its annual revenue targets, it indicates that there is a problem somewhere in the organisation. It’s possible that this was caused by a combination of factors, including changes in management, increased competition, and practises that aren’t sustainable, in addition to the absence of a solid framework. To succeed despite the obstacles, organisations will need to develop their own distinct modes of operation to accomplish their objectives. This entails redefining their purposes, establishing goals, as well as clear communication and accountability mechanisms.
The commission was established to oversee business compliance.
Moreso, the Corporations and Allied Matters Act of 1990 is an act of legislation that led to the formation of the Corporate Affairs Commission. It was established to keep tabs on new businesses and ensure that old ones are correctly dissolved. These responsibilities were also assigned to it to guarantee that businesses follow appropriate standards of conduct. Last year, the Central Bank of Nigeria (CBN) issued an order forcing all businesses that opened bank accounts without a registration certificate to regularise their accounts or face having their accounts closed pending regularisation.
In Nigeria, opening a company bank account requires registration with the CAC. Customers are more likely to have faith in a firm’s abilities if they see that the company has opened a legitimate business account in the company’s name after registering with the CAC. A certificate of incorporation is issued as evidence of the company’s registration after it has been filed. When a company formally establishes its identity through CAC registration, it is considered a distinct entity. According to the law, an incorporated firm or company is distinct from its owners or members.
Corruption, money laundering and others will be tackled.
Lastly, the Registrar-General revealed that establishing Africa’s first Beneficial Ownership Register by the CAC, with the support of the World Bank, would be a significant step forward in the fight against corruption, money laundering, and the funding of terrorist organisations. He suggested that the Broker of Record should be utilised by investigating agencies, legal practitioners, journalists, and organisations representing civil society in order to fulfil their respective roles. Some responsibilities fall on the shoulders of CAC-registered organisations in Nigeria, which must be met.