In a recent case (Emeka Nnubia vs. FCCPC & Ors) involving Nigeria’s competition regulator (the “FCCPC”) and MTN Telecommunications, the FCCPC’s request for access to certain internal documents, as part of an anti-trust investigation, was the primary reason why the Applicant, in that case filed an application to challenge the scope of the FCCPC’s regulatory oversight in Nigeria’s telecoms sector. Although unsuccessful at the court of first instance, the case presents an opportunity to take another look at the extent of the FCCPC’s investigative and information-gathering powers.
The Scope of FCCPC’s Information Gathering Powers
As per section 32 of the Federal Competition and Consumer Protection Commission Act (the “Act”), the FCCPC has broad powers to request (i) for any information or class of information and (ii) any document or class of documents, which it deems necessary, desirable and expedient for carrying out its functions under the Act.
The implication of the information gathering powers is that the FCCPC can generally request for documents and records (emails, reports, contracts, meeting notes, etc.), internal communications (including chats and Slack messages), data (market share, pricing, turnover, algorithms), including explanations or statements, from employees, managers, executives). The FCCPC can ask for information electronically or in person, and in some cases conduct dawn raids.
It is important to note that the FCCPC can also request for information which may be considered as confidential or proprietary, including information considered to be trade secrets.
Comments on Limitation on the Scope of FCCPC’s investigation powers
Although the FCCPA does not expressly constrain the scope of information requests ( and justifiably so), it is submitted that the FCCPC’s exercise of its information gathering powers remains subject to established principles of constitutional and administrative law, including the following:
- Proportionality & Relevance
It is our view that such information requests must meet the requirement of proportionality and must therefore be reasonable, necessary, relevant and proportionate to the investigation at hand. In other words, there ought to be a clear link to the investigation at hand and the FCCPC ought not simply venture on a fishing expedition. Secondly, such information requests ought to be clearly defined and specific. It is submitted that companies can legitimately challenge vague or excessively broad requests. It is further submitted that requests for information or documents, which can be independently obtained and verifiable by the FCCPC may also be subject to legal challenge, on the grounds of necessity and reasonableness.
- Judicial Review
While not directly stated in the FCCPA, any action taken by the FCCPC, including fines, issuance of binding determinations and the scope of an investigation, is subject to legal challenge under Section 6(6)(b) of the Nigerian Constitution, which allows any person to seek judicial review of administrative actions. Accordingly, where the FCCPC acts beyond its powers, affected parties can generally approach the court to set aside or vary a request.
- Fair Hearing Safeguards under the Nigerian Constitution
It is submitted that FCCPC’s power to request information or conduct investigations, ought to be read together with Section 36(1) of the Nigerian Constitution which guarantees the right to procedural and substantive fair hearing.
A number of English cases underscore the importance of ensuring procedural fair hearing during investigations. In the case of R (Gallaher Group Ltd) v. Competition and Markets Authority [2018] UKSC 25, Gallaher argued that the OFT violated the principle of equal treatment by offering different settlement terms to different parties. The decision of the Supreme Court in this matter is particularly instructive, because the court ruled that the CMA (formerly OFT) had no legal duty to maintain absolute consistency in its assurances, nor was there a breach of procedural fairness and that, mere inconsistency does not equate
to illegality in administrative decision-making. Although the Supreme Court rejected the argument of Gallaher, this case highlights the importance of complying with the established principles of administrative law during an investigation. In the case of Skyscanner Ltd v. CMA [2014] CAT 16, Skyscanner successfully contended that the CMA failed to consider relevant factors and did not consult affected parties adequately, amounting to procedural impropriety. In the US case of Axon Enterprise, Inc. v. Federal Trade Commission (2023), Axon Enterprise contested the constitutionality of the Federal Trade Commission’s (FTC) internal adjudicative process, asserting that it infringed upon their Fifth Amendment rights to due process. The U.S. Supreme Court unanimously ruled that federal district courts possess jurisdiction to hear such constitutional challenges without requiring parties to first undergo the FTC’s administrative proceedings.
- Legal Privilege
While the FCCPC can compel businesses to provide documents and information within the context of an investigation, companies are generally not required to hand over legally privileged material (e.g., confidential legal advice) as per the extant Evidence Act, applicable in Nigeria. Whilst the FCCPC may review documents to assess privilege claims, we do not expect the FCCPC to compel a disclosure of protected communications. Accordingly, the FCCPC ought to respect claims of privilege, and ought to return or exclude such documents if they are obtained inadvertently (e.g., during a dawn raid).
- Privilege Against Self-Incrimination
While the FCCPC can compel businesses to provide documents and information within the context of an investigation, individuals/companies ought not be compelled to admit to competition law breaches. This principle is consistent with section 36(11) of the Nigerian Constitution.
- Data Retention
The FCCPC ought to only retain documents collected from an information request for as long as reasonably required. It is submitted that the FCCPC may only retain documents obtained during an investigation for as long as is necessary for enforcement purposes, for appeals, internal audit and compliance with statutory retention policies. From a data protection law standpoint, any personal data or sensitive information in such documents ought to be retained only for the original lawful purpose and ought to be securely deleted/destroyed or anonymised once no longer needed.
- Confidentiality
Companies often have legitimate concerns about the confidentiality and handling of sensitive business information or trade secrets. These concerns can extend beyond the duration of an investigation, particularly in situations where a former regulator involved in an inquiry later joins a competitor. However, under the provisions of the Act, it is clear that the FCCPC has the authority to request confidential and commercially sensitive information, including trade secrets.
That said, there are both statutory and practical safeguards which businesses may consider. For example, Section 32 of the Act requires the FCCPC to take appropriate steps to protect the business secrets of companies under investigation. In addition, the FCCPC ought not to use any evidence obtained for purposes beyond the scope of the investigation, unless otherwise permitted by law.
From a practical standpoint, businesses can take proactive steps to safeguard their information, such as, (a) Clearly marking trade secrets and sensitive materials as “confidential” when submitting them to regulators; (b) Disclosing only what is strictly necessary; (c) Requesting written confirmation from the FCCPC acknowledging the confidentiality of the disclosed information; and (d) Maintaining detailed records of what was shared, who accessed it, and under what circumstances.
Additional Comments
A review of a number of the recent regulatory actions taken by the FCCPC and the nature of the response by businesses to regulatory inquiries from the FCCPC, suggests that Nigerian businesses are yet to come to terms with the provisions of the Act and the rationale for competition review by an independent regulator. If there is any doubt about the scope of the FCCPC’s powers or the importance of competition regulation to Nigerian businesses, the case of Emeka Nnubia vs FCCPC and Ors, settles this point firmly – The FCCPC has been broadly empowered by the Act as the primary authority empowered to regulate all competition issues in Nigeria – .
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