Competition Law in Nigeria
Competition Law in Nigeria is governed by the Federal Competition and Consumer Protection Act (FCCPA) 2019. The Act unified the laws governing competition and consumer protection in Nigeria, and gave the Federal Competition and Consumer Protection Commission (FCCPC) regulatory powers over competition in Nigeria.
Prior to the presidential assent to the FCCPA in 2019, competition law in Nigeria existed in the provisions of a couple of legislations empowering sector-specific regulators, (especially regulators established post 2002), with the power to exercise competition regulatory functions in their specific sectors. A few of these agencies include the Nigerian Communications Commission (NCC), the Nigerian Civil Aviation Authority (NCAA), the National Insurance Commission (NAICOM) and the Securities and Exchange Commission (SEC) amongst others. Unfortunately, enforcement of the competition law aspect of the regulatory functions of these agencies was largely neglected.
The FCCPA placed the review of all mergers and other business combinations or arrangements under the regulatory powers of the FCCPC, thus repealing individual sections of the Investment and Securities Act, which initially vested regulatory powers over mergers and acquisitions in the Securities and Exchange Commission.
Following the commencement of the FCCPA, the FCCPC and SEC issued a joint advisory notice to the effect that both organizations will jointly review all notifications of mergers and other business combinations or arrangements until further notice. This was to ensure continuing and seamless commercial transactions and market operations during the transition period and prior to the FCCPC assuming its full mandate as prescribed by the FCCPA.
Competition law seeks to control mergers, prohibit cartels, and regulate unilateral conducts such as abuse of market dominance by firms or business players. It is important to note that the occupation of a dominant position does not constitute a violation of competition law. What the law prohibits is the abuse of that position, especially when used to weaken competition (monopolization).[1]
Monopolization occurs where there is the possession of market power in a relevant market, and the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of innovation, a superior product, business acumen, etc.
A firm’s ability to increase its prices is usually restricted by the presence of competition and the possibility that its customers may likely switch to an alternative source of supply. Where these restrictions are weak, a firm is said to have market power. Should the market power be greatly pronounced, the firm is considered to be in a dominant position (or a monopoly).
Market power is directly evident where a firm can profitably raise prices above the competitive level. Direct evidence of market power is not always obvious; for this reason, resort is usually given to the examination of market structure to obtain evidence of market power. Here, market power can be inferred from a firm’s possession of a dominant share of a relevant market protected by entry barriers.
Section 70 of the FCCPA gives insight to the definition of a “dominant position”. It provides:
“(1) For the purpose of this Act, an undertaking is considered to be in a dominant position if it is able to act without taking account of the reaction of its customers, consumers or competitors.
(2) A dominant position in a relevant market exists where an undertaking enjoys a position of economic strength enabling it to prevent effective competition being maintained on the relevant market and having the power to behave to an appreciable extent independently of its competitors, customers and ultimately consumers.”
Section 71 of the FCCPA states the criteria for identifying the relevant market. It includes the geographical boundaries that identify groups of sellers and buyers within which competition may likely be restrained, all products that can be reasonably interchanged or substituted for the same purpose, and suppliers to which consumers may turn to if the abuse of dominance leads to a significant increase in price or to other detrimental effect upon the consumer.
It is important to state that a dominant share of a relevant market does not by itself indicate market dominance or market power, especially against the backdrop of the possibility of competition from new entrants. For this reason Section 72(3) lists criteria to be considered in determining market dominance.
The law permits the maintenance of market dominance where such is a result of innovations or improvements to a firm’s products or services. This promotes competition and is encouraged. On the other hand, restrictive agreements (exclusionary contracts), predatory pricing, conspiracy, or other conducts that serve to limit the growth of competition in a relevant market, are prohibited.
The determination of when a firm’s behavior is an abuse of market power as opposed to a competitive action can be tricky. For this reason, the FCCPA in sections 72(2) lists instances in which an act of abuse of a dominant position will be deemed to have been carried out. These include charging an excessive price to the detriment of consumers, denying competition access to essential facilities when it is economically feasible to do so, etc.
It is important to note however that certain acts that may be classified as an abuse of a dominant position are allowed by the FCCPA, where their technological efficiency and other pro-competitive gains outweigh their anti-competitive effect.
[1] See section 72 of the FCCPA.
Application of Statutes of Limitation to Employment Contracts
Recent decisions of the National Industrial Court have triggered the controversy about the application of limitation laws to employment contracts. This article will attempt to put to rest this controversy by the examination of the recent decisions on this issue, particularly the decisions of the apex court upon which the National Industrial Court has relied heavily on.
