Keep up with the latest news and be part of our weekly giveaways and airtime sharing; follow our WhatsApp channel for more updates. Click to Follow us

Telecommunications operators in Nigeria, under the umbrella of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), have urged the Financial Reporting Council of Nigeria (FRC) to reconsider the new yearly dues imposed on private companies. ALTON claims that the new dues will “kill businesses” and has expressed deep concerns about the review of the yearly payment structure under the Financial Reporting Council Amendment Act 2023 (FRC Act) ¹.

The new payment structure is based on a percentage of the yearly turnover of member companies rather than the previous maximum cap of N1 million. According to ALTON, this will pose significant challenges for operators, especially in light of the prevailing harsh economic conditions in the country.

ALTON highlighted the huge disparity in the amounts payable as annual fees by entities having the same turnover figure. For instance, a publicly quoted company with a market capitalization of N1 trillion will pay N25 million as annual dues, while a non-publicly quoted company will pay 0.05% of N1 trillion, amounting to N500 million.

To address these concerns, ALTON suggested two alternatives:

– *Computation of yearly dues based on profit, not revenue*: ALTON argued that this would be more fair, as telecommunications companies deploy significant capital towards operations and bridging the telecommunications gap, resulting in a great disparity between revenue and profit.

– *Reintroduction of a pre-determined cap on FRC dues*: ALTON noted that the new Act computes yearly dues payable by public companies based on their market capitalization, subject to a predetermined cap, which is more favorable to publicly quoted entities.

ALTON has requested a meeting with the FRC to discuss these issues in detail and explore alternative solutions or payment arrangements that would be more manageable for its member companies.

ALTON’s Chairman and Executive Secretary, Gbenga Adebayo, and Gbolahan Awonuga, respectively, emphasized the need for a review of the new dues, stating, “We are committed to working constructively with the FRC to find a mutually acceptable resolution to this matter.”

In a letter dated September 13, 2024, addressed to the Executive Secretary/CEO, FRC, Dr. Rabiu Olowo, ALTON expressed its concerns about the new payment structure. Although the FRC acknowledged receipt of the letter, it has yet to respond.

ALTON noted that the telecommunications industry in Nigeria has been facing numerous challenges, including rising operating costs and foreign exchange fluctuations. The current payment structure, ALTON argued, will place an undue burden on its members, potentially impacting their ability to maintain operations and continue providing critical services to the Nigerian public.

“We respectfully request that you use your good office to change the basis of computing the annual dues payable based on either of the options mentioned above,” ALTON stated. “We believe that this will help alleviate the financial burden on our member companies and ensure the continued growth and development of the telecommunications industry in Nigeria.”.

Please don’t forget to “allow the notification” so you will be the first to get our gist when we publish it. 
Drop your comment in the section below, and don’t forget to share the post.