Federal High Court Upholds Power of States to Regulate Siting of Telecommunication Infrastructure
On 30th May 2018, the Federal High Court (in IHS Nigeria Limited v. Attorney General of the Federation & 4 Ors) held that States have the power to legislate on the modalities for the grant of permits to install or operate telecommunication facilities and impose one-off fees for the grant of such permits.
In this case, the plaintiff challenged the constitutionality/legality of the power of Abia State Government through its various agencies to impose business premises levy of N100,000 per mast site and an annual Environmental Support Tax as payment for licenses to erect and operate telecommunication masts. The plaintiff sought orders declaring the enabling laws as unconstitutional and void to the extent that the laws sought to regulate matters relating to posts, telegraphs, and telephones which are set out in Item 46 of the Exclusive Legislative List of the Constitution of the Federal Republic of Nigeria, 1999. The plaintiff also prayed the court to declare the sealing of its mast sites without a court order as void.
Analysis of the Decision of the Court
I. Constitutionality of Environmental Support Fee imposed by the Abia State on telecommunication mast/installation
The court held that matters relating to telecommunication masts fall within the legislative competence of the National Assembly further to which the National Assembly enacted the National Communication Act (NCA) 2003. However, section 135 of the NCA, vests States and Local Government authorities with the power to give necessary approvals to licensees under the NCA. Based on the above, the court held that the Abia State Government can incidental to its powers to make laws on physical planning and development, issue guidelines for the installation, building, and establishment of mast base stations and impose fees for grant of permits in respect thereof if the:
- fee for permits under such guidelines is a one-off fee;
- fee is to be imposed and paid before installation of the mast; and (iii) fee relates to the pollution of the air or water.
II. Imposition of Business Premises Levy on Masts Locations
The court held that the sites where telecommunication masts are located do not constitute business premises within the intendment of the enabling legislation. The court further held that the imposition of the sum of ₦100,000 per telecommunication mast site as business premises levy is oppressive and amounts to a multiplicity of taxes.
According to the court, if the Abia State Government had adverted its mind to the provisions of the Taxes and Levies (Approved List for Collection) Act, it would not have classified telecommunication sites as a business premises or imposed a recurring Environmental Support Tax on the plaintiff.
Implications of the Judgment
This decision is departure from the decision of the Court of Appeal in Lagos State Government v. Registered Trustees of ALTON (CA/L/769/2009) where the Court of Appeal struck down certain sections of the Lagos State Infrastructure Maintenance Law on grounds that the Lagos State Government was using the pretext of urban planning to regulate matters relating to telecommunications. In this case, the Court of Appeal held that issues relating telecommunications falls exclusively within the purview of the National Assembly and that no State House of Assembly can validly make laws regulating same. The departure of the FHC from this decision can be justified based on section 135 of the NCA.
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