In a decisive move that underscores the Federal Government’s tightening grip on regulatory compliance, the Corporate Affairs Commission (CAC) has issued a stern six-week ultimatum to all unregistered and non-compliant businesses operating in Nigeria to regularise their operations — or risk criminal prosecution.
In a circular released on Tuesday from its Abuja headquarters, the CAC made it clear that it is no longer business as usual for entities circumventing the Companies and Allied Matters Act (CAMA) 2020, the legal framework governing corporate registration, disclosure, and governance in Nigeria.
“Legal action will be taken against any Company, Limited Liability Partnership, Limited Partnership, or Business Name found operating without registration or using an identity different from its registered name,” the Commission stated emphatically.
Why This Matters: Enforcement Era Begins
This move signals a shift from regulatory leniency to active enforcement — and has immediate implications for thousands of informal businesses, SMEs, and even large entities operating outside or on the fringes of compliance.
In a country where an estimated 65% of economic activities happen in the informal sector, the CAC ultimatum is not merely administrative — it’s a potential game-changer. Analysts say it’s part of broader efforts to widen the tax net, deepen corporate transparency, and sanitise Nigeria’s complex business landscape.
At the heart of this crackdown are several key provisions of CAMA 2020, including:
- Section 863: Makes it a criminal offence to carry on business without registration or under an unregistered name or acronym.
- Section 729: Mandates display of registered business name and number at all premises and on all business communications — including letterheads, signage, adverts, and digital assets.
- Section 862(1): Prescribes penalties — including two years imprisonment and daily fines — for individuals who knowingly submit false information on statutory documents.
The Clock Is Ticking: What Business Owners Must Do Now
The CAC has urged all business entities — particularly those operating informally or under new/alternate names — to take immediate steps to comply. This includes:
- Proper registration or regularisation with the Commission
- Ensuring that the correct legal identity is reflected across all marketing, transaction, and legal documents
- Avoiding any misleading or unauthorised use of acronyms, brand aliases, or assumed names not officially registered
Failure to comply will not only attract sanctions, fines, and possible shutdowns, but also reputational damage and regulatory blacklisting — especially as inter-agency data sharing and digital enforcement tools become more integrated across the Corporate Affairs Commission, FIRS, NFIU, and other MDAs.
BRANDECONOMY Insight: Compliance is Now Strategy
This development is more than a legal update — it’s a wake-up call for Nigerian entrepreneurs, SMEs, and even high-flying startups that have prioritised market entry speed over formal structure.
Beyond avoiding fines and prosecution, proper business registration is foundational to credibility. It unlocks access to:
- Government contracts and grants
- Financial services and investor funding
- Brand protection and IP enforcement
- Legal standing and dispute resolution
In a business climate where trust, traceability, and governance are emerging as core strategic advantages, registration isn’t just a box to tick — it’s a competitive edge.
The Bottom Line:
With the CAC’s enforcement window now ticking down to mid-June 2025, the message is clear — operate legally or risk legal shutdown. Business owners who ignore this directive may soon find themselves on the wrong side of Nigeria’s emerging compliance regime.
