JC Decaux battles survival over alleged ‘illegal’ biz operations
Feelers emanating from the hotly competitive out-of-home business environment in Nigeria have revealed that litigations arising from controversial, alleged unethical and illegal processes and procedures may cripple the business activities of JC Decaux in the country.
Impeccable industry sources have revealed exclusively to MARKETING EDGE that JC Decaux, the world acclaimed biggest outdoor advertising firm and its local agents are currently swimming against the tide with the whirlwinds of litigations over alleged illegal business registration in Nigeria, flagrant flouting of advertising regulatory rules, outright impunity on securing relevant and statutory approval permits and unfriendly and neo-colonialist approach to business pursuits.
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, OAAN the plantiff joined as Defendants, JC Decaux, Corporate Affairs Commission and Advertising Practitioners Council of Nigeria (APCON). In the suit with the File No. FHC/OK/249/19, OAAN 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 states that:
Since the legal battle began, JC Decaux Nigeria Ltd has been running from pillar to post. It has made several legal acrobatic dance steps and had fallen on several occasions. When the hearing of the case commenced, OAAN was able to argue the fact that one of the two companies purportedly being touted by the global outdoor agency, Continental Outdoor Media Africa (COM) in South Africa as revealed in the sworn affidavit was neither properly registered in Nigeria, nor in South Africa. Rather, the outdoor association body alleged that it is only Grace Lake Nigeria that was duly and validly registered in the country.
Consequently, OAAN was of the view that “In Nigeria, any Two or More persons (natural or juristic) may form or incorporate a company by complying with the requirements of the Act and at least 25% of the authorized share capital of a company must be taken up by the subscribers.
One person, whether natural or corporate cannot incorporate a company under the companies & Allied Matters Act. It also explained that “the memorandum and Articles of Association of the 3rd Defendant was signed and subscribed to by only one (1) person, Olayimika Phillips who took up 0.0000001% of the authorized share capital of the company. The battle has been fierce as all attempts by JC Decaux Nigeria Ltd. to perfect the alleged initial errors are being countered. Smarting from some of the brick walls, the foreign firm was alleged to have sought a partnership with Horizon Media, a local OOH advertising agency which recently joined OAAN, the umbrella body of the Out-of-Home companies.
Again, upon investigation by OAAN, it was discovered that JC Decaux was not a director on the board of Horizon Media owned by Mr. Niyi Oyedeji and his wife. It was also alleged that as of now, both Horizon Media and JC Decaux are yet to enter into any contractual agreement or partnership agreement between the two. Informed industry sources insist that the two were perhaps still having talks on a possible alliance, a development which was argued could not be a genuine ground to confer legality to all the alleged illegalities that the foreign agency is being challenged in court.
It was also gathered that all efforts by the outdoor company to get a soft landing through APCON was thwarted. During one of the hearings, APCON lawyer was said to have initially attempted to frustrate OAAN, its sectoral body by claiming the association has no locus standi to regulate advertising but when OAAN lawyer Mr. Kunle Tuyo, Esq. countered by reminding APCON of its Code & Ethics of advertising practice, the regulatory agency chickened out. Since then, APCON has failed to make further appearance in court for the embattled company. It should be noted however that APCON’s tactical withdrawal from this case signifies an important landmark in the dimension the case has taken.
Sensing that it may not win the battle through litigations, JC Decaux again wrote a letter to OAAN in October this year notifying the association of its intention to become a registered member of the body as well as inviting officials of the association to its formal public launch. This rapprochement was tactically rejected by OAAN which advised the defendant to go and perfect its registration documents at the Corporate Affairs Commission (CAC). The association hinted it was prepared to see to the logical conclusion of the legal battle, pointing out that there is no way it would buckle in the middle of the game. An intervention by CAC too could not safe the day for JC Decaux as OAAN was armed with facts and figures against the defendants on statutory requirements for a foreign company to establish business in Nigeria.
Following the various hiccups that have attended its defence so far, the foreign outdoor company appears to be in a limbo and a fix. Although spirited efforts are being made by the counsel to the defendant, none of these seemed to have turned the apple cart on its client’s side. So far, the case has been adjourned indefinitely thereby leaving industry players in a state of bewilderment. While judgement is being awaited, the company has continued to ply its trade albeit ‘illegally’ and ‘unconstitutionally’. A senior advertising practitioner in the OOH who pleaded anonymity told MARKETING EDGE that “we are waiting patiently for the resumption of hearing in the case”, adding that since nobody has filed a nolle prosequi, in the case, there is no way the battle will be discontinued.
When contacted, OAAN President, Mr. Idowu Adedoyin said his group will see to the logical conclusion and completion of the case. “We have started the legal race, we cannot bow out at this point and we are optimistic in getting justice through the law court”, the OAAN President assured. Also speaking in a similar vein, an outdoor advertising practitioner, Mr. David Bejide said that “OAAN hopes lie in the hands of the court as the Nigerian judges would not open their eyes and allow any foreign company to come into the country and start flouting its rules with impunity”. He described the actions of JC Decaux Nigeria as a clear violation of the Nigerian statutory laws on business registration and operations”. Meanwhile, all efforts to speak with Mr. Ladi Delano of Grace Lake Nigeria proved abortive as his phone was switched off when contacted. Similarly, a staffer of JC Decaux Miss Lolade Owoshere has equally refused to pick her phone calls or responds to our enquiries.
The OAAN legal fight with JC Decaux is the third legal battles that JC Decaux have been battling with. The foreign company was first confronted by Moving Media who instituted legal action against the foreign company by displacing it at its approved sites. The case was tactically withdrawn and settled out of court after some stakeholder interventions. The foreign OOH company has also been taken to court by Media Worth seeking legal redress over usurpation of billboard sites. Earlier this year, JC Decaux narrowly escaped another legal tango with Touch Points Ltd, a bus-shelter OOH which has gotten franchise for Lagos State bus stops and parks. It was gathered that JC Decaux had attempted to poach Touch Points franchise but met its match in the highly connected and highly networth company.
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