Regulator says size and commercial success will not attract sanctions as competition study identifies significant market power in six industry segments……
The Nigerian Communications Commission (NCC) has assured telecommunications operators that they will not face regulatory sanctions simply because of their size, market dominance or commercial success, stressing that any intervention will focus on preventing the abuse of market power.
The commission said its regulatory actions would be guided by evidence of anti-competitive practices rather than the mere fact that an operator commands a significant share of the telecommunications market.
The assurance comes amid findings from the NCC’s ongoing competition assessment, which has identified operators with Significant Market Power (SMP) in six sub-segments of Nigeria’s telecommunications industry.
Speaking on Wednesday at the second stakeholder engagement forum on the competition study in Lagos, the NCC Executive Vice Chairman and Chief Executive Officer, Aminu Maida, said market dominance should not automatically be interpreted as evidence of anti-competitive behaviour.
Maida, who was represented by the commission’s Head of Competition and Tariff, Omotayo Mohammed, said the regulatory framework was designed to protect fair competition without discouraging investment and innovation.
“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,” he said.
The NCC chief explained that an operator could attain a dominant market position through sustained investment, innovation and business performance, adding that the commission’s concern was whether such influence was being used to restrict competition or disadvantage other players.
He said any regulatory measures arising from the study would be proportionate and specifically directed at maintaining a competitive market, promoting investment, encouraging innovation, improving service delivery and securing better value for consumers.
The assessment, being conducted by PricewaterhouseCoopers (PwC), covers competition across Nigeria’s telecommunications industry, including voice, data and infrastructure markets.
Providing an update on the exercise, PwC Partner, Mary Iwelumo, said the preliminary assessment had classified the industry into three major categories: retail, wholesale and infrastructure.
She disclosed that the categories were further divided into 17 market sub-segments, with the study identifying operators with significant market power in six of them.
According to her, no operators had been identified as having significant market power in two sub-segments, while investigations into the remaining nine were still underway.
Iwelumo added that the definition of nine sub-segments had been completed, with work continuing on the other eight.
She cautioned that the findings remained preliminary and should not be regarded as the commission’s final position on the competitive status of individual operators or market segments.
The study is expected to provide an evidence-based assessment of market concentration, determine how effective existing regulatory measures have been, examine competitive conditions and establish whether operators possess significant market power in relevant markets.
Mohammed explained that the assessment was not based solely on operators’ market shares or the number of companies holding licences in the industry.
Rather, it also examined the difficulties new entrants face in accessing the market, the ability of existing operators to expand, control over essential telecommunications infrastructure, market behaviour and the choices available to consumers.
These considerations are particularly important in infrastructure-dependent segments, where the cost of expanding networks and access to critical facilities could determine whether smaller operators can compete effectively with established players.
The commission, however, stressed that the preliminary identification of significant market power did not amount to a finding that any operator had engaged in anti-competitive conduct.
The exercise is being conducted under the regulatory provisions of the Nigerian Communications Act 2003 and the Competition Practices Regulations 2007, which empower the NCC to assess market conditions and introduce appropriate measures where competition concerns are established.
Iwelumo disclosed that the study, initially projected to last between four and six months, had taken approximately 10 months to progress.
She attributed the extended timeline partly to the need to obtain sufficient and representative industry data to ensure the reliability of the assessment.
The NCC is expected to use the findings to determine whether existing competition safeguards are adequate or whether additional regulatory measures are necessary to ensure a fair telecommunications market.
