In a country where there are over 149 million active phone lines,2 where over 10 million people are owners of at least one mobile phone, and where the telecommunications industry contributes more than 8 per cent to the Gross Domestic Profit (GDP) of the country,3 it has become imperative for telecom companies to provide optimum services to their subscribers.
With the deregulation of the Nigerian telecommunications sector in 2002, the industry witnessed phenomenal growth and significant business developments. These developments came by way of mergers and acquisitions with deals involving Bharti Airtel and Zain, Etisalat Nigeria (now 9mobile) and Alheri Mobile Services Ltd., and Helios Towers and Multi-Links Communications. These acquisitions were largely facilitated by the introduction of sophisticated technologies (wireless and land phone services), the introduction of innovative state-of-the-art products and services (internet, broadband and cable services), and increased private sector participation4 including Foreign Direct Investment (FDI) from diverse institutions.
The growth of this industry and the subsequent expansion of its consumer base have been characterised by an increase in customer complaints, as well as an increase in the demand for better quality of services and tariffs. With the increase in consumer complaints and the demand for the better quality services, the regulation and protection of consumers in the industry by the regulatory body has become necessary.
As with most legal conceptions, there is no generally acceptable definition of the term "consumer" or "consumer protection". Several definitions have been offered, and they all appear to be in agreement, despite the differences in presentation.
John F. Kennedy, in a special message to the United States Congress on protecting the consumer interest in 1962, gave a very apt definition of who a consumer is in the following words:
"Consumers, by definition, include us all. They are the largest economic group in the economy, affecting and affected by almost every public and private economic decision. Two-thirds of all spending in the economy is by consumers. But they are the only important group in the economy who are not effectively organized, whose views are often not heard5".
Under the Fair Trading Act, 1973 (UK)
'a consumer is any person for whom services are sought to be supplied in the course of a business carried on by the person supplying or seeking to supply them and who does not receive or seek to receive the goods or services in the course of a business carried on by him'6
A consumer is 'an individual who buys products or services for personal use and not for manufacture or resale7'. By the Nigerian Communications Commission Act8 and the Nigerian Communications Act9 a 'consumer', 'customer' and 'subscriber' mean the same thing, i.e., 'any person who subscribes to and uses a communication service'. The Consumer Protection Council (CPC) Act10 also defines a consumer as 'an individual, who purchases, uses, or maintains products or services'.
CONSUMER PROTECTION IN NIGERIA
Consumer protection can be viewed as the totality of efforts geared at preventing consumer exploitation. Through consumer protection, the government ensures that consumers derive maximum satisfaction from the services available in the market. Consumerism on the other hand is the efforts of the individual consumers to protect themselves from exploitation.11
In the early 1970s, due to industrialisation, increased education and sophistication of the consumers, there was a greater demand for quality products and the need to be informed. Many consumers reported unscrupulous activities of business organisations to the consumer protection unit of the Federal Ministry of Trade in Abuja and Lagos. There were also journalistic exposures, particularly in the print and electronic media, with dedicated consumer rights page sections. There were new laws by the legislature and from the government, and a growing number of pressure groups were established in the commercial cities of Aba, Lagos, Onitsha, Ibadan, Kaduna and Kano. The activities of these pressure groups led to the promulgation of the Consumer Protection Council Decree of 1992.12
Consumer Protection through a Review of Applicable Statutes
The existence of a regulatory framework has assisted in creating an economic environment that projects a higher level of confidence and participation by industry stakeholders in the Nigerian telecoms sector. The establishment of these laws and regulatory agencies, charged with the role of ensuring the protection of consumers/end-users/subscribers and to ensuring that consumers are not cheated or sold sub-standard products and services, amongst many other functions has led to a confidence boost in the industry.
