CAC Delisting Dormant Companies in Nigeria: What You Need to Know
CAC Delisting Dormant Companies in Nigeria: What You Need to Know
The Corporate Affairs Commission (CAC) in Nigeria has launched a significant initiative to clean up its corporate registry by delisting approximately 100,000 dormant companies. This move, announced on July 29, 2025, targets businesses that have failed to file annual returns or disclose beneficial ownership details for over a decade, as mandated by the Companies and Allied Matters Act (CAMA) 2020. Here’s everything you need to know about this development and how it affects your business.
Why Is the CAC Delisting Companies?
The CAC’s decision is part of a broader effort to:
Sanitize the Corporate Registry: Remove inactive or "ghost" companies that clutter the database and do not contribute to economic activity.
Enhance Transparency: Ensure compliance with anti-money laundering standards and improve disclosure of Persons with Significant Control (PSC).
Boost Accountability: Foster a reliable business environment by ensuring only active, compliant companies remain registered.
According to Registrar-General Garba Abubakar, nearly 90% of registered companies in Nigeria are dormant, highlighting the urgency of this regulatory action. This is not the first cleanup; in 2024, over 80,000 companies were delisted, with around 5,000 firms complying to avoid dissolution.
What Does This Mean for Affected Companies?
The CAC has issued a 90-day grace period starting from July 29, 2025, for affected companies to regularize their status. Here’s what you need to do to avoid delisting:
File Outstanding Annual Returns: Submit all pending annual returns within the 90-day window.
Update PSC Records: Disclose or update details of Persons with Significant Control as required by CAMA 2020.
Send Confirmation: Email proof of compliance to activation@cac.gov.ng to have your company removed from the delisting list.
The list of the 100,000 companies slated for delisting is available on the CAC website. Companies that believe they were mistakenly included can contest their status by providing documentation of compliance via email.
Consequences of Delisting
If a company fails to comply within the 90-day period, it will be:
Struck Off the Register: Deemed legally dissolved from the date of publication, losing its corporate status.
Prohibited from Operating: It becomes illegal to conduct business under the delisted company’s name, with transactions considered void under Nigerian law.
Subject to Reinstatement Challenges: Restoration requires a Federal High Court order, a costly and lengthy process.
Delisting can severely impact a company’s ability to open bank accounts, sign contracts, raise funds, or pursue legal action, underscoring the importance of prompt action.
How to Stay Compliant
To avoid future issues, businesses should:
File Annual Returns Promptly: Submit returns annually, regardless of profit or activity, as required by CAMA 2020.
Maintain Updated Records: Regularly update PSC and beneficial ownership details with the CAC.
Conduct Due Diligence: Verify the status of companies before entering transactions, as dealing with dissolved entities carries legal risks.
The CAC provides resources on its portal to guide companies through the compliance process, including step-by-step registration and filing instructions.
Why This Matters for Nigeria’s Business Ecosystem
This delisting drive aligns with Nigeria’s commitment to global best practices in corporate governance. By purging dormant entities, the CAC aims to:
Strengthen the accuracy of its database, making it a reliable resource for investors and regulators.
Reduce the risk of fraud associated with inactive companies often used as fronts for illicit activities.
Enhance Nigeria’s reputation as a transparent and accountable business environment, attracting more investment.
Take Action Now
If your company is on the CAC’s delisting list, act swiftly to regularize your status before the 90-day deadline expires on October 27, 2025. Visit the CAC website to review the list and start the compliance process. For businesses not currently affected, this is a timely reminder to maintain good standing with the CAC to safeguard your operations.
Stay informed, stay compliant, and keep your business thriving in Nigeria’s dynamic corporate landscape!
Sources: Nairametrics, Tribune Online, CAC Official Website
0 Response to "CAC Delisting Dormant Companies in Nigeria: What You Need to Know"
Post a Comment
Tell us what you think about this article?