JC DECAUX backs-down, begs OAAN for membership
After three years of grandstanding and unwarranted prevarication, JC Decaux, a Paris based globally acclaimed outdoor advertising firm and its local partner, Grace Lake Partners have finally backed down from their high-horse as they have indicated intention to formalise and regularise the company’s business registration papers with the appropriate regulatory authorities.
The global outdoor company which has for a long while prevaricated and dragged feet on registering its business operations legally and procedurally was alleged to have written a formal apology letter to the Outdoor Advertising Association of Nigeria (OAAN), an umbrella body of all registered outdoor companies in Nigeria.
Recall that JC Decaux, a leading global OOH company, entered into the Nigerian Out-of-Home market in 2014, partnering with a local investment firm, Grace Lake Partners, allegedly owned by the serial investor and entrepreneur, Mr. Ladi Delano. However, there has been no proper registration for its business operations as an OOH company with the Corporate Affairs Commission. Despite this legal lapse, the company went into business taking most juicy multi-national advertising accounts using its pedigree and network amongst expatriate Chief Executive Officers of the blue chip companies.
Aside that, the company which entered the local out-of-home market with huge funds in foreign currency, dabbled into investment of high-cost OOH infrastructural facilities and street furniture, thereby igniting more competitive fire in the sector.
Alleged to have gotten the full backings of the former Lagos State Governor Akinwunmi Ambode, the company further created enmity for itself as it went on an unbridled acquisition of strategic billboards’ locations hitherto approved and operated by local competitors by different and respective regulatory agencies.
Specifically, according to industry sources, ‘’JC Decaux has since its entry into Nigeria resorted to various unethical business practices which are against global best practices or even the relevant law of the land. The company aided by its access to funds and deep ties with government has been able to outmuscle local operators and shut them out of potential business opportunities.’’
According to a report on COMPLETENEWS, an online news platform, MediaWorth, a local OOH firm which is now the complainant has recently been at the receiving end of JCD’s alleged illegality in Nigeria. Established in 1994, MediaWorth has over time made huge investment into its outdoor operations in the country. But the company now faces a bleak future following JCD’s takeover of its site in Lagos.
In a statement of claims obtained by COMPLETENEWS, it was revealed that sometime in 2012, MediaWorth had embarked on strategic sites hunting and found the Oworoshoki end of the Third Mainland Bridge suitable for a proposed digital electronic billboard. It immediately applied to Lagos State Signage and Advertisement Agency (LASAA) for approval.
But LASAA in a letter dated 18th October, 2011 referred MediaWorth to the Federal Ministry of Works which is statue-empowered by the virtue of Federal Highways Act to grant approvals for right of way on Federal roads. Consequently, an application was made on 22nd, February, 2012 by the local advertising firm to the Federal Ministry of Works. The Nigerian agency received an approval on 12 March 2012 and was asked to pay N2 million to the federal government coffers.
MediaWorth made the payment and began mobilising men and materials to the site. But not long after it commence construction on the site, the Nigerian company received a stop-work order from the Lagos State Ministry of Environment and later Ministry of Town Planning and Urban Development, citing public safety concerns.
While MediaWorth was still in the process of getting the controversial order lifted, it was gathered that LASAA revoked the approval initially granted. At this stage, according to court papers filed by MediaWorth, it had invested over N150 million. The Nigerian agency also claimed it was still indebted to the tune of $100,000 to its technical suppliers
MediaWorth also said that after the alleged illegal revocation of its site, armed policemen invaded the property to destroy its erected structures. It also stated that the site had been illegally hijacked and handed over to JC Decaux to construct an LED board in the guise of public safety.
Meanwhile, JC Decaux in a counter affidavit deposed before the Federal High Court, Ikoyi, Lagos, initially claimed to have gotten necessary approvals from relevant government agencies, including the Federal Ministry of Works.
However, upon discovering that the Federal Ministry of Works, which is the first defendant in the case denied issuance of approval to any advertising firm other than MediaWorth, J.C Decaux recanted and claimed it acted in error and therefore did not have FG’s approval. By law, only the Federal Ministry of Works can give approval for right of way on Oworoshoki end of the Third Mainland Bridge and Federal Highways across Nigeria.
Interestingly, MediaWorth is not the only Nigerian OOH agency engaged in a legal tussle with JCD, the French company has also been dragged to court by Moving Media for alleged usurpation of site. However, the foreign firm has resolved the crisis it has with Moving Media. While the multinational company also has a pending court case with Outdoor Advertising Association of Nigeria (OAAN).
It will be recalled that the Outdoor Advertising Association of Nigeria (OAAN) had instituted a suit at the Federal High Court in the Lagos Judicial Division against JC Decaux over alleged illegal and improper business registration to practice out-of-home advertising business in the country.
In the suit filed 19th February, 2018, with the File No. FHC/OK/249/19, OAAN the plaintiff joined as Defendants, JC Decaux, Corporate Affairs Commission and Advertising Practitioners Council of Nigeria (APCON) and is seeking the following reliefs:
DECLARATION that the 3rd Defendant was not validly incorporated by the 1st Defendant pursuant to the provisions of the Companies & Allied Matters Act.
A DECLARATION that not having been validly incorporated in Nigeria, the 3rd Defendant cannot practice the profession of advertising and in particular, outdoor advertising, and is therefore not entitled to a licence or other authorization to practice in the outdoor sector of the profession of advertising in Nigeria from the 2nd DER of the honourable court setting aside or directing the 1st Defendant to set aside the incorporation of the 3rd
AN ORDER of perpetual injunction restraining the 2nd Defendant from issuing a licence or other authorization to the 3rd Defendant which would permit it to practice the profession or business of outdoor advertising in Nigeria.
AND the determination of the following questions:
Whether the 3rd Defendant was validly incorporated by the 1st Defendant pursuant to the provisions of the Companies & Allied Matters Act?
Whether the 3rd Defendant not having been validly incorporated in Nigeria, can lawfully practice in the outdoor sector of the profession of advertising in Nigeria?
Whether it would be in the interest of the rule of law for the honourable court to set aside or direct the 1st Defendant to set aside the incorporation of the 3rd Defendant and restrain the 2nd Defendant from granting a licence or other authorization to the 3rd Defendant to practice outdoor advertising in Nigeria?
An affidavit sworn to support of the originating summons by Chief Folusho Akinbobola on behalf of Incorporated Trustees of Outdoor Advertising Association.
However, realising that it may not win the many battles it has been fighting on different fronts, JC Decaux it was reliably gathered by MARKETING EDGE may have finally succumbed to reason and logic as it waves an olive branch to OAAN.
Reliable and authoritative industry sources hinted MARKETING EDGE that truce may be on the way sooner than envisaged as both OAAN and the company have been genuinely engaged in frank and sincere conversation. According to sources, OAAN team negotiating with the company was said to have presented a long list of demands and conditions for JC Decaux as a prerequisite for final resolution of the face-off.
Some of these conditions, MARKETING EDGE can authoritatively report include payment of a yet to be stipulated fine by the foreign firm, proper registration with OAAN and payment of all dues since arrival into the country, withdrawal of appeals on litigations in court and change of name and business operations within ethical and statutory confines as may have been stipulated in the constitution and other regulatory bodies.
Feelers emanating from the industry have revealed that the foreign company appears sober and apologetic, as a result ready and willing to abide by most if not all of the conditions stated.
“We could see that JC Decaux is for once sober and reflective. The firm appears apologetic and sounds convincing about its intention to toe the line this time around,” explained a very top OAAN source who would not want to be quoted.
The source stated that though OAAN was not completely convinced about JC Decaux, what it knew was that from the tone and language of its apology letter, it was very clear the firm wanted to play ball.
“Again, we are not unmindful of the fact that there is a change of baton in Alausa, the seat of Lagos State government. So, all of these may have informed the humble posturing and gentlemanly resolve of JC Decaux now that their backers in government are no more,’’ the source hinted.
Meanwhile, all efforts to get the comments and reactions by JC Decaux management proved abortive. A very reliable source and former ally of JC Decaux said it was unaware of the latest truce trip with OAAN, adding that all counsel and advises earlier given to the firm hitherto were turned down.
As it were, all stakeholders in the OOH sector are eagerly awaiting the revert by the local partners which told the negotiating team that it would go and table the proposed resolution plans and conditions before its parent company in Paris.
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