ARCON to Collaborate with NBC to Tackle Advertising Industry Debt
The Minister of Information and National Orientation, Alhaji Mohammed Idris, has issued a directive to the Advertising Regulatory Council of Nigeria (ARCON) to collaborate with the National Broadcasting Commission (NBC) and advertising sector stakeholders in a bid to enforce stricter payment discipline and ensure zero tolerance for advertising industry debt. The directive underscores the importance of payment compliance for the sustainable development of Nigeria’s media and advertising industry.
ARCON has reaffirmed its commitment to enforcing the new policies, with Dr. Olalekan Fadalope, ARCON’s Director-General, stating, “ARCON will ensure full implementation of the Honourable Minister’s directive in sanitising the advertising and media industry, ensuring prompt payment for advertising services, and adherence to professional and statutory standards.”
The directive also includes measures such as a Credit Policy and Payment Threshold, Agency Disengagement Protocol, and Alternative Dispute Resolution, aimed at fostering transparency and discipline within the industry.
In line with global best practices and as part of the Advertising Industry Standards of Practice (AISOP), payment for advertising services should be made within 45 days; failure to do so will attract interest or a covering interest rate. All Media Purchase Orders (MPOs) and Local Purchase Orders (LPOs) for media and advertising services are expected to comply with this policy. All parties and advertising stakeholders must be transparent in their dealings to ensure a structured and disciplined payment process within the Nigerian advertising ecosystem, the statement reads.
Regarding the agency disengagement protocol, the statement notes that:
“Advertisers and business owners are free to discharge, disengage or terminate the agreement/contract with their advertisement agency. However, where an advertiser decides to disengage its advertisement agency (full service, creative, media buying, digital or OOH), the advertiser must ensure a detailed reconciliation and resolution of all outstanding financial obligations with the outgoing agency before proceeding to brief a new advertisement agency. The outgoing and incoming advertisement agencies are required to formally engage and back-check for possible ethical or financial breaches that may encumber the new accounts. This conversation and engagement are not only important but also statutory.”
ARCON further explained that it has established an Alternative Dispute Resolution desk to resolve industry issues. “Following the directive of the Honourable Minister, ARCON has set up an Alternative Dispute Resolution desk for neutral third-party mediation, conciliation and arbitration in order to reach harmonious settlement of industry disputes. This is considered very important and crucial, as it will promote faster and more amicable resolution of industry conflicts.”
It emphasised that:
“All stakeholders and the advertising community are enjoined to adhere to the business framework outlined above, which seeks to improve and strengthen the ecosystem.”
Similarly, the Minister stressed that these steps are vital for protecting media houses, attracting new media investments, and promoting industry stability.