₦1bn debt: ARCON wields big stick against 9mobile

The Advertising Regulatory Council of Nigeria (ARCON) has announced a full-scale investigation into a staggering ₦1 billion advertising debt allegedly owed by Emerging Markets Telecommunications Services Limited, trading as 9mobile.

Also Read: Do young creatives still need to work for ad agencies in the age of social media?

The telco company that entered Nigeria’s market as Etisalat over a decade ago is a member of the Advertisers Association of Nigeria (ADVAN).

ARCON received petitions alleging that 9mobile defaulted on long-standing financial obligations to agencies that executed various advertising services on its behalf.

The regulatory council stated that the most disturbing part of the situation is that the brand reportedly signed on another media buying firm to handle new campaigns without settling its debt to existing creditors. ARCON considers this practice both unethical and potentially unlawful.

In a statement signed by Dr. Lekan Fadolapo, ARCON’s Director General, the council declared: “ARCON will investigate the movement of the account from the agencies owed to the new agencies briefed to ascertain compliance with disengagement protocol as well as possible breach of ethical procedure.”

The regulatory body also expressed deep concern about the brand’s apparent disregard for industry disengagement protocols, which require a brand to formally settle accounts and issue clearance before handing advertising duties to a new agency.

The statement continued: “By the workings of the advertising ecosystems, advertising debts are beyond agencies, they belong mostly to media houses and third-party vendors/suppliers who are significantly affected by the indebtedness with multiplier effect on their cash flow and operations.”

In this regard, ARCON vowed to scrutinise how 9mobile moved its account from the affected agencies to new ones, ensuring it followed proper procedures and upheld ethical standards.

As part of its next steps, ARCON disclosed its intention to collaborate with relevant government agencies for further investigation.

“This is an economic sabotage capable of inhibiting the Federal Government policy of inclusive industry growth and development of the Nigerian advertising industry.

This is to reiterate that the Nigerian advertising industry payment threshold remains 45 days.”

The statement further read that “ARCON will take all necessary actions to eradicate unfair advantage, unethical competition and unequitable policies between relevant stakeholders in the

Nigerian advertising industry, ensuring adherence to payment threshold, industry credit policy, protection of copyright/intellectual property ownership.

This is as well as compliance with the Advertising Industry Standard of Practice (AISOP).”