How effective can the new Nigerian competition and consumer protection agency be?

The Federal Republic of Nigeria recently adopted a Competition Law as part of its overarching trade policy to make Nigeria a more competitive and attractive destination for doing business. However, following the inception of the law, the newly constituted Federal Competition and Consumer Protection Commission (FCCPC) is yet to bring a competition law related issue. Generally, given the complexities that surround the introduction of a Competition Law, it would be wrong to dismiss the caution on the part of the agency. Notwithstanding, given the generally high expectations that accompanied the introduction of the law, in Nigeria, and the rhetoric that surrounded the introduction of the framework, time will soon tell the extent to which the commission and its reform proponents accorded with the crucial advocacy and capacity building components, of the reform process, to guarantee the law’s success.

Generally, national trade policies refer to the policies of governments (and their agencies) that are directed at optimising trade within their jurisdictions. The policies can take diverse forms as introducing or removing tariffs and other monetary barriers to trade; incorporating the requisite steps concerning Rules of Origin requirements (ROOs) in bilateral, regional and international trade; deregulating and liberalising various trade and services sectors; actualising FDI openness; instigating trade facilitating measures, and introducing a Competition Law.

The competition law aims to regulate the behavioural and structural issues of firms that can lead to an over-concentration of markets, in ways that would be detrimental to the commercial interests of a society and its consumers. Aspects of the law include, controlling mergers and acquisitions; prohibiting anti-competitive practices, such as the abuses of dominant positions by firms, and cartels, and addressing concerns related to state aid. As with other types of trade policies, effectively introducing and implementing a Competition Law requires a translation of the objectives of the framework into societally backed and appreciated tenets, if the law is to be successful.

A key means by which the above transformation process can be achieved is by adopting a highly targeted and effective scheme of advocacy that incorporates measures aimed at occasioning the requisite changes in possible, counter, social and societal norms. Ideally, the scheme should identify the core private actors that can have converging/ diverging interests, on the law to be introduced (e.g. monopolies v. nascent start-ups in the case of a competition law), but are key to the success of the reform process; properly outline how the various trade and investment support institutions (ISIs) can play the roles of an arbitrator between the possibly divergent interests of their members; possess a keen understanding of the relevant issues to be addressed in the reform process, to enable the public sector achieve the right balance between private interests and public interests and objectives, and effectively advocate or propagate the public sector’s position (through public consultation fora, position papers, impact assessments etc). Also, following the introduction of a Competition Law, the requisite advocacy measures can include engaging with the relevant stakeholders to incorporate the prime aspects of the reform into the necessary educational syllabi; working with the various societal actors to ensure a thorough dissemination of the reform’s purposes and objectives, and carrying out a continuous training and acclimatisation of the key enforcement officers, that will be regularly placed in the front line of actualising the law’s objectives. In all the cases, the processes of advocacy should be directed at occasioning the highly needed, broad-based and bottom-up, social engagement and acceptance of the anticipated framework, and preventing possible reform bottlenecks.

Especially, in developing countries, the advocacy requirements of an effective Competition Law reform process are marked, and they arise from the particularities of the countries, directly contrasted to the success of a Competition Law. For example, issues like mass- misunderstandings of the purport of a competition law framework (and how the law can interface with other applicable trade policies to promote growth and marketability) exist. Also, vested interests that can severely retard the chances of the reform effort equally exist. Furthermore, the resources available for the enforcement of a Competition Law regime in developing countries are distinctively limited, making advocacy a crucial tool for the success of the framework.

Nigeria recently adopted its Competition Law framework, on the 6th of February, 2019, ushering in a new era of (significantly) harsh penalties for what had been previously accepted business practices. However, *following the entering of the law into force, it remains to be seen the extent to which the law’s reformers had effectively incorporated the above advocacy requirements into the law’s reform process. Especially, in Nigeria, the law was only passed after a protracted period of 19 years, and, like many other developing countries, Nigeria suffers from its share of developmental issues—including a significant proportion of the country’s citizens being poorly educated (not least on the nuances of a competition law framework). Also, manifest corruption is rampant in the country, with vested interests having large and consolidated stakes in prominent areas of the economy, now to be regulated by the Competition Act. Moreover, the country’s private Bar, that could ameliorate the resources shortage problem of the country, also seems to be dominated by a majority of somewhat less than ethical senior (but highly trained) defence advocates; implying that the competition authority will face uphill battles in its bid to enforce the new law.

At present, the new commission seems to be more focused on the more popular consumer protection aspects of the country’s new law, than the intricate Competition Law provisions. However, given the facts alluded to above, i.e., the expectations and rhetoric that followed the passage of the Act, the commission will eventually have to prove its worth by taking on the ‘hard’ cases. Then it will be clear the extent to which agency has performed the requisite advocacy and capacity building measures that are necessary for the success of the regime. Time will tell.

Osayomwanbor Bob Enofe

Dr Bob Enofe is an international researcher in International and Comparative Competition Law