CAC Struck Off 400,000 Nigerian Companies, Here Is why
CAC deregistered companies have taken center stage in Nigeria’s corporate landscape following the removal of over 400,000 inactive firms from the national business register. The large-scale cleanup, officially confirmed by the Corporate Affairs Commission, marks one of the most decisive regulatory actions in the country’s recent corporate history.
Explaining the move during a high-level briefing in Abuja, the Registrar General of the Commission, Hussaini Ishaq Magaji SAN, revealed that the affected entities were struck off after persistently failing to meet statutory obligations. Chief among these breaches was the failure to file annual returns for more than ten consecutive years, despite repeated warnings and public notices.
According to Magaji, the decision aligns squarely with the provisions of the Companies and Allied Matters Act 2020. Section 692 of the Act grants the Commission the authority to remove any company from the register if there is reasonable evidence that it is no longer carrying on business or has ceased operations entirely.
Several factors contributed to the mass deregistration. Many of the struck off firms had defaulted on annual filings for over a decade, strongly suggesting long term inactivity. Others ignored multiple notices issued by the Commission, even after being given opportunities to regularize their status during designated grace periods.
The cleanup was also driven by concerns over the misuse of dormant companies. The CAC identified many of the inactive entities as potential shell companies that could be exploited for money laundering, contract fraud, and other financial crimes. By removing them, the Commission aims to close loopholes that undermine financial transparency.
Magaji stressed that an inflated register populated by inactive or ghost companies distorts Nigeria’s economic reality. A streamlined and accurate corporate database, he noted, gives investors and financial institutions greater confidence when conducting due diligence, ultimately strengthening Nigeria’s investment climate and improving ease of doing business.
Beyond investor confidence, the exercise also brings relief to entrepreneurs. Thousands of business names previously locked by non-operational entities have now been released back into circulation, easing registration challenges for startups and new ventures that struggled to secure preferred company names.
The consequences of being struck off are significant. Once deregistered, a company loses its legal personality and can no longer enter contracts or initiate legal action in its corporate name. Assets owned by such companies are classified as bona vacantia and may revert to the state. In addition, the CAC collaborates with the Central Bank of Nigeria to ensure that bank accounts linked to deregistered entities are restricted to prevent unauthorized use.
For directors seeking to restore their companies, the process is far from straightforward. The Registrar General explained that reinstatement requires a formal application to the Federal High Court, full payment of outstanding filings, and settlement of all accumulated penalties before restoration can be approved.
The mass strike off represents a major shift in corporate regulation enforcement. By clearly outlining why CAC deregistered companies on such a scale, Hussaini Ishaq Magaji SAN has signaled the end of the register and abandon culture. The action reinforces the Commission’s resolve to fully enforce CAMA 2020 and ensure that Nigeria’s corporate space remains transparent, credible, and accountable. Active business owners are therefore advised to prioritize statutory compliance to avoid being caught in future regulatory sweeps.