Justice Ekwo says refusal to issue or renew licences for Matrix Energy, AA Rano and AYM Shafa contravenes provisions of the Petroleum Industry Act…..
The Federal High Court in Abuja has directed the Nigerian Midstream and Downstream Petroleum Regulatory Authority to continue issuing and renewing petroleum products import licences for three major oil marketers, subject to their compliance with statutory requirements.
Justice Inyang Ekwo gave the order in a judgment involving Matrix Energy, AA Rano and AYM Shafa, who had challenged the NMDPRA’s refusal to issue or renew their import licences.
The court held that the regulatory authority’s refusal to grant the licences was inconsistent with provisions of the Petroleum Industry Act, 2021.
Justice Ekwo said the NMDPRA had acted beyond the scope of its powers by refusing to issue or renew the licences, adding that any action taken in breach of the relevant provisions of the law could not stand.
The judge consequently ruled in favour of the three oil marketers, holding that they had established their claims against the regulatory authority on the merits.
In his judgment, Justice Ekwo cited several provisions of the Petroleum Industry Act, including Sections 31, 32 and 211, alongside Section 72 of the Federal Competition and Consumer Protection Act.
According to the court, the combined provisions require the NMDPRA to promote competition within Nigeria’s midstream and downstream petroleum sectors while preventing the abuse of dominant market positions and restrictive business practices.
The judge further held that where the three companies meet the conditions prescribed by the NMDPRA, they are entitled to have their petroleum products import licences issued, extended or renewed.
The court therefore ordered the authority to continue granting, issuing, extending, renewing or reissuing licences, permits and authorisations required for midstream and downstream petroleum operations involving the importation of petroleum products.
The order, however, is subject to the companies fulfilling all applicable statutory and regulatory requirements.
Justice Ekwo’s ruling followed a legal challenge brought by the three marketers after they were denied the issuance or renewal of petroleum import licences by the NMDPRA.
Their lawyers, Raji Ahmed, SAN, and Chris Ekemezie, argued that the Petroleum Industry Act does not prohibit the importation of petroleum products into Nigeria.
They also maintained that the legislation does not prevent the NMDPRA from granting or renewing import licences for companies that meet the necessary conditions.
The marketers had asked the court to clarify the legal position and affirm their entitlement to obtain the relevant licences where they satisfy the requirements prescribed by law.
In its decision, the court agreed that the PIA does not impose a blanket prohibition on petroleum products importation or prevent the regulator from licensing eligible importers.
The ruling effectively places an obligation on the NMDPRA to process the companies’ applications in accordance with the law rather than deny the licences in a manner the court found inconsistent with the PIA.
The decision could have implications for the regulation of petroleum product imports and competition among downstream market participants, particularly as the government continues to reshape the sector under the Petroleum Industry Act.