The United Nations in 1985 issued Guidelines on Consumer Protection ("the Guidelines"). The Guidelines were revised in 2015, and is now known as the United Nations Guidelines on Consumer Protection 2016.13 In Part III, Article 5,14 the Guidelines set out to ensure:
- The protection of consumers from hazards to their health and safety;
- Promotion and protection of the economic interests of consumers;
- Consumers' access to adequate information to enable them make informed choices;
- Consumers' education, including education on the environment, social and economic impacts of consumer choice;
- The availability of effective consumer dispute resolution and redress;
- The freedom to form consumer and other relevant groups or organisations and the opportunity of such organisations to present their views in the decision-making processes affecting them.
The Guidelines cut across almost all aspects/sectors of the economy of any country where consumer interests should be protected. It represents an internationally accepted regulatory framework that serves as a basis for the elaboration and strengthening of national policies and legislations in the area of consumer protection.15
The Guidelines advocate that member states develop or maintain a strong consumer protection policy, recognising that consumers often face imbalances in economic terms and bargaining power. It further promotes the protection of consumers through the implementation of fair and reasonable standards for promoting and protecting consumers' economic interests, standards for safety and quality of goods and services, as well as promoting international co-operation.
The effective application of the Guidelines in Nigeria may be limited because the Consumer Protection Council (CPC) does not have sufficient personnel, and as such, it operates only out of regional offices within the six geo-political zones in Nigeria and lacks administrative coverage.
Several countries have general consumer protection laws, as well as privacy regulations which cover a wide range of sectors, especially in relation to their intellectual property laws and the telecoms sector; to protect consumer interests in the purchase and exchange of goods and services. Australia and Nigeria are classic examples of this interaction of different consumer protection laws especially with respect to telecoms.
Australia, for instance, ensures that the interests of its consumers are generally protected. This is evidenced by the up-to-date legislations to meet the demands of the industry such as the Telecoms Act, 1997, the Communications (Consumer Protection and Service Standards) Act, 1999, the Privacy Act, 1988, the Spam Act, 2003, and the Competition and Consumer Act, 2010. These legislations were enacted to curb the problem of consumer exploitation and ensure fair trading for businesses.
In Nigeria, although there exist several consumer-centric laws and regulations, the strategy of the Nigerian Communications Commissions ("NCC") has been termed inadequate on the grounds that the few times it responded to telecom complaints, in a bid to enforce the applicable rules, its actions have been compared to "a wielding of the sledge hammer to kill a fly".16
LEGAL REGIME OF CONSUMER PROTECTION IN NIGERIA
Several legislations exist in Nigeria for the regulation of consumer goods as well as the protection of consumers in the telecoms industry. These include:
- The Standard Organization of Nigeria (SON) Act 1971,17
- The Price Control Act 1977,18
- The Consumer Protection Council (CPC) Act 1992,19
- The Nigerian Communications Commission (NCC) Act,20
- The Nigerian Communications Act (NCA) 2003,21
- The Utilities Charges Commission (UCC) Act,22
- Post and Telecoms Proceedings Act,23
- The Quality of Service Regulation,24
- The Consumer Code Of Practice Regulations,25
- The Nigerian Communications Commission Dispute Resolution Guidelines 2004
- National Agency For Food Drugs Administration And Control (NAFDAC) Act,26
- Counterfeit and Fake Drugs and Unwholesome Processed Foods (Miscellaneous Provisions) Act,27 amongst many others.
It is important to note that the CPC Act is the principal Act that establishes the Consumer Protection Council of Nigeria (CPC), which is the agency responsible for the protection of consumers in Nigeria. The NCC regulates the Nigerian telecoms industry. Therefore, the Acts laws/regulations that will be analysed in this paper are those only bordering on the protection of consumers within the telecommunications industry in Nigeria.
It can safely be assumed that the Guidelines were taken into consideration in drafting our local consumer protection law. A cursory look will therefore be given to certain legislations and regulations governing the telecoms industry.
Consumer Protection Council Act
This Act is currently the principal legislation on consumer protection in Nigeria, from which all other laws derive their consumer protection provisions. It established the Consumer Protection Council ("CPC" or "the Council").
The Council functions28 amongst others to:
- provide speedy redress to consumers complaints through negotiations, mediation and conciliations;
- prevent the exploitation of consumers and eliminate hazardous products from the markets and cause offending companies, firms or individuals to protect and compensate injured consumer;.
- organize and undertake campaigns and other forms of activities as will lead to increased public consumer awareness, and encourage industry professionals to develop and enforce safeguards for consumer interests;
The Council operates through zonal offices and is assisted by committees set up in every state. The state committees have powers only to receive and mediate complaints between the complainants (consumers) and the defendants (service providers) and control recurring abusive consumer practices. Where parties are unable to settle their differences, the committee is required to recommend to the Council, what necessary compensation may be payable by the offending party to the injured consumer.29 In some instances, the complainant often withdraws his complaints because of the time spent at the negotiation/mediation table by the committees.
Comparing the UN Guidelines of 1985 as revised in 2016 with the CPC Act, it is clear that the CPC Act only succeeded in establishing a regulatory agency, being the Council. There is nowhere in the Act that the rights of consumers are itemized,30 neither is there any provision setting out the remedies available to an aggrieved consumer/subscriber.
With regard to Internet Communication Technology (ICT), the Council has no ICT Consumer Protection Enforcement Strategy. The Council had tried in the past to create initiatives to address emerging information technology related market malpractices. One of such initiatives was when the Council set up an initiative in December 2009, targeted at bringing succour to the consumers on the issue of poor telecom service delivery, no refund policy for defective ICT devices, abusive sales promotion and loyalty programs, as well as a wide range of abuses from ICT enabled services/products.31
With respect to telephone services, the Council entered a Memorandum of Understanding (MoU) with the NCC, handing over the protection of consumers in the telecoms industry to the NCC, thereby mortgaging its protection mandate to the NCC who has not done much to protect unsuspecting consumers. In fact, a careful examination of this MoU reveals the domineering position of the NCC over the Council. For instance, in Part C of the MoU, the NCC determines the chargeable percentage by the Council on sales promotion.
It is submitted that it is not proper nor in the interest of consumers for the Council to have entered into the MoU as it has the effect of giving conflicting roles to the NCC being the regulator of telecom licenses to these telecoms companies and being the protector of subscribers. Indeed, the Council being a general mandate holder should be the appropriate body to police the telecoms market to the extent that it impacts consumer welfare.
Upon further examination of the CPC Act, it is noted that this Act is obsolete and it came at a time when the country's economic sector was essentially run by the government. There are no provisions in the Act for possible technological advancements, despite the presence of private investors and FDIs in the industry. There are also no provisions for consumer rights as declared in the UN Guidelines even though the Act was enacted 7 years after the resolution approving the Guidelines was first passed. In fact, the language of the Act speaks more to "consumer interest" rather than "consumer rights". Although it may be argued that the Act came into force before the deregulation of the telecoms industry, the legislature has had approximately 15 years to review this Act since the deregulation of the industry.
There may be hope in the Federal Competition and Consumer Protection Bill ("the Bill") awaiting presidential assent which seeks to repeal this CPC Act. This Bill seeks to establish a consumer Protection Tribunal to adjudicate over consumer protection issues. The Bill also makes provisions for which consumer rights are to be protected,32 and other related matters thereto. It is hoped that this Bill will become law in the nearest future.
Nigerian Communications Act 200333 (NC Act)
This is the foremost statute that regulates the provision and use of telecoms services in Nigeria. It has as its primary object, to create and provide a regulatory framework for the Nigerian communications industry.34 Specifically, the Act was enacted amongst other functions, to:
- establish a regulatory framework for the Nigerian communications industry, promote the provision of efficient, reliable, affordable and easily accessible communications services;
- encourage local and foreign investment, ensure fair competition in all sectors;
- protect the rights and interests of service providers and consumers within Nigeria;
- ensure efficient management including planning, allocation, assignment, registration, monitoring and use of scarce national resources in the communications sub-sector.35
The NC Act created the National Communications Commission ("NCC" or "the Commission") and clothed it with powers to regulate the telecoms sector, promoting fair industry competition, and the promotion and protection of consumer interest against unfair practices including, but not limited to matters of tariffs and charges for and the availability and quality of telephone and other communications services supplied to consumers in Nigeria,36 amongst others.
