Dec 13, 2019

Competition Law in Nigeria | Ayotunde Abiodun


Over years, the business practices of Market traders, guilds and Governments have always been subject to scrutiny, and sometimes severe sanctions. The history of Competition Law reaches back to the Roman Empire. Competition Law is a legal framework put in place to promote or maintain Market Competition by regulating anti-competitive conduct by Companies.[1]  Competition Law is implemented through public and private enforcement.


The major aim of Competition Law is to ensure a deep supply market for Consumer goods and services, not just to ensure that there are many Suppliers in the market for particular goods and services, but to ensure that such Suppliers play according to a set of rules that would make it difficult for any of them, individually or as a group, to lessen or eliminate Competition in the Market. [2]  According to Leonard Ugbajah,”In a free market economy (in a market where there is competition), the consumer is King”. The underlying factor for Competition Law is Consumer Protection. Competition Law is also  known as “anti-trust law” or “anti-monopoly law” in other Jurisdictions.

Substance and Practice of Competition Law varies from Jurisdiction to Jurisdiction. The important objectives of Competition Law are to protect the interests of consumers and ensure that Entrepreneurs have an opportunity to compete in the Market economy. Competition Law has been viewed as a way to provide better public services.

Nigeria was yet to have a codified set of rules promoting Competition in the Marketplace before 2019. On the 5th of February 2019, the Federal Competition and Consumer Protection Act (FCCPA) 2019, was signed into law. This can be regarded as the first comprehensive Competition law in Nigeria.[3]  Prior to the enactment of this Act, there was no single legislation regulating competition in Nigeria. This Act supersedes all other laws regulating Competition in Nigeria such as the Investment and Securities Act 2007, the Nigerian Communications Act 2003, the Electric Reform Act 2005, except the 1999 constitution of the Federal Republic of Nigeria.[4] These Acts were Sector-specific. The FCCPA introduced a consolidated legal-regime for Competition in Nigeria. The Provisions of the FCCPA have an overriding effect on other regulations dealing with Competition and Consumer Protection matters in Nigeria. [5]

The FCCPA establishes the Federal Competition and Consumer Protection Commission and the Competition and Consumer Protection Tribunal for the promotion of competition in the Nigerian markets at all levels by eliminating monopolies, prohibiting abuse of a dominant market position and penalizing other restrictive trade and business practices.[6] The activities of the Consumer Protection Commission have been taken over by the Federal Competition and Consumer Protection Commission, established by the FCCPA.

The key objectives of the FCCPA include, promoting and maintaining a Competitive market in Nigeria, promoting economic efficiency, protecting consumer interests and welfare, prohibiting restrictive and unfair business practices and ensuring that the development of the Nigerian economy.[7] This would bring about more taxable businesses, more spending by the consumers, variety of goods and services, business striving for more quality in their manufacturing and packaging etc. These are beneficial to the Nigerian Economy. 

The key reforms of the FCCPA are laudable. Firstly, it establishes the Federal Competition and Consumer Protection (Commission) and the Competition and Consumer Protection Tribunal for the promotion of competition in the Nigerian markets at all levels by eliminating monopolies, prohibiting abuse of a dominant market position and penalizing other restrictive trade and business practices. The activities of the consumer Protection Commission have been taken over by the Federal Competition and Consumer Protection Commission, established by the FCCPA.

The Commission carries out functions like the issuance of rules and regulations to govern competition and consumer protection matters and the elimination of all anti-competitive agreements.[8] The Commission also resolves disputes, address complaints, issue directives and apply sanctions when necessary.[9]

The FCCPA also grants the Commission concurrent jurisdiction to regulate matters relating to competition and consumer protection with other sector-specific regulatory bodies. The Commission is also empowered to determine appeals or requests to review the exercise of power by sector regulators on matters affecting competition.[10] This implies that the Commission may overturn a decision made by any sector-specific regulator.

Another remarkable provision of the FCCPA is the establishment of a Competition and Consumer Protection Tribunal to conduct trials over activities, which are prohibited by the Act. Sections 39(2) and Section 47(1) of the FCCPA provides that the Tribunal can also hear appeals on decisions made by the Commission or Sector-specific regulatory authorities and impose penalties for prohibited acts. The Tribunal can also review decisions made by any sector-specific regulatory authority on issues arising from competition and consumer protection. The Tribunal can only exercise this power where such appeals or reviews have been heard by the Commission.[11] The Act also provides that the decisions of the Tribunal must be registered at the Federal High Court prior to its enforcement.[12]

The Federal Competition and Consumer Protection Act has also created a new regime for Mergers. Sections 118 to 128 of the Investment and Securities Act (ISA), which deal with mergers and acquisition, have been repealed by the Act. The Commission has been empowered to prohibit and approve mergers. That is, the Securities and Exchange Commission no longer regulates mergers and acquisitions in Nigeria. The FCCPA has a key difference as it provides for the inclusion of a Joint venture as a means by which a merger can occur in (section 92(1) (b) (iii) of the FCCPA. Intermediate mergers are not contemplated under the FCCPA as it prescribes only two categories of mergers- small and large mergers.[13] Approval of small mergers will be granted within 20 business days of filing the merger notification[14]; whilst the approval of large mergers will be granted within 60 days following the satisfaction of the merger notification requirements.[15]

The Act is binding upon a Body Corporate or an agency of Government of the Federation or agency of the Subdivision of the Federation and all commercial activities aimed at making profit and geared towards the satisfaction of demand from the public. The Act also regulates Conduct outside Nigeria by a citizen of Nigeria or a person ordinarily resident in Nigeria; a body Corporate incorporated in Nigeria or carrying out business within Nigeria; any person in relation to the supply or acquisition of goods and services by that person in relation to the acquisition of shares or other assets outside Nigeria resulting in the change of control of a business, part of a business or any assets of a business, in Nigeria.

The effective implementation of this Act will bring about the advancement of the Nigerian economy by creating an enabling business competition for healthy competition in the various sectors and industries across the Nigerian Market.



[1] (Tyler, Martin. 2006)
[2] www.wikipedia.com
[3] ACAS-LAW; Federal Competition and Consumer Protection Act 2019
[4] O. Isiadinso & E. Omoju, “The Federal Competition And Consumer Protection Act 2019: Regulatory Implications For Merger Transactions In Nigeria” available at http://www.mondaq.com/Nigeria/x/791502/Securities/The+Federal+Competition+And+Consumer+Protection+Act+2019+Regulatory+Implications+For+Merger+Transactions+In+Nigeria (accessed 2nd September 2019)
[5] Section 104 of the FCCPA
[6] Explanatory Memorandum of the FCCPA
[7] Section 1 of the FCCPA 2019
[8] Section 17(g) of the FCCPA 2019
[9] Section 17(h) of the FCCPA 2019
[10] Section 47(2) of the FCCPA 2019
[11] Section 47(2) of the FCCPA 2019
[12] Section 54(b) of the FCCPA 2019
[13] Section 92(4) of the FCCPA 2019
[14] Section 95(6) of the FCCPA 2019
[15] Section 97 of the FCCPA 2019
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