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The Nigerian FCCPA repeals the CPC published in Concurrences

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The Nigerian Federal Competition and Consumer Protection Act (FCCPA), enacted on January 30, 2019 heralded a
new dawn in the Nigerian legal sphere. The FCCPA, modelled after the South African Competition Act, established
two institutions for the purposes of enforcing its provisions. These are the Federal Competition and Consumer
Protection Commission (FCCPC) and the Competition and Consumer Protection Tribunal (CCPT). It saddled them
with the responsibility of promoting competition in the Nigerian market by eliminating monopolies, prohibiting
abuse of a dominant position and penalizing other restrictive trade and business practices. [
11
]
The FCCPA repealed the Consumer Protection Council Act, [
22
]and established the FCCPC [
33
] in the place of the
Consumer Protection Council (CPC). It also repealed Sections 118 to 127 of the Investments and Securities Act
(ISA) 2007 which hitherto empowered the Securities and Exchange Commission (SEC) to regulate and approve
mergers, and assigned this role to the FCCPC. [
44
] The FCCPA is applicable to all commercial activities within, or
having effect in Nigeria. [
55
]Its provisions are also binding on all government departments and state owned
corporations, and indeed all commercial activities aimed at making prot and targeted at satisfying demand from
the public. [
66
] It equally applies extraterritorially to any prohibited conduct by a Nigerian citizen or a person ordinarily
resident in Nigeria; a corporate body registered in Nigeria or carrying out business within Nigeria; any person
supplying or acquiring goods or services into or within Nigeria; any person in relation to the acquisition of shares or
assets outside Nigeria which results in the change of control of the business, part of the business or any asset of
the business in Nigeria. [
77
]
The FCCPC is composed of a Board made up of a Chairman, the Chief Executive of FCCPC (Vice-Chairman of the
Boards), two Executive Commissioners and four non-executive Commissioners. [
88
] These Board members are to
be appointed by the President subject to conrmation by Senate. [
99
] Likewise, the CCPT is composed of a
Chairman who shall be a lawyer with 10 years post-qualication, and experienced in competition law, consumer
protection or commercial and industrial law; six other members with 10 years professional experience in either of
The Nigerian Federal Competition and Consumer Protection
Act repeals the Consumer Protection Council Act in place of
the Consumer Protection Council
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CO MPETIT ION P O LICYCO MPETIT ION P O LICY
The Nigerian Federal Competition and Consumer Protection Act (FCCPA),
Enacts the Federal Competition and Consumer
Protection Act, 2018
, No.18 Vol 106, 30 January 2019
Old articles
Enyinnaya Uwadi | University of Reading
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competition and consumer protection law, commerce and industry, public affairs, economics, nance, or business
administration. [
1010
] The tenure of oce of the members of the CCPT is 5 years from the date of conrmation or
upon the attainment of 70 years, whichever comes rst [
1111
] The procedure for appointment of the members of
CCPT is the same with the FCCPC. The CCPT adjudicates over conduct prohibited by the FCCPA, entertain appeals
from and reviews any decision of the FCCPC, [
1212
] hear appeals on the decisions of sector-specic regulators on
competition and consumer protection matters, after the FCCPC had rst considered the appeal. [
1313
] The decision
of the Tribunal is to be registered at the Federal High Court for enforcement purposes only, [
1414
] while appeals on
the Tribunal’s decision goes to the Nigerian Court of Appeal. [
1515
]
In the context of existing legal framework, the provisions of the FCCPA override that of any other law in all matters
relating to competition and consumer protection. This implies that the FCCPC has precedence over and above any
other sector-specic regulator in matters or conducts which affect competition and consumer protection. [
1616
] To
ensure a cordial relationship and guard against power tussle between sector-specic regulators and the FCCPC,
the FCCPC is mandated to negotiate agreements with sector specic regulators having competition and consumer
protection competence to co-ordinate and harmonize the exercise of jurisdiction over competition and consumer
protection matters within the relevant industry or sector. [
1717
]
The above presents a fair representation of the institutional structures and their responsibilities under the FCCPA.
