The Competition and Consumer Protection Tribunal (CCPT) has dismissed a case against MultiChoice Nigeria concerning the company’s planned subscription price hike. This case, which drew widespread public interest, was withdrawn by the claimant, Festus Onifade, following an interim order by the tribunal.
The three-member tribunal, led by Thomas Okosