The Federal High Court in Lagos has nullified the ₦60 billion penalty imposed by the Advertising Regulatory Council of Nigeria (ARCON) on Facebook Nigeria, ruling that the regulator exceeded its statutory powers.
Justice Yellim Bogoro, in a judgment delivered on June 18, declared ARCON’s October 21, 2024 notice of violation and demand for compliance unconstitutional, unlawful and void.
The dispute arose after ARCON accused Facebook Nigeria of displaying advertisements on Facebook and Instagram to Nigerian audiences without prior approval from its Advertising Standards Panel, contrary to the ARCON Act and the Nigerian Code of Advertising. The regulator subsequently directed the company to stop the alleged violations and demanded payment of ₦60 billion.
Facebook Nigeria challenged the decision, arguing that ARCON lacked the legal authority to impose punitive sanctions through an administrative notice without first granting the company a fair hearing. The company also maintained that it neither owns nor operates Facebook or Instagram, stating that both platforms belong to Meta Platforms Inc., a separate foreign entity.
In his ruling, Justice Bogoro held that Facebook Nigeria is a distinct legal entity from Meta Platforms Inc. and said ARCON failed to provide evidence showing that the Nigerian company owns or controls the social media platforms.
The court further ruled that ARCON violated the company’s constitutional right to a fair hearing by imposing a financial penalty without allowing it to respond to the allegations.
Justice Bogoro also held that the alleged violations under the ARCON Act constitute criminal offences, which can only attract penalties upon conviction by a court of competent jurisdiction.
According to the court, the ₦60 billion demand was punitive in nature and could not be imposed administratively by the regulator.
The judge consequently set aside the enforcement notice and issued a perpetual injunction restraining ARCON from taking further steps to enforce the sanction against Facebook Nigeria.
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