A FEDERAL High Court in Lagos has affirmed the powers of the Federal Competition and Consumer Protection Commission (FCCPC) to regulate Nigeria’s digital consumer lending market, including airtime and data credit services.
In a judgment that will impact on the country’s estimated N400billion airtime lending industry, Justice Ambrose Lewis-Allagoa, on Monday, July 20, dismissed a suit filed by the Wireless Application Service Providers Association of Nigeria (WASPAN), seeking to invalidate the FCCPC’s Digital, Electronic, Online and Non-Traditional Consumer Lending (DEON) Regulations.
Justice Lewis-Allagoa held that the FCCPC acted within its constitutional and statutory powers in issuing the regulations, and that its authority over competition and consumer protection extends across all sectors of the economy, including digital lending services.
The presiding Judge also held that the Federal Competition and Consumer Protection Act takes precedence in competition and consumer protection matters, while sector regulators, such as the Nigerian Communications Commission (NCC), retain responsibility for licensing, technical and prudential regulation.
Justice Lewis-Allagoa ruled that the roles of the FCCPC and NCC were complementary and not conflicting, describing their relationship as one of “coexistence, not displacement,” adding that the DEON Regulations are consumer protection measures and do not usurp the NCC’s licensing powers under the Nigerian Communications Act.
He, however, declined FCCPC’s preliminary objection challenging its jurisdiction, resolving all the substantive issues in favour of the Commission, refusing every declaration and relief sought by WASPAN.
The court vacated the interim injunctions earlier granted in April restraining the enforcement of the regulations, insisting that the basis for those orders no longer existed after the dismissal of the substantive suit.
Justice Lewis-Allagoa further ruled that a statutory regulator should not ordinarily be prevented from carrying out its lawful duties.
The suit followed the FCCPC’s introduction of the DEON Regulations as part of efforts to strengthen oversight of Nigeria’s fast-growing digital lending sector amid rising concerns over consumer protection, unfair lending practices and anti-competitive conduct.
The ruling paves the way for FCCPC to enforce the regulations across the digital lending ecosystem, including providers of airtime and data credit services.
