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Price Fixing: FCCPC warns AMMBAN, PoS operators against coordinated rates for services

*The Federal Competition and Consumer Protection Commission cautions the Lagos Chapter of Association of Mobile Money and Bank Agents in Nigeria and PoS operators against fixing prices for services, stressing  such ‘distorts the market, prevents innovation and efficiency’, besides according no benefit to consumers or other businesses in the economy

Isola Moses | ConsumerConnect

In what the market regulator has described as an “anti-competitive conduct” by banks’ agents and Point of Sale (PoS) operators, the Federal Competition and Consumer Protection Commission (FCCPC) says it has received information from multiple channels about what appears to be a collective, otherwise identified as the Lagos Chapter of the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN).

The Commission Wednesday, July 5, 2023, stated the information is an announcement conveying a purported decision of AMMBAN on behalf of certain PoS operators, which included setting uniform prices across operators for a range of transaction services.

Mr. Babatunde Irukera, Executive Vice-Chairman/CEO of FCCPC

Referencing Sections 17(a), (e), (g), (l), (p), (s), 59(1), (2)(a), 18(3)(a), (b), 107(1)(a), and 108 of the Federal Competition and Consumer Protection Act, 2018, the market regulator noted the FCCPA truly recognises and encourages the prerogative of businesses to organise in, and as trade associations for acceptable purposes, such as ensuring and enforcing applicable standards and best practices, as well as a measure of self-regulation within the profession or trade.

Mr. Babatunde Irukera, Executive Vice-Chairman/ Chief Executive Officer (EVC/CEO) of the Commission, in the statement, however, said the same FCCPA copiously and extensively limits the scope and extent of such collaboration, particularly to exclude coordination with respect to scope or supply of services and price of services.

Irukera stressed the FCCPA “expressly prohibits any price-fixing or agreement among undertakings (whether bilaterally or multilaterally) or by undertakings acting in consensus on the platform, or under the aegis of an association to fix prices, coordinate supply or any other commercially sensitive factors that can limit or substantially prevent competition; or otherwise distort the market.

“An aspiration by members of a profession or businesses in a trade association to prevent fraud; excessive or unjust prices is laudable.”

But he cautioned the industry players, that “fixing prices is not an acceptable or even proven way to accomplish these goals.

“On the contrary, fixing prices distorts the market, prevents innovation and efficiency and does not redound to the benefit of consumers or other businesses except the participants of such illegal conspiracies or conduct.”

Penalties for cartels or other collusive conduct

The Commission also said the extant FCCPA provides stiff penalties for cartels or any similar coordinated or collusive conduct among competitors, even at association levels.

“The Commission will seek to enforce the law to its fullest extent possible where there is sufficient evidence that a business has, or is participating in any such prohibited conduct or arrangement either directly, or indirectly.

“To the extent that any combination of undertakings, including AMMBAN indeed, met, agreed or decided to impose uniform or coordinated fees/tariffs for services, this announcement should serve to ensure such undertakings cease and desist from that arrangement or similar discussions/conduct,” stated FCCPC.

Investigating AMMBAN’s purported statement on coordinated/collusive rates

Meanwhile, the market regulator has disclosed it is also opening an investigation to ensure the purported statement by AMMBAN is not truly representative or erroneous.

The FCCPC said: “Where evidence demonstrates that the statement is factually accurate, the Commission will take appropriate regulatory steps to address the conduct accordingly.

“The Commission invites consumers to provide useful and credible information that can assist investigation and enforcement in this regard.”

Irukera added that contributors are invited to provide this feedback to the Commission at:

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