With the signing into law of the Federal Competition and Consumer Protection Act (FCCPA) 2019 by President Muhammadu Buhari, the review of mergers and acquisitions, and other business combinations has now been transferred to the Federal Competition and Consumer Protection Commission (FCCPC).
Up until now, this role was played by the Securities and Exchange Commission (SEC), the regulator of the capital market in the country, pursuant to the Investment and Securities Act (ISA).
With the creation of the Federal Competition and Consumer Protection Commission (FCCPC) which became effective from May 3rd 2019, SEC will discontinue with the aforementioned role, according to a guideline with the signatories of both SEC and FCCPC seen by BusinessDay.
The FCCPC was created by the FCCPA 2019, which was signed into law by President Buhari on January 30th, 2019. The FCCPA was formerly known as the Consumer Protection Council.
The document seen by BusinesDay with the title “SEC and FCCPA joint advisory and guidance on mergers, acquisitions and other business combinations notifications,” says that “a key role of the FCCPC is to review all mergers and other business combination or arrangement.” This, according to the document is to ensure that such combinations do not distort or impede the markets.
The new competition and consumer law mandates FCCPC to set, gazette and publish thresholds applicable to all mergers and combinations, whether small, medium or large. “This is without prejudice to the powers of SEC to determine their fairness of transactions involving public companies,” the document reads.
The FCCPC has commenced this process. However there were notifications pending before SEC at the time of the enactment of the FCCPA.
The document says that in order to ensure continuing and seamless commercial transactions and market operations, SEC and FCCPC have come to a mutual understanding with respect to these transactions within the transition period. This is to commence immediately and will remain in force until otherwise discontinued by further advisory or guidance.
The guidance notification document noted that during the transition period, starting from May 3rd 2019, all notifications or fillings will be reviewed under existing SEC regulations, guidelines and Fees but all applicable fees will be paid to FCCPC.
In the same period, SEC and FCCPC will jointly review notifications and FCCPC will convey decisions with respect to the notifications.
Notifications previously received by SEC, but yet to be decided will be subject to the interim process above and FCCPC will convey the decisions accordingly.
The recently signed FCCPA is one of the many bills the Buhari administration has enacted since assumption of office in 2015.
Other recently signed bills are: the long-awaited Minimum Wage Bill, which was passed into law in April, 2019; the Council for the Registration of Engineering in Nigeria (COREN) Amendment Bill into law; the strategic partnership agreement on export of made-in-Nigeria goods, the Discrimination Against Persons with disabilities Act, and others.
However, checks by BusinessDay revealed that the number of bills passed by the Eighth National Assembly and rejected by President Muhammadu Buhari since assumption of office has risen to 39.
Most recent on the list of bills declined assent to by Buhari is the second version of the National Transport Commission Bill.
In a letter addressed to the Senate President, Bukola Saraki, and read at Plenary, President Buhari said some sections of the National Transport Commission Bill contained safety regulations that would duplicate the functions of existing transport agencies.
This is the second time the President is rejecting the proposed legislation, having withheld his assent to the first version of the bill in December 2018.
