The Advertising Regulatory Council of Nigeria (ARCON) has announced sweeping reforms that are considered critical to repositioning the Nigerian advertising industry for growth.
These areas are professional indemnity for licensed sectoral groups, capital structure and capital working, 45 days payment threshold, use of local talents, data bank for advertisement agencies and media rates deregulation.
Director General of ARCON, Dr. Olalekan Fadolapo who disclosed this in Lagos on Tuesday, said the reforms are needed to strengthen and ensure financial stability of the industry.
“In line with the federal Government policy of economic recovery, inclusive growth, development of local talents, and the directive of the Hon. Minister of Information and National Orientation, Alhaji Mohammed Idris on the need to strengthen the Nigerian Advertising Industry regulatory framework and reverse the negative trajectories currently plaguing the industry.”
“As part of the ongoing advertising industry reform and the need to strengthen advertising agencies service delivery, build capacity as well ensure long-term stability in the industry, each sectorial group is to provide N1 billion professional industry insurance cover for its members. This covers professional indemnity for members of their association as part of the corporate license requirements.”
This, according to him, covers professional indemnity for members of their Association as part of the corporate license requirements. The full implementation of the corporate license regime will take effect from April 1, 2024,” he revealed.
On the controversial credit circle, Dr. Fadolapo revealed that the apex advertising regulatory body is collaborating with EFCC, NBC and other government agencies on the implementation of the 45 days credit threshold in the advertising industry.
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“Any organisation that offered payment threshold outside 45 days credit policy will be tagged as economic saboteur of the Nigeria advertising industry. Such organisations will be flagged and reported to other government agencies for further investigation and necessary punitive actions,” he added.
According to him, there is an urgent need to review the capital structure and working capital requirement of the advertisement agencies in line with economic realities and capacity building programmes of ARCON.
“ARCON is currently in talks with the Heads of Advertising Sectoral Groups (HASG) and other relevant stakeholders on the minimum capital requirement for registration and license as an advertisement agency. Regulatory guideline will be issued as soon as position is taken on this,” Dr. Fadolapo said,
On the use of the local talents, ARCON reiterated that it will continue to insist that Nigerians should be considered as primary in all advertisements targeted at the Nigerian market. Use of foreign models and voices are banned except where it is inevitable.”
“Use of foreign models and voices are banned except where it is inevitable. In this case, application for variation should be formally addressed to the Director General with detailed explanation of the rationale for the use of the foreign talent. Approval is not automatic. If you are selling your product to Nigerians, use Nigerians in your advertisement,” he said.
Other reforms include the following: creating a data bank for agencies, where ARCON is conducting a nationwide audit of advertising agencies to build a comprehensive data bank. Fadolapo announced that only licensed agencies will be engaged, and a directory will be published after the audit.