In 2019 the Supreme Court held in N.R.M.A.F.C. V. JOHNSON[1] that Section 2 of the Public Officer’s Protection Act does not apply to contracts. Surprisingly, the National Industrial Court in a couple of cases[2] has relied on this decision to hold that statutes of limitation do not apply to contracts of employment. This is surprising given the ratio decidendi of the Supreme Court, and the specific application of the Court’s judgment to the said Public Officers Protection Act. For a better understanding, the specific words of the Court in N.R.M.A.F.C. V. JOHNSON[3] are replicated below:
“In this matter, while the Appellant maintains that the action is caught by Section 2(a) of the Public Officers’ Protection Act, the Respondents argue that the act is inapplicable. There is no doubt a careful reading of the Respondents’ claim will show clearly that it is on contract of service. It is now settled law that Section 2 of the Public Officers’ Protection Act does not apply to cases of contract.[4]”
A look at the above decision would show that the ratio in the said case was not intended to apply to limitation laws generally, but to apply specifically to the Public Officers Protection Act. The reason why the Supreme Court would take this position is not hard to see. The Court had stated this when it held that
“Assuming that the appellants had that statutory cover of the Public Officers Protection Act, it has to be restated at the risk of over flogging a legal principle that certain factors would debar that operation of the Act… Abuse of office will deprive a party who would otherwise have been entitled to the protection of section 2(a) of the Public Officers (Protection) Law, misuse of power to achieve ends other than those for such power was granted, for example, for personal gain or to show undue favour for another or to wreak vengeance on an opponent.”[5]
The Court of Appeal held a similar position in NIGERIAN ARMY V. ABAYOMI [6]when it held as follows:
“The protection provided by Section 2 of the Public Officers Protection Act is however not a free for all protection. Two conditions must coexist before a person can avail himself of the protection and these are (i) the person must be a public officer; and (ii) the act done by the person in respect of which the action was commenced was an act done in pursuance or execution or intended execution of a law or public duty or authority Central Bank of Nigeria Vs Okojie (2004) 10 NWLR (Pt 882) 488, Hassan Vs Aliyu (2010) 17 NWR (Pt 1223) 547. Where either of these conditions is missing, the person concerned does not come under the provisions of Section 2 of the Public Officers Protection Act and an action against him is not caught by the three months limitation period.” [7]
One can say assuredly that the reason for the enactment of the Public Officers Protection Act differs greatly from the reason for the creation of general limitation laws. The purpose of the Public Officer’s Protection Act is to protect public officers in the lawful execution of their duties, especially as the limitation period under the Act is limited to three months. The Supreme Court stated this in the cited case of N.R.M.A.F.C. V. JOHNSON[8] , where the Court stated that
“The law is said to be designed to protect only the officer, who acts in good faith, and does not apply to acts done in abuse of office and without semblance of legal justification”[9]
However, limitation laws generally, are “designed to stop or avoid situation where a plaintiff can commence action anytime he feels like doing so, even where human memory would normally have faded and therefore failed. Put in another language, by the statute of limitation, a plaintiff has not the freedom of the air to sleep or slumber and make up at his own time to commence an action against a defendant The different statutes of limitation which are essentially founded on the principle of equity and fair play will not avail such a sleeping or slumbering plaintiff."[10].
It is the writer’s position that the basis for which the National Industrial Court has held that statutes of limitation do not apply to contracts of employment, is misconstrued. The law is trite that the application of a precedent is applicable only to a case that holds similar facts and/or similar principles of law. The Supreme Court stated this in the case of UGWUANYI Vs. NICON INSURANCE PLC[11], where the Court held as follows
"Secondly, cases remain authorities only for what they decided. Thus an earlier decision of this Court will only bind the Court and subordinate Courts in a subsequent case if the facts and the law which inform the earlier decision are the same or similar to those in the subsequent case. Where, therefore, the facts and/or the legislation which are to inform the decision in the subsequent case, differ from those which informed the Court's earlier decision, the earlier decision cannot serve as a precedent to the subsequent one. See Clement v. Iwuanyanwu (1989) 3 NWLR (Pt.107) 39 SC and Olafisoye v. FRN (2004) 4 NWLR (Pt.864) 580."[12]
The Supreme Court restated this in THOMAS V FEDERAL JUDICIAL SERVICE COMMISSION[13], where the Court held as follows:
“Learned senior counsel for the appellant/respondent cannot be faulted that a case is only an authority for what it decided. The doctrine of stare-decisis or precedent which provides for this principle operates where the issue determined by the Court in an earlier case is the same or similar to the issue the Court is subsequently approached to determine. Where therefore, an issue had not been previously raised at and determined by the Court, a decision arrived by the Court cannot rule a subsequent one on totally different fact(s) and or law(s) from those in the earlier case. See Clement v. Iwuanyanwu (1989) 3 NWLR (Pt. 107)39." [14]
The above cited decisions of the apex Court would show that the National Industrial Court erred when it came to the conclusion that based on the decision of the Court in N.R.M.A.F.C. V. JOHNSON[15] limitation laws do not apply to contracts of employment.
