Before making major changes to their ownership structures, telecommunications businesses are required by the Nigerian Communications Commission (NCC) and the Corporate Affairs Commission (CAC) to acquire regulatory clearance.
In a joint statement signed on Sunday by CAC Head of Public Affairs Rasheed Mahe and NCC Director of Public Affairs Nnenna Ukoha, both organisations cautioned that any proposed transfer of ownership or control of shares in an NCC-licensed company that amounts to 10% or more of its total share capital must be accompanied by a Letter of No Objection from the NCC before CAC can make such changes.
The statement states that the rule goes into effect immediately and also applies to a sequence of share transfers that, taken together, exceed 10% of a licensee’s total share capital.
Section 90 of the Nigerian Communications Act (NCA) 2003, Regulation 28(2) of the Competition Practices Regulations, 2007, and Regulation 42 of the Licensing Regulations, 2019, according to the agencies, support the directive by giving the NCC the authority to monitor transactions that impact licensees and encourage fair competition in the industry.
In accordance with the new arrangement, the CAC will make sure that all petitions for the registration of shareholding structure modifications involving ten percent or more of a telecommunications company’s shares are supported by proof of the NCC’s previous permission and assent.
By prohibiting direct or indirect anti-competitive behaviour, the proposal, according to the NCC and CAC, aims to maintain a fair and competitive market structure in the communications industry.
Additionally, they stated that the policy will promote openness, investor trust, and regulatory certainty while strengthening regulatory scrutiny of major ownership and control transitions.
According to the statement, “the requirement is designed to preserve a fair and competitive market structure within the communications sector by preventing direct or indirect anti-competitive practices while strengthening regulatory oversight of significant changes in ownership and control.”
The agencies added that the project would contribute to the long-term stability and sustainability of Nigeria’s communications sector.
The NCC and CAC reaffirmed their dedication to cooperation and promised to keep working together to advance an open, stable, and competitive business climate. The statement went on, “Both agencies will continue to collaborate closely to ensure fair market practices, advance regulatory certainty, and support the orderly and sustainable development of Nigeria’s communications sector.”
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