Annual Returns Filings
The Corporate Affairs Commission, Nigeria, on November 3, 2023 published a public notice to remind the general public, and specifically, companies operating in Nigeria, along with their directors and officers, that compliance with the Companies and Allied Matters Act 2020 (CAMA) necessitates the annual filing of returns with the Commission. This followed the substantial non-compliance observed by the Commission despite its Companies Regulations 2021 which prescribed more stringent penalties than currently imposed.
Under the Companies and Allied Matters Act (CAMA), companies are mandated to file annual returns with the CAC. These returns serve as a comprehensive overview of the company’s financial and operational activities throughout the year. The information provided in annual returns aids regulatory authorities in ensuring transparency, accountability, and adherence to statutory guidelines.
The Commission noted widespread non-compliance with the annual returns filing requirement among companies in Nigeria. This was why the Companies Regulations 2021 was introduced to provide more stringent consequences for non-compliance. Despite the regulations and already existing penalties, compliance still did not improve. This prompted CAC to issue a formal reminder to companies, directors, and officers regarding the impending enforcement of these penalties.
Commencing from April 1, 2024, the CAC will fully enforce the penalties outlined in the Companies Regulations 2021 for companies failing to file annual returns. The stiffer penalties apply to both the company as an entity and its individual directors or officers. The regulatory body aims to instill a culture of strict compliance and accountability within the corporate landscape. To facilitate a smooth transition into this new enforcement phase, the CAC provides a grace period from the November 3, 2023 when the notice was published until January 1, 2024 initially. However, the Commission in a notice released on December 28, 2023 extended the commencement date to April 1, 2024. During this time, non-compliant companies, directors, and officers are strongly urged to rectify their status by promptly submitting their overdue annual returns to the CAC.
Additionally, the CAC announces a shift in its approach towards directors and officers of struck-off and wound-up companies. The Commission intends to initiate legal proceedings to recover undischarged penalties from individuals associated with non-compliant entities.
On the 6th of December, the Commission published another notice on the filing of annual returns on its website, while also uploading a list of the names of the companies who are in default and are to be struck off the Companies Register by the date given.
The updated list is available on the Commission’s website. You can also check out the list of 91, 843 companies to be struck off updated on the 23rd of November 2023 here. Companies whose names are still on the list despite filing returns are advised to send a complaint to the Commission.
It must be noted that it is illegal for a company struck off the Register of Companies to conduct business without restoration by a Federal High Court order. And also, removal from the Register doesn’t exempt the CAC from enforcing liability against the directors.
