The Manufacturers Association of Nigeria (MAN) has raised strong objections to the newly introduced financial charges under the amended Financial Reporting Council of Nigeria (FRCN) Act, warning that they could threaten business survival and undermine the federal government’s ease of doing business agenda.
In a statement, MAN’s Director General, Segun Ajayi-Kadir, described the new charges as “astronomical” and particularly harmful to non-listed manufacturing firms. Under the amended FRCN Act, non-listed companies are now classified as Public Interest Entities (PIEs) and subjected to annual fees based on their turnover. The revised law stipulates that companies earning more than N10 billion annually could pay up to 0.05% of their turnover, significantly increasing the financial burden on manufacturers.
Ajayi-Kadir noted that, previously, publicly listed companies paid a maximum of N1 million per year to the FRCN. However, under the new rules, that figure has skyrocketed to N25 million. Worse still, non-listed firms—previously excluded—now face uncapped fees linked directly to their revenue, regardless of whether they are profitable.
Beyond the financial strain, the law also introduces harsh penalties for non-compliance. Companies failing to meet payment obligations could face a 10% monthly penalty, while their CEOs risk up to six months in prison. Ajayi-Kadir criticized this provision as excessive, arguing that regulatory non-compliance typically results in fines or administrative penalties, not imprisonment.
“The strict penalties and potential imprisonment suggest the law takes on a criminal nature, which is concerning. Generally, non-payment of fees results in fines, not jail terms, unless there is intent to defraud or evade payment in defiance of the law,” he stated.
MAN warned that implementing these charges at a time when businesses are grappling with inflation, high operating costs, and currency depreciation could further discourage investment in Nigeria’s struggling manufacturing sector. Ajayi-Kadir stressed that manufacturers are already overburdened by multiple taxes and levies, and this latest financial obligation would only make matters worse.
The association urged the FRCN to immediately suspend the implementation of the fees and reconsider their alignment with Nigeria’s broader tax reforms. MAN emphasized that the federal government has been working to streamline regulations, harmonize taxes, and create a more business-friendly environment, and these new FRCN charges directly contradict those efforts.
“As the umbrella body for manufacturers in Nigeria, we implore the FRCN to reconsider these charges in light of ongoing tax reforms. The council should pause the implementation of these fees to avoid undermining the productive sector at a critical time,” Ajayi-Kadir stated.
The manufacturers’ group reiterated that halting the enforcement of these new financial obligations would support the federal government’s commitment to fostering economic growth and sustaining local industries.
