The Federal Government has announced the temporary suspension of annual dues imposed on public interest enterprises by the Financial Reporting Council of Nigeria (FRCN).
The decision follows growing concerns raised by the organised private sector, including the Nigeria Employers’ Consultative Association and the Manufacturers Association of Nigeria, over the potential financial impact of the Financial Reporting Council (Amendment) Act 2023.
Dr. Jumoke Oduwole, Honourable Minister of Industry, Trade, and Investment, disclosed this decision during a stakeholder forum on Wednesday.
She stated that the suspension allows for a review of the concerns raised.
“The government has decided to direct the Financial Reporting Council to pause in the implementation of the new annual dues. You know that I am a lawyer, and a suspension request by the organised private sector would be in contravention of legislation duly passed by the National Assembly. A pause is an administrative process simply to review, in line with what we discussed today,” Oduwole explained.
Contentious Provisions and Industry Concerns
The 2023 FRC Amendment Act imposes cumulative annual charges on non-listed entities and includes a contentious provision for a 10% penalty on unpaid dues for every month of default, compounding until full payment is made.
Stakeholders at the forum highlighted how these measures could negatively impact businesses, especially in Nigeria’s challenging economic environment.
Dr. Oduwole emphasized the government’s responsiveness, assuring stakeholders that the suspension would not exceed 60 days.
“We are a listening administration. The private sector has requested a range from three months to an indefinite suspension. We are not going to do that. So, at the most, 60 days is in my estimate. We are going to set up a technical working group comprised of the FRC and the organised private sector who have formally written in, and this will be reviewed,” she said.
At the heart of the discussions lies Section 33(1)(c) of the FRCN Act, which mandates quoted companies to pay annual dues based on 0.002% of their market capitalization or N25 million, whichever is lower. Stakeholders expressed concerns over how this would affect companies’ financial stability.
What you should know
- Reaffirming the Ministry’s dedication to collaboration, Dr. Oduwole stated that the Ministry remains committed to working closely with stakeholders.
- She added that constructive dialogue around regulatory policies is essential to ensure that all businesses — large and small — are supported in a fair and sustainable way.
- According to her, this is critical to enhancing business competitiveness and aligning with Nigeria’s broader economic transformation agenda.
The government has also initiated plans to establish a technical working group comprising representatives from the FRC and the private sector to carefully review the concerns raised.
This initiative aims to strike a balance between regulatory compliance and fostering a business-friendly environment in Nigeria.