It is worthy to note that the apex Court has numerous decisions on the applicability of limitation laws to contracts of employment. The Court of Appeal recently in SUNDAY V. CHIEF OF AIR STAFF analyzed the decisions of the Supreme Court in coming to the conclusion that limitation laws apply to contracts of employment when it held that:
“In the case of the Nigerian Broadcasting Corporation (NBC) v. Bankole (1972) 7 NSCC 220, the respondent, a staff of the appellant, brought an action to challenge his purported dismissal outside the 12 months prescribe by section 61(1) of the Nigerian Broadcasting Act. The Supreme Court held that the action, on contract of employment, was statute-barred. Also, in the case of Ibrahim v. J.S.C. Kaduna (1998) 14 NWLR (Pt. 584) 1, the action involved a contract of employment and the provision of section 2(a) of the Act was held applicable to it. Then, the case of Bakare v. N.R.C. (2007) 17 NWLR (Pt. 1064) 606 was rooted in contract of employment. It involved the interpretation of the limitation provision in section 83(1) of the Nigerian Railway Corporation Act. At the behest of the appellant a full Supreme Court was constituted. It confirmed, with the air of finality, that contracts of employment were amenable to limitation law.”[16]
Additionally in the case of UNIVERSITY OF LAGOS V. ODEYEMI KAFARU OLUWASANMI[17], the Court held:
"...In addition, in Mwo Agbonika Sunday v. Chief of Air Staff and Anor. (2016) 1 NWLR (Pt. 1494) 615 at 624 cited in the reply brief of the appellant this Court (Makurdi Division: Coram Danjuma, Ogbuinya and Oyewole, JJ.C.A.) held per the surgically reasoned lead judgment prepared by Ogbuinya, J.C.A., and delivered on 22-05-14, that - "The recent cases of Unijos v. Ikegwuoha (2013) 9 NWLR (Pt. 1360) 478 and Ugwuanyi v. N.I.C.O.N. Insurance Plc (2013) 11 NWLR (Pt. 1366) touched on contracts of employment and the Supreme Court indicated that limitation laws are applicable to them…the Courts are infused/imbued with the competence to employ limitation provision in limitation legislation to contracts of employment as, tangibly, demonstrated in the cases of: NBA v. Bankole (supra); Ibrahim v. J.S.C. (supra); Bakare v. N.R.C. (supra); Unijos v. Ikegwuoha (supra); Ugwuanyi v. NICON Ins. Plc. (supra)” [18]
The foregoing decisions of the Nigerian Supreme Court, and of the Court of Appeal, show that limitation laws are applicable to employment contracts. These decisions should lay to rest, the needless controversy triggered by the decisions of the National Industrial Court in this regard.
[1] (2019) 2 NWLR (PT.1656) SC 247
[2] Lilian Nnenna Akumah Vs. First Bank of Nigeria Plc (Suit No. NICN/LA/402/2018, Godson Ikechukwu Nkume Vs. First Bank of Nigeria Limited (Suit No. NICN/LA/553/2018)
[3] (supra)
[4] Underlining made for emphasis
[5] Pg. 270 – 271, Paras. G – A
[6] (2019) LPELR-47084 (CA)
[7] Pg. 33 – 34, Paras. F – C
[8][8][8] (Supra)
[9] Pg. 270, Para. A
[10] AJAYI V. ADEBIYI & ORS (2012) LPELR-7811(SC), Pp. 75 paras. A
[11] (2013) LPELR-200092 (SC)
[12] Pp. 63 para. A (underlinins for emphasis)
[13] (2016) LPELR-48124(SC)
[14] Pp. 5, Para. C
[15] Supra
[16] Pg. 623 – 624, Para G – A) (Underlining ours for emphasis)
[17] (2017) LPELR-42308(CA)
[18][18] (Pp. 8-10, Para. G - B) (Underlining ours for emphasis)