As I noted earlier, the Nigerian competition law is modelled after that of South Africa with some variations here and
there, as some of the provisions therein are replicas of that which is obtainable in the South African regime. My
thinking is that South Africa was adopted as a reference because its competition regime stands out as a model of
competition law implementation for developing countries. [
1818
] It equally appeals to them due to the fact that the
general philosophy which guides the South African Competition regime is the idea of using the law as a vehicle for
the attainment of national economic and social objectives. Eleanor Fox and Mor Bakhoum in their book Making
Markets Work for Africa (OUP, 2019) call this ‘harnessing markets to make them work for the people’. Furthermore,
its impact is felt regionally within Africa through emulation and diffusion by learning, as well as internationally via
its synergy with other developing countries on the platform of BRICS. [
1919
]
However, notwithstanding the sophistry of the regime in South Africa when compared to Nigeria, the former’s
regime has not had an easy sail in its implementation of the competition law due to some enforcement and
sometimes procedural related challenges. The general lesson here for new competition regimes in developing
countries like Nigeria is that the adoption of competition law is not an end itself, but a means to an end. To put in
other words, it is the rst step in the unending journey of competition regulation. Some of the provisions in the
FCCPA which could be a clog in the wheels of enforcement and the lessons from South Africa which could be
adopted to address these challenges will be discussed as follows:
Threat to the independence of the regulator via political control and regulatory capture. For example, the
provisions of Part XI of the FCCPA on price regulation is made subject to an order of the President, a political
actor. It is argued that the power to make such an order ought to be vested in the FCCPC and not a political actor
who may prioritise political calculations over economic decisions. Most times, governments tend to backtrack
from necessary economic decisions with long term benets, especially if unpalatable in the short term, for fear
of an unfavourable reaction in the polity which could jeopardise their political interests and popular support.
The lesson Nigeria needs to learn from South Africa is to insulate its competition regime from undue political
interference in the enforcement of its competition regime. This potential for political interference may be a
challenge to the enforcement of the provisions of Section 2 (2) (a) (b) of the FCCPA where state-owned
institutions engage in anti-competitive conduct like abuse of dominance. Global best practices in competition
regulation is that the competition authority is established as an independent, non-ministerial department,
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subject only to the law of the land, like the South African Competition Commission and the UK’s Competition
and Markets Authority, in order to insulate it from external inuence of political actors, as well as powerful
multinational rms, as the latter may threaten the independence of the FCCPC via regulatory capture as is often
the case of new competition authorities in developing countries.
There is also the overzealous approach in the wording of some sections, for example the extraterritorial
provision which applies to a Nigerian carrying on business in any part of the world in Section 2(3)(a). Inasmuch
as the extraterritorial provisions under Section 2(3) are commendable, one is left to wonder how this provision
of subsection 3a whose basis of application is the mere fact that the conduct in question was committed by a
Nigerian citizen, will be successfully implemented. [
2020
] A further concern is the criminalisation of cartels which
although is quite commendable may prove to be an overzealous approach where the expertise and resources to
successfully investigate and prosecute cartels are not in place.
The lesson here is that the FCCPA needs to be amended to expunge this impracticable overzealous provision to
the extent that it relates to a conduct by a Nigerian in another country, where the effect of the conduct has no
bearing on Nigeria. On the criminalisation of cartels, Nigeria can borrow a leaf from South Africa and introduce a
leniency program for cartels, due to the diculty in detecting, investigating and prosecuting cartels. This will
encourage rms engaging in cartels to take advantage of the friendly gesture in return for a reduced penalty.
Indeed, competition authorities from developed countries with their expertise and funding still have some
diculties in detecting cartels. This led to the adoption of the leniency programs in the ght against cartels.
South Africa recorded tremendous success in cartel prosecution following the adoption of the leniency program
in 2004, [
2121
] but experienced a downward trend upon the criminalization of cartel in 2016. This should be a
lesson for the FCCPC.
The FCCPC should adopt a one step at a time approach in implementing the FCCPA. It should not succumb to
the pressure of engaging in a wild goose chase by going after big rms without investigation and gathering
sucient evidence, in order to gain public acceptance and credibility. A single successful enforcement will
send a strong signal to the public, which is far better than hurriedly going after multiple rms at the same time
and failing to record a single success.
Another concern relates to some of the provisions of the FCCPA which appears to clash with the statutory
powers of other agencies like Standards Organisation of Nigeria; the National Agency for Food and Drug
Administration and Control and Nigerian Customs Service. These agencies also have consumer protection
powers under their respective enabling Acts may see FCCPC as a threat and consider it to be encroaching into
their statutory provinces, where they have developed considerable expertise. This poses a question on whether
these agencies will respond favourably to any approaches made by the FCCPC to them pursuant to the
provisions of Section 105(4) Act.
There is also confusion on whether or not the FCCPC is actually a supreme competition regulator under the
FCCPA. This confusion arises when comparing Section 104 which makes the FCCPA supreme to any other law
on competition and consumer protection, with Sections 47(2) and 105(4), (5) and (6) (a) (b) which recognizes
sector-specic regulators established under the relevant sectoral law. Notwithstanding the fact that Sections
47(2) and 105(6) (c) acknowledge the leadership position of the FCCPC when dealing with sector-specic
regulators, recognizing these sector-specic regulators established by other laws and mandating the FCCPC to
negotiate agreements with them [
2222
] is clearly in tension with Section 104 which starts with the supremacy
phrase, ‘Notwithstanding the provision of any other law but subject to the Constitution of the Federal Republic
of Nigeria.....” The problem here is whether these sectoral regulators will perform their duties pursuant to their
establishing Act, the FCCPA or the negotiated agreement. [
2323
]
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The above dilemma shows that an amendment of the FCCPA is imminent in order to avoid a situation of having
the FCCPC inundated by jurisdictional tussle to the detriment of competition regulation. Following the example
of the South African regime, institutional roles need to be clearly dened and streamlined in the FCCPA. It is my
view that sector-specic regulators ought not to interfere with competition matters and should focus on their
areas of core competence pursuant to the supremacy clause. This would help to avoid jurisdictional clashes
and more importantly, the under-regulation of competition in those sectors, following from the experience
Nigeria had with the SEC when it was empowered with some competition law powers under the ISA. According
to Dimgba, [
2424
] the SEC focused more on its traditional role as a securities regulator to the detriment of
competition law and regulation, as a result of its lack of expertise in the field.
Another potential challenge is the associated and potential problem with the judicial process under the FCCPA.
Competition law cases are business related, and in business, time management and ecient allocation of
resources are very important. I want to assume that the CCPT will be ecient and decide cases at a faster
pace than the regular Nigerian courts. However, the FCCPA ought to have considered the delays in the Nigerian
judiciary which can make a case linger for over 10 years, and imposed timeframes for the hearing of appeals
and delivering of judgement on competition cases at the Appeal Court, in the same manner provided in the 2018
amendment to the Nigerian Constitution for pre-electoral cases which are time bound. [
2525
] Equally, it is worth
noting that the FCCPA is silent on whether the decision of the Appeal Court on competition and consumer
protection is nal or can be further appealed to the Supreme Court. This creates another challenge of
interpretation as some cases in Nigeria terminate at the Court of Appeal while others at the Supreme Court.
Going further, notwithstanding my earlier position that sector-regulators should hand- off competition matters,
another concern with the FCCPA is the intermediate appeal procedure where the decision of sector regulators
are to be first reviewed on appeal by the FCCPC before being appealed further to the CCPT. This procedure does
not resonate well with me because of the time constraints and nancial implication it has on the overall appeal
process. Also, it is my view that the FCCPC ought not to be overburdened with so many responsibilities at this
early stage to the extent that it loses focus of its core mandate of competition regulation. [
2626
] I believe that the
CCPT will be a proper forum for appeals from the decisions of a sector regulators, for ecient management of
time and allocation of scarce resources.
Following the competition regime in South Africa, strong and competent pro- competition institutions should be
established in order to safeguard the competition process to ensure the attainment of the objectives of the
FCCPA. There is therefore the need to establish a specialised court to be called Competition and Consumer
Appeal Court (CCAC) in the place of the Court of Appeal as the appellate and nal court in competition and
consumer protection matters. The importance of having a specialized court in competition matters is that the
expertise of judges in both legal and economic concepts enables them to hear and understand expert evidence
and argument, and make decisions that are legally and economically sound, having regard to the impact upon
the system as a whole. Any further appeal on the decision of the CCPT should be to the Supreme Court only on
point of law, and subject to the leave of the Supreme Court. Timeframes on the duration of appeal should
equally be imposed in order to ensure speedy dispensation of justice.
Conc l usionCon c lusion
In conclusion, while this write-up is not advocating for a slavish adoption of the South African competition regime,
it is making a case for Nigeria to not only adopt the relevant provisions of the South African Competition Act, but
also for it to pick a few lessons in the implementation and enforcement of its regime from the experiences of an
older regime from a developing African country. This will ensure that Nigeria avoids and overcomes some of the
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likely challenges in the implementation of the new competition regime, in order to ensure the attainment of the
objectives of the FCCPA, and also the promotion of a pro-competitive national markets for the good and betterment
of its citizens, which is in line with the idea of Fox and Bakhoum in ‘Making Markets Work for Africa’.
