Today, FCCPC closed Haufei Restaurant & Mall 33 Aboyade Cole, VI based on credible intel & surveillance that the biz declines service to Nigerians. Staff of the biz admitted this is the policy & our operatives experienced same. Both now closed for further regulatory action. pic.twitter.com/UI7DLCNsoL
— FCCPC Nigeria (@fccpcnigeria) March 14, 2020
The journey to better protecting Nigerian consumers
Chief Executive of the Federal Competition and Consumer Protection Commission (FCCPC) of Nigeria gave The Africa Report an interview exploring his work and plans for the future of the Commission.
In an ideal world, consumer protection commissions are the key institutions between citizens and market forces. They exist not only to protect consumers, but also to prevent market monopolies, and allow for healthy competition in various sectors.
In America, the 1906 Pure Food and Drug Act, for example, kickstarted food regulation in the country.
The Federal Competition and Consumer Protection Commission (FCCPC) is Nigeria’s version of this. And it is increasingly busy.
On 14 March, the FCCPC shut down a Chinese restaurant who had been refusing to serve Nigerian customers:
Chief Executive Mr Babatunde Irukera is determined not to allow the commission to become a complaints resolution service, instead pushing for industry actors to have stand-alone problem resolution platforms.
While he is glad that more and more consumers come to complain, for example about over-priced electricity bills, he prefers that the electricity merchants have better standards and a way that the consumers can talk directly to them and have their complaints resolved.
With particularly notable successes in the electricity and banking sectors, the Commission, like most agencies, would be able to do even more if they had access to more resources, both financial and human.
Nigeria’s Ease of Doing Business Secretariat, set up by the Vice President, has been working with the FCCPC to ensure that the Commission works with federal agencies and that proper surveillance is put in place to ensure that rules are followed by these agencies.
Chief Executive Mr Babatunde Irukera spoke to The Africa Report at the beginning of this month. Presented here is a transcript, with light editing for clarity.
The Africa Report: Is knowledge of the Commission widespread in Nigeria? Are people scared of you?
Mr Babatunde Irukera: I took on this role almost three years ago, and in the past two years, the agency has become better known to both consumers and industry players. The industry respects the FCCPC far more than before, and thus are more likely to adhere to the law and the Commission’s rules.
What has the Commission got done?
For me, the most notable success is that there is now industry-wide awareness.
The industry players are more compliant, both with competition and with consumer protection. They are more respectful of the FCCPC as a regulator – this is a reform happening in the industry itself, and it means that it won’t matter if anything happens to the regulator.
We have been doing a lot more with resolving complaints, but we have also been getting far more complaints, which shows that more people are believing in the system. Ultimately, the social path and financial contract is between consumers and companies, not between consumers and the government, and so the real satisfactions should be between them.
I would say that we have made every industry better, but the majority of complaints were to do with the electricity sector. However, increased resources were put towards resolving these complaints.
Transparency is a big problem in the electricity sector. Part of the work we have done is coming up with a new order to cap estimated billing, which was a groundbreaking game-changer for consumers in that sector.
In Nigeria, around 55% of electricity consumers were not metred, and so are paying estimated bills – capping the bills to a point where it is not beneficial to the distribution company will increase metering and reduce estimated bills.
In banking, we prohibited the arbitrary imposed POS charges, which were being put on consumers rather than on merchants.
The CBN recently came up with new banking charges guidelines stating that the N50 charge does not apply to transactions below N10,000.
Either way, this is a problem between the merchants and the banks. It is a policy issue, which does not, or rather should not, involve the consumers.
The FCCPC is doing things that are good for people on the lower rung of the food chain.
The Commission was physically established in 1999 – during the time of the Obasanjo administration. The late Mrs Dora Akunyili, DG of the National Agency for Food and Drug Administration and Control (NAFDAC) from 2001-2008 was very interested in removing counterfeit drugs from the country after her sister died from fake insulin.
At the time, did the Commission work with her? How closely? Did she succeed? How big is the problem of counterfeit drugs now?
I am of course familiar with Mrs Akunyili and her work, but I am not sure how closely the FCCPC worked with NAFDAC at the time. I do know that the Commission used to have strained relationships with many federal agencies such as NAFDAC and the Standards Organisation of Nigeria (SON). Now, these relationships are more mutually beneficial.
The FCCPC addresses substandard processes within federal agencies such as NAFDAC, SON and the Nigeria Customs Service (Customs). The Commission addresses these issues from both the consumer protection angle and from an intellectual property standpoint.
The Executive Order 01, carried out by The Presidential Enabling Business Environment Council (PEBEC), saw surveillance work being done to ensure federal agencies adhered to better standards. PEBEC is doing very good work – it has also promoted inter-agency collaboration.
How exactly do you coordinate work across the government – what I mean by that is, if for example a retailer was selling mattresses that caused skin burns on children, and you receive a complaint, what would be the process? Do you have the power to ban a retailer?
Work coordination and our resolution process depend on the problem.
In the case you have given, it would depend on if this is an individual complaint or a trend. If the former, the FCCPC will address the company and get the complaint resolved. However, if it is a trend, the FCCPC would have to go and do further investigations, as it is a standards issue. These products will then have to be removed from the market.
If a product or a service is not substandard by view of the law, but the FCCPC believes that it presents a risk, we might then need a court order to remove such a product from the market. If the merchant is not compliant, another court order might be needed to force their hand.
In general, the FCCPC has the power to do the things that we need to do. It is only companies that are reluctant to agree to what we have suggested or instructed that might end up in court with us.
If there is a monopoly distorting competition in a particular sector, this monopoly must be presented to the court to determine what remedies are needed to restrain it.
In general, companies respect FCCPC as a regulator, so we rarely need to go to court to enforce our regulatory oversight.
If President Buhari today said that you needed to double your results, what would you need to make that happen?
We would need additional resources, both human and otherwise, in order to open up offices in more parts of the country.
Do Nigerians know about you and what you are doing?
From where we are coming from, I would say a lot more people are now in the know.
In reality, however, we do not want to be a complaints resolution agency. I would rather people just be more satisfied with the products they buy and use.
We are working on companies having their own stand-alone resolution platforms, making it easy for consumers to see how to solve their complaints. Most currently do not have such a platform, which is why people complain to the government.
How do you control meat safety in Lagos and other cities? Rumours abound about chemically-treated meat.
Periodically, you do see videos circulating about products that are not healthy in this way. NAFDAC has a food safety team, and we work with them and with the Ministry of Health and Agriculture. We put out advisories, and if we come across anything, we shut it down.
We do deal with instances of inappropriate methods of keeping food fresh.