NCC assures telcos of fair competition regulations

The Nigerian Communications Commission has assured telecommunications operators that it will not penalise companies simply for their size or commercial success, saying any regulatory intervention arising from its ongoing competition study will be targeted at preventing the abuse of market power.

The regulator’s position comes as its preliminary assessment of Nigeria’s telecommunications industry identifies operators with significant market power in six market sub-segments, raising questions about competitive conditions across an industry where access to infrastructure, barriers to expansion and consumer choice are central to market dynamics.

Speaking at the second stakeholder engagement forum on the study of competition in the telecommunications industry in Lagos on Wednesday, the Executive Vice Chairman/CEO of NCC, Dr Aminu Maida, said market dominance alone was not evidence of anti-competitive conduct.

He was represented by the  NCC’s Head of Competition and Tariff, Omotayo Mohammed.

“Smaller operators are assured that limited scale is not, in itself, a disadvantage, while larger operators should equally recognise that Significant Market Power status alone is not indicative of anti-competitive behaviour,” the EVC said.

Maida added that significant market power could be a legitimate outcome of sustained investment, innovation and commercial success, stressing that the commission’s priority was to ensure that such power did not undermine effective competition.

Maida said any intervention would be proportionate and targeted at preserving competitive market conditions, encouraging investment and innovation, improving service quality and delivering better value to consumers.

The commission’s approach will be informed by a study conducted by PricewaterhouseCoopers, which is examining competition across Nigeria’s voice, data and telecommunications infrastructure markets.

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Presenting an update on the exercise, PwC Partner, Mary Iwelumo, said the preliminary assessment had divided the industry into three broad categories, retail, wholesale and infrastructure, with 17 sub-segments identified across the markets.

The study identified operators with significant market power in six sub-segments, while it did not identify any such operators in two others. Analysis of the remaining nine sub-segments is still ongoing.

Iwelumo said the definition of nine sub-segments had been completed, with work continuing on the other eight. The findings therefore remain provisional and should not be interpreted as the commission’s final conclusions on the competitive position of individual operators or markets.

The study is intended to provide an evidence-based assessment of market concentration, evaluate the effectiveness of existing regulatory measures, examine competitive dynamics and establish whether operators possess significant market power within relevant markets.

According to Mohammed, the assessment goes beyond market shares and the number of licensed operators. It also considers barriers to entry and expansion, control over essential infrastructure, market conduct and the level of consumer choice.

These factors are particularly relevant to infrastructure-dependent services, where access to essential facilities and the cost of expanding networks can influence the ability of smaller providers to compete. The commission has not, however, presented the preliminary findings as proof that any particular operator has engaged in anti-competitive conduct.

The regulatory framework for the exercise includes the Nigerian Communications Act 2003 and the Competition Practices Regulations 2007, under which the commission assesses competition and considers appropriate measures to address identified concerns.

Iwelumo said the exercise was initially expected to take between four months and six months but had extended to about 10 months, partly because of the need to obtain enough representative data to support the analysis.