[
11
] Explanatory Memorandum, FCCPA.
[
22
] Cap C25 LFN 2004; See Section 165, FCCPA.
[
33
] Section 3, FCCPA.
[
44
] Section 93 of the FCCPA
[
55
] Section 2.
[
66
] Ibid.
[
77
] Section 3.
[
88
] Section 4.
[
99
] Section 5.
[
1010
] Section 40.
[
1111
] .Section 41.
[
1212
] Section 47 (1)(a).
[
1313
] Section 47 (2).
[
1414
] Section 54.[[
[
1515
] Section 55 (1).
[
1616
] Section 104.
[
1717
] Section 105 (4) (5) (6).
[
1818
] Azza Raslan, ‘Mixed Policy Objectives in Merger Control: What Can Developing Countries
Learn from South Africa?’ (2016) 4 World Competition 39, Kluwer Law International, 625.
[
1919
] Jim O’Neill, ‘Dreaming with BRICs: The Path to 2050’ (2005) Global Economics Paper no.
99
http://www.macropolis.org/oriente/BRICS.pd
>f accessed 23 April, 2019; Natalya Mosunova,
‘Competition Law Enforcement in the BRICS and in Developing Countries: Legal and Economic
Aspects’ (2017) 4 BRICS L.J. 156.
[
2020
] See Enyinnaya Uwadi., ‘Prospects and Challenges of Implementing Competition Law in
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[
2020
] See Enyinnaya Uwadi., ‘Prospects and Challenges of Implementing Competition Law in
Developing Countries: A Review of the Nigerian Federal Competition and Consumer Protection Act
2019’ (LLM Dissertation, University of Reading September 2019).
[
2121
] ‘Cartels in South Africa’, Interview with Pieter Steyn (Getting the Deal Through July 2018)
<
https://gettingthedealthrough.com/i...
> accessed 25 July 2019.
[
2222
] Section 105
[
2323
] See Uwadi n 21.
[
2424
] Nnamdi Dimgba, ‘The Changing Landscape: Federal Competition And Competition Protection
Act’ (Keynote Address Delivered at the Jackson, Etti & Edu in Partnership with Norton Rose
Fulbright Conference On Competition Law, 18 June 2019) 4.
[
2525
] Constitution of the Federal Republic of Nigeria 1999 (Fourth Alteration No 21) Act 2018.
[
2626
] William E. Kovacic & Marianela Lopez-Galdos, ‘The Lifecycles of Competition Systems:
Observations on the Evolutionary Paths’(2016) 1 CPI Antitrust Chronicle 1, <
https://www.competitionpolicyinternational.com/wp-content/uploads/2016/04/Kovacic-Lopez.pdf
>
accessed 23 September 2019.
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ResearchGate has not been able to resolve any citations for this publication.
Article
Adopting mixed policy objectives (economic and non-economic) introduces a divergence to the ‘economic based model’ currently advocated as the basis for competition law convergence. One area of competition law where mixed policy objectives are prominently featured is merger control. South Africa is a leading example of a jurisdiction that embraces mixed objectives of competition law. In this article, we look at competition law enforcement in South Africa focusing on large mergers in the past fifteen years. The article goes beyond the conceptual, pros & cons discussion of the inclusion of public interest considerations in competition law to identify the analytical process followed in a merger situation and empirically examines the impact these considerations have had on the final decision, in comparison to other considerations usually taken into account, i.e. efficiencies/consumer welfare. The article also addresses administrability issues and challenges arising from this model. This should in turn, engage the academia in critical examination of this model, assist policymakers in making an informed policy choice and benefit practitioners in understanding how merger analysis functions in this mode.
Dreaming with BRICs: The Path to 2050
  • Jim O' Neill
Jim O'Neill, 'Dreaming with BRICs: The Path to 2050' (2005) Global Economics Paper no.
The Changing Landscape: Federal Competition And Competition Protection Act' (Keynote Address Delivered at the Jackson, Etti & Edu in Partnership with Norton Rose Fulbright Conference On Competition Law
  • Nnamdi Dimgba
Nnamdi Dimgba, 'The Changing Landscape: Federal Competition And Competition Protection Act' (Keynote Address Delivered at the Jackson, Etti & Edu in Partnership with Norton Rose Fulbright Conference On Competition Law, 18 June 2019) 4.