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LASAA and the burden of vacant billboards

by Goddie Ofose
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Few years ago, when the Lagos State Signage and Advertisement Agency (LASAA) slammed a 10 billion naira penalty on some members of the Outdoor Advertising Agency of Nigeria (OAAN) for vacant and inactive billboards, many thought the regulator would back down after several pleas and intervention from concerned stakeholders. But the pleas apparently fell on deaf ears, as the agency stuck to its guns, insisting that the Out of Home companies should stop sulking and pay the accumulated charges. So, the debts continue to hang on these firms, thus, preventing them from earning revenues from the billboards that have regrettably remained vacant and inaccessible.

LASAA’s action is predicated on the statutory rules and enabling law that states that 12.5% of the revenue from billboards with clients campaign can only be charged by LASAA.  The law under item 39(1) states that “The lease of advertisers of commercial space leased billboards or sign periodical lease or rent will be subject to a fee that is equal to 12.5 percent of the rental charges by the “Leasing Company”. Despite the clarity of this clause, LASAA has, over the years, jettisoned its application, and has, in flagrant, violation of its own laws, enacted a regime of indiscriminate and arbitrary taxation and levies.

Speaking to our correspondent, an OAAN member, who does not want his name mentioned said, “We are obviously not happy with the current situation as it is hampering business for us. We are saddened that our efforts and appeals to LASAA over the years have yielded no result. With the huge debts dangling on our heads, LASAA has withheld assent to renewing our rent permits, thereby, putting our business in serious jeopardy”.

“The current Managing Director, Adedamola Docemo, upon resumption had promised to strengthen the bond between LASAAA and OAAN through quarterly engagement meetings. As a matter of fact, when the association paid him a courtesy visit after his appointment, we tabled all our concerns to him. He assured us of his desire to address three key issues affecting the outdoor industry and the practitioners which are innovation, standards and debt management. But, as far as the issue of debt management is concerned, it is still a sore point. We are yet to get what we think is objectively fair in terms of discounts”.

Meanwhile, the Managing Director, in a monitored interview on this issue, said, “Part of the handover notes I got was clear and explicit on the recent rate reduction the agency gave to owners of billboards, both OAAN and non-OAAN members. My stand is that, we will look at the vacant board discount policy and possibly fine-tune it for better clarity. I am aware my predecessor gave discounts of varying degrees to outdoor advertising practitioners in the last two years.”

He continued, “We are currently reviewing documents, so, as to give succor to all. I want to assure you that conversations are going on at the moment. If a board is vacant, LASAA will play its role by ensuring that value is given back to the industry; value in the sense that, we will create a demand and supply system that will work for the industry. We are not denying the fact that we have our revenue objective, but we will ensure that our interest does not jeopardize the value derivable from the industry.”

He also added, “So, we will have engagements with OAAN. By this, I mean, practitioners must also be ready to let go of some billboard structures that are not yielding dividends, rather than to continue to incur debts. They must be ready to embrace the future decisively, cut their losses by doing away with selfish business ideas”. “To achieve this, we must continue to engage and encourage outdoor advertising practitioners to look at their business models and indebtedness to our agency, and take strategic business decisions to move their businesses forward. I assure you that, even, though, we have discounted our rates in the last one or two years, we will look at vacant board discount again, and we will establish a standard process for claiming discounts on such boards in future”.

A lawyer and an outdoor enthusiast, Timothy Angus, feels LASAA needs to be more rational in the way it administers outdoor operations, especially, as it concerns payment of debts incurred by OAAN member companies via vacant billboards. He noted that the agency’s 30% rate reduction was rather inadequate and incomplete because it fails to attend to the highly controversial past debts incurred by these operators. He added that it is doubtful that the companies heavily weighed down by these fabricated debts would be able to emerge from its present state of recession and depression, if the disputed old debts are not resolved.

He decried the report that the interests of members of OAAN were being subverted to allow for the grand entry of a foreign agency into the state, which is in contravention of the state advertising laws. He urged the agency to tow the path of transparency, fairness and rationality in the best interest of the outdoor sector in particular and the advertising industry in general.

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