Corporate Practice




ARCON PROCLAMATION ON REGISTRATION AND LICENSING REGIME IN THE ADVERTISING INDUSTRY


Pursuant to the powers vested in the Advertising Regulatory Council of Nigeria (ARCON) to regulate the practice of advertising and administer the Code of Advertising Practice & Sales Promotions, etc., the Council sets out the following licensing guidelines and requirements for the purpose of fair, efficient and orderly practice of advertising business. Consequently, the Council makes the following proclamation, which shall take effect on the 1st day of January 2013:-


(A) Business License Regime
All categories of advertising organisations/firms as listed in the Code that engage in the business and practice of advertising for the purpose of gains/profit shall be licensed by ARCON, with the exclusion of advertisers. The license shall be renewable every three years in accordance with the requirements of the Code.  No organisation shall operate the business of advertising without this licence.

(B) Each firm of practitioners shall have its area of specialisation defined, which shall be the basis, and scope of licence granted to such firm. A firm that is to be licensed in a particular area of specialisation/advertising business is expected to show that it has the requisite set of qualifications, skills and competence required in a given field.

(C) Where a firm or company decides to operate outside its designated/licensed area of specialisation, the concerned organisation shall be required to properly set up a firm and register the new firm that is intended to offer the designated services. For purposes of illustration only, an advertiser which conducts or intends to conduct the business of advertising or media agency should comply with the requisite licensing requirements of firms licensed to operate in that specialised field of advertising business including properly establishing and registering a firm to engage in such distinct field of specialisation or services. Such a firm must be approved and certified by ARCON before it commences operations.

(D) Guidelines for Licensing
Advertising Organisations shall be classified as follows:

  • National Agency

This shall apply to advertising organisations whose total equity participation by Nigerians is equal to or above 74.9% or aggregate foreign investment in equity is equal to or below 25.1%.

  • Foreign Agency

This shall apply to advertising organisations whose total equity participation by Nigerians is equal to or below 25.1% or aggregate foreign investment in equity is equal to or above 25.2% (up to 100%).  Foreign Agency shall practice advertising targeted at market outside the shores of Nigeria.

For any organisation to be licensed, the Chief Executive Officer must be a registered practitioner at the level of rpa. However, for local organisations, under special consideration, the licensing committee may accept Associate registration, arpa.

Except for support service department, all heads of operational departments in the organization must be registered practitioners at a level not lower than Associate member, arpa. However, for purposes of media organisations, the Chief Executive Officer does not need of necessity to be an advertising practitioner. Facilities and staffing must be considered adequate for the level of licensing.

ARCON will operate two windows for business registration/licensing.

(a) Window1

Member organisations of recognized sectoral groups shall be required to obtain a reference letter from the sectoral body recommending and confirming their suitability for the business licence. The letter of reference shall detail particulars showing compliance with requirements for practicing in the targeted field.

Where an organisation operates within another regulatory Law of the Federal Republic of Nigeria administered by another government agency e.g. NBC, NCC, NFC, NPC, etc., such organisation shall be required to obtain a formal letter from the government establishment that administers the Law and shall be qualified under Window 1.

All organisations shall also pay the requisite licensing fee as stipulated in the schedule to this Proclamation.

(b)Window 2

Where any of the aforementioned advertising outfits or organisations is not a member or affiliated with any recognized sectoral group, then such an outfit or organisation which intends or already prior to this proclamation conducts advertising business in the specialised area being regulated; shall provide the following:

  1. Name and contact details of the applicant agency i.e. (this shall include but will not be limited to office address, telephone numbers, email address, website etc.).
  2. Copy of Registration documentations for the special purpose vehicle floated for the purpose of the specialised advertising business as well as comprehensive particulars of Owners/Promoters/Directors’ details as the case may be.  This information/documentation must include amongst other details, and as the case may be:
    1. Copy of Certificate of Incorporation.
    2. Copy of Memorandum and Articles of Association.
    3. Evidence of share subscription and distribution.
    4. Copy of documents relating to particulars of directors in the case of a company.
  3. Names and details of management staff.  This shall include but will not be limited to:
    1. Names and qualifications of management staff, including evidence of ARCON registration and certificate.
    2. Details and evidence of working experience of management staff.
  4. Financial report.  This shall include but will not be limited to the current Audited Report (where applicable).
  5. Tax Clearance Certificate where applicable.
  6. Letter of compliance from the Nigeria Pension Fund on compliance with relevant sections of the Pension Act (for Company already in operation).
  7. Employee Benefits Insurance:  Evidence of employees’ retirement saving plan, group insurance plan, workers compensation from relevant organisation and government agencies.
  8. In addition an organisation will be required to produce a bankers’ credit guarantee from a Nigerian bank acceptable to ARCON in the sum of N200 million for a National agency and N500 million for a Foreign agency.
  9. National and Foreign categories applicants shall also be required to produce and submit an Agency Business Insurance to the tune of N200 million for a National agency and N500 million for Foreign agency from a Nigerian insurance company acceptable to ARCON.

(E) Scope of Practice

  1. In order to encourage development cohesion, accountability and mutual wellbeing of the profession, ARCON encourages all competent individual practitioners to practice within a recognised firm in a recognised area of specialisation without prejudice to the freedom of individual and competent practitioners to practice in other areas of advertising.  All firms that engage in the practice of advertising or advertising functions for the purpose of gains or benefits (except Advertisers) shall be licensed by ARCON.
  2. Practitioners shall endeavour to renew their practice fee on or before March 31st of every year.
  3. Non-renewal of practice fee is an offence and shall attract sanctions including delisting where appropriate and other sanctions.
  4. A practitioner shall not engage in a designated area of specialisation except the firm of practitioners in which he/she is engaged is licensed to carry on business in such area(s).

(F) Foreign Practitioners

Foreign practitioners shall be welcome to practice the profession in Nigeria; however, such practitioners shall be certified and licensed by ARCON. In addition to the requirement of the Membership Committee of ARCON, such practitioners must show:

  • Evidence of work permit obtained from the relevant agencies like the NIS, etc. relevant visa, etc.
  • A letter of attestation from the organisation intending to employ the expatriate on:
    1. The genuineness of the offer.
    2. The remuneration package and conditions as comparable to those offered to Nigerians of the same status and position.
    3. The foreign practitioner is filling a labour shortage.
    4. The employment of foreigner will directly impact or create new job opportunities or help retain jobs for Nigerians.
    5. The employment of the foreign practitioner will assist in transferring new skills and knowledge to Nigerians.
    6. The hiring of foreigner will not affect the employment of Nigerians negatively.

For more enquiries, contact:
Mrs. Abigail Momoh, arpa
Group Head, Corporate Practice
08022577500, 09155791424