The Manufacturers Association of Nigeria (MAN) has strongly opposed the new financial charges imposed on private companies by the Financial Reporting Council of Nigeria (FRCN) under the recently amended FRCN Act.
In a statement issued by Segun Ajayi-Kabir, the Director General of MAN, the association expressed concern that these charges pose a serious threat to the survival of businesses and contradict the government’s ease of doing business agenda.
Ajayi-Kabir described the charges as “astronomical,” particularly noting that non-listed manufacturing companies—many of which are MAN members—are now classified as Public Interest Entities (PIEs) and subjected to substantial fees.
He highlighted a new section introduced in the FRCN Amendment Act, 2023, which mandates annual charges for non-listed entities based on a percentage of their annual turnover. For companies with a turnover exceeding N10 billion, the maximum charge is 0.05% of their turnover.
“For publicly quoted companies, the maximum fee was previously N1 million per year but has now been increased to N25 million,” Ajayi-Kabir stated. “More concerning is that for non-listed companies, who were previously exempt, there is no cap, and the fee is tied to turnover, regardless of whether the company is profitable or not,” he added, citing Section 33 of the FRCN Act 2023.
Furthermore, Ajayi-Kabir pointed out that the Act imposes severe penalties, including a 10% monthly fine for non-payment and the potential for CEOs to face up to six months in prison for defaulting. He criticized the criminalization of non-payment, arguing that typically, such infractions result in fines or regulatory penalties, not imprisonment.
MAN warned that implementing these charges, especially during challenging economic times, could discourage investment in Nigeria’s manufacturing sector. The association has called on the FRCN to suspend the implementation of these fees and reassess their compatibility with Nigeria’s ongoing tax reform initiatives.
