Competition in any economic environment tends to promote productivity and innovation, which then creates an enabling environment for economic development and employment. An economy where competition thrives is an attractive destination for foreign direct investments, just as its benefits result in lower prices, multiple choices and improved quality of goods and services.
A developing economy such as Nigeria may be particularly vulnerable to practices which discourage competition and respect for consumer rights. This is typically due to the absence of a strong regulatory framework, weak social and economic infrastructure and licensing regimes which facilitate the ease of doing business.
It is against this backdrop that we, at Alliance Law Firm, welcome the introduction of the Federal Competition and Consumer Protection Act (FCCPA) 2018, which represents a more robust attempt to address the anti-competitive practices and weak consumer rights culture prevalent in Nigeria. It avowed objectives include the provision of more comprehensive protection for consumers by preventing abuse and institutionalizing a more effective framework for penalizing restrictive trade and business practices.
Scope of Application of the FCCPA
The FCCPA applies to all commercial activities undertaken in the country for profit and satisfaction of public demand, whether undertaken by privately or publicly held corporate entities, corporate bodies in which either the Federal, a State or Local Government has controlling stake or agencies of the Federal Government.
Framework for Regulation
The FCCPA repeals the Consumer Protection Act, Cap 25, Laws of the Federation of Nigeria, 2004, establishes the Federal Competition and Consumer Protection Commission (“the Commission”); and the Consumer Protection Tribunal (“the Tribunal”) to facilitate efficient, fair and competitive markets in Nigeria.
The primary responsibility of the Commission is to administer and enforce the provisions of the FCCPA and any other legislation relating to competition and the protection of consumers. Its powers include compelling all manufacturers and suppliers to certify that their goods and services meet minimum quality standards and to seal up the premises of such manufacturers and suppliers where such standards have been breached.
The Tribunal shall adjudicate over all conducts prohibited under the FCCPA and its decisions shall be binding on the parties and registrable at the Federal High Court (for the purpose of enforcement only) because in the hierarchy of courts, the Tribunal has equivalent powers to the Federal High Court. Consequently, judicial reviews of the Tribunal’s decisions lie to the Court of Appeal.
Subject only to the constitution of the Federal Republic of Nigeria, the provisions of the FCCPA shall override the provisions of any other enactment in so far as it relates to competition and consumer protection matters.
The FCCPA makes copious provisions relating to the limitation of restrictive agreements which tend to promote monopolies; empowerment of the Commission to investigate abuse of dominant position, creation of monopolies in the market place for goods and services, and where corporate bodies subject to such investigations choose not to cooperate, impose appropriate fines to ensure compliance. Also, it makes specific provisions for mergers and acquisitions and seeks to regulate such consolidations in such a manner as would prevent anti-competition practices and violate the letters and spirit of the FCCPA.
By way of promoting consumer protection, the FCCPA addresses the question of price regulation as a tool for strengthening protection of consumers. It also makes elaborate provisions for consumer rights and how the Commission and the Tribunal may intervene to offer guarantees and protection. Furthermore, it stipulates the duties of manufacturers, distributors and suppliers of goods and services the breaches of which entitle consumers to seek redress as appropriate. The provisions concerning the enforcement of consumer rights detail the relevant steps that consumers may adopt in the enforcement of their rights and the protection that the legislation provides in securing those rights.
Without an iota of doubt, the enactment of the FCCPA and its introduction into Nigeria’s competition and consumer protection landscape is a long overdue development. Nigeria’s economy is replete with examples of perennial consumer rights’ abuses and anti-competition practices. It is hoped that the more robust nature of the FCCPA would provide a veritable platform for engendering a climate of respect for consumer rights and progressive competition practices.