The NC Act, by its subsidiary legislation in chapter 8 titled: "Consumer Protection and Quality of Service"37 provides a medium of protecting unsuspecting consumers within the industry. It provides that all service providers must meet the minimum standards of Quality of Service ("QoS") as published by the NCC, deal reasonably with consumers and adequately address consumer complaints.38
The Act further provides in section 105(1) that the NCC may use its powers in the resolution of consumer complaints in relation to customer service and the QoS, upon the condition that the licensee's39 dispute resolution procedures must have been exhausted first before the consumer applies the NCC's resolution process. This simply means that the aggrieved customer and the telecoms company must meet to resolve any dispute before the NCC can get involved.
The NCC, by the Act is also mandated to designate an industry body to be a consumer forum and prepare a consumer code40 which will serve as a model for reasonably meeting consumer requirements, handling customer complaints/disputes including an inexpensive arbitration process other than a court and the protection of consumer information.41 However, with all these seemingly competent and 'wide-scoped' laws aimed at protecting the unsuspecting consumer, there seems to be a state of lawlessness in the telecoms industry as the principal body charged with the responsibility of regulation of this industry suffers from poor execution of its consumer-centric policies.
In the second series to this article, we will analyse other laws regulating the telecoms industry, as well as the rights of a telecoms consumer and in the third and final series, the issues of redress of consumer complaints in Nigerian courts will also be discussed.
1. Associate: Dispute Resolution Department, SPA Ajibade & Co., Lagos.
2. See the Nigerian Communications Commission Subscriber Statistics. https://www.ncc.gov.ng/stakeholder/statistics-reports/subscriber-data accessed: 09 May 2018. As of March 2018, Nigeria has over 242 million connected phone lines.
3. According to the Premium Times, the telecoms sector contributed 1.54 Trillion Naira to Nigeria's GDP in the last quarter of 2017 https://www.premiumtimesng.com/business/business-news/242734-telecoms-sector-contributes-n1-5tn-nigerias-gdp-says-ncc.html accessed: 09 May 2018.
4. Udo Udoma & Belo-Osagie, "Regulation of Mergers, Acquisitions and Joint Ventures" International Law Office journal- (Telecommunications-Nigeria). (2011) p1 accessed: 08 May 2018 http://www.internationallawoffice.com/newsletters/detail.aspx?g=d4f3722f-1cf4-4218-ada8-85bb00d4e124.
5. John F. Kennedy: "Special Message to the Congress on Protecting the Consumer Interest" March 15th 1962. Online by Gerhard Peters and John T. Woolley, the American Presidency Project. http://www.presidency.ucsb.edu/ws/?pid=9108, accessed: 05 April 2018.
6. Fair Trading Act 1973 (UK); Section 137(2).
7.http://www.investorwords.com/1055/consumer.html accessed: 10 April 2018.
8. Nigerian Communications Commission Act; Cap N9, L.F.N. 2004.
9. Section 157 Nigerian Communications Act No. 19 of 2003.
10. Section 32 Consumer Protection Council Act; Cap C25 L.F.N. 2004.
11. Omenazu P. (2010) "Consumer Protection in Nigeria" Trifter Online. Date Posted: 30 December 2010. See also, Amzat S.A. (2012) "Impact of Consumer Protection Agencies in Nigeria: A Study of CPC, CAFON and CEON" https://www.bartleby.com/essay/Impact-of-Consumer-Protection-Agencie-in-Nigeria-PKNC8Y43RZYS Date Posted: 27 August 2012.
