The Federal Competition and Consumer Protection Commission (FCCPC) has said that it is not against individual PoS operators increasing their prices as they deem fit to make a profit from the business.
It said what the law frowns at is the attempt by the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) to fix the prices for its members.
The Chief Executive Officer of the Commission, Mr. Babatunde Irukera, who stated this in a statement released on Monday, said the FCCPC would not allow any attempt to create a PoS business cartel that fixes.
While frowning at AMMBAN’s disregard for its earlier warning over the plan to fix prices, Irukera said the Commission was concerned about statements emanating from the executives of the association.
He, however, noted that the Commission would continue to use the advocacy approach while it would not hesitate to impose penalties when necessary.
Why FCCPC is Adopting advocacy
Noting that the Commission is not weak, Irukera said the FCCPC has adopted advocacy to enforce obedience to the law because the PoS business is dominated by young Nigerians who are creating jobs for themselves.
- “Considering that membership of AMMBAN probably consists mainly of small businesses and creates employment for young and mostly vulnerable citizens, the Commission adopted advocacy and business education as the tool to promote and enforce obedience to the law.
- “This is a prudential, not weak or helpless approach to ensuring compliance, and it underscores the Commission’s proportionality approach to its consequence management system; and interpretation of the law,” he said.
According to him, the Commission has not sought to limit the prerogative of PoS service providers to determine and set prices for services in a manner of their choosing subject to Section 127 of the Federal Competition and Consumer Protection Act 2018 (FCCPA), which prohibits manifestly unjust or exploitative prices.
- “As a matter of fact, and to the contrary, the Commission respects and encourages a pricing methodology that is the product of market forces in a free, competitive and undistorted market.
- “There is no evidence that the PoS market lacks sufficient players or competition in Lagos which is the subject of the announcement, or anywhere else for that matter.
- “The Commission welcomes the inherent powers and discretion of each PoS operator to set their prices based on their own internal mechanisms and relevant markets, providing consumers with choices and the best possible prices while ensuring profitability,” he said.
Irukera added that the FCCPA provides the Commission with statutory tools to ensure compliance and penalise violations of the law. As previously noted, some of these penalties are stiff.
He added that while the Commission continues to provide consideration to, and for small businesses, enforcing the law must remain non-negotiable.
- “Accordingly, the Commission in escalating this in accordance with the FCCPA and ancillary instruments, has entered an Order & Notice (ONC) of the Commission to AMMBAN, persons identified as executives, members, and non-member PoS operators to Cease and Desist from conduct that constitute an infringement of the law. Consequently, the ONC was issued by the Commission and served on AMMBAN,” he said.
Penalties
While insisting that the Commission would not hesitate to sanction any PoS operator where it established that the law has been broken, the FCCPC boss said the ONC conveyed the Commission’s will to enforce the law including, and up to prosecuting violators and affiliates who may otherwise be statutorily liable for the conduct of a violating Company or business.
He advised PoS operators that violation of an order of the Commission attracts additional consequences apart from the underlying illegal conduct that is the subject of the order such as up to N10,000,000 for corporate entities; and N1,000,000 and or a prison sentence of up to three months for individuals.
FCCPC – we have banks fixing prices as well…for all sorts of charges….SMS / ATM card issuance & maintenance etc – would be good to take a look at it as well…