12. Decree No. 66 of 1992 (now Cap C25 Laws of the Federation 2004).
13. http://unctad.org/en/PublicationsLibrary/ditccplpmisc2016d1_en.pdf. The guidelines were first adopted by the UN General Assembly in resolution 39/248 of April 16, 1985, and expanded by the Economic and Social Council in resolution 1999/7 of July 26 1999. The Guidelines were further revised and adopted by the General Assembly in resolution 70/186 of December 22 2015.
14. Part III, Article 5, (C)- (H) United Nations Department of Economic and Social Affairs, United Nations Guidelines On Consumer Protection (as revised in 2015), A United Nations Document; New York, 2015.
15. Usman D.J. (2012); "A Critical Appraisal of the legal and institutional framework for consumers rights protection in the Nigerian telecommunications industry" Human Right Review: An International Human Rights Journal; Vol. 3, Feb. 2012; Faith Printers International. ISSN: 978-31030-2-4.
16. Goddie O. (2013); "NCC and anti-competitive practices in the telecoms sector"; being a newspaper publication of Daily Independent newspaper. (Monday, February 11, 2013).
17. Standard Organization of Nigeria Act Cap S9, L.F.N., 2004.
18. The Price Control Act Cap P28, L.F.N., 2004.
19. The Consumer Protection Council Act Cap C25, L.F.N., 2004. This Act is to be repealed by the Federal Competition and Consumer Protection Bill of 2016. It has been passed by the Senate and awaits presidential assent.
20. Nigerian Communications Commission Act Cap N9, L.F.N., 2004.
21. Nigerian Communications Act No. 19 of 2003.
22. Utilities Charges Commission Act Cap. U17, L.F.N., 2004.
23. Post and Telecoms Proceedings Act Cap. P24, L.F.N., 2004.
24. Nigerian Communications Act No. 19 of 2003, Quality of Service Regulations, 2012; S.I. No.3 2012.
25. Nigerian Communications Act No. 19 of 2003, Consumer Code of Practice Regulations; S.I. 32 2007. There is a draft Consumer Code of Practice Regulations of 2018 which simplifies and further streamlines the entire procedure and substantive requirements for developing telecoms consumer codes in Nigeria.
26. National Agency for Food Drugs Administration and Control Act Cap. N1, L.F.N., 2004.
27. Counterfeit & Fake Drugs & Unwholesome Processed Foods (Miscellaneous Provisions) Act; Cap. C34 L.F.N., 2004.
28. The Consumer Protection Council Act, Section 1(1) Cap C25, L.F.N., 2004.
29. Ibid, Part II, Section 5(a)(b)(c).
30. It is presumed that no consumer rights were included since it was issued under the military rule. However, since its conversion into an Act, it should have been amended to include consumer rights.
31. Williams S.; (2009) "CPC Introduces Measures against Abuses in ICT"; Daily Trust Newspaper. (Wednesday, December 16, 2009) http://allafrica.com/stories/200912160133.html accessed: 02 May 2018.
32. These rights include the right to information, right to be informed of prices of goods and services, right to choose, right to safety and quality goods, right to fair dealings, protection from unfair, unreasonable or unjust contract terms, amongst others.
33. Nigerian Communications Act No. 19 of 2003.
34. Ibid, Section 1.
35. Ibid, Section 1(a)-(i).
36. Ibid, Section 4(1)(b) & (d).
37. Nigerian Communications Act No. 19 of 2003, Part 1, Cap VIII.
38. Ibid, Section 104(a) - (c).
39. Licensee in this respect is the particular telecoms operator, e.g., MTN, GLOBACOM, 9 MOBILE, and AIRTEL.
40. Nigerian Communications Act No. 19 of 2003, Part 1, Cap VIII, Section 106(1)(2)(3).
41. Ibid, Section 106(3)(a) - (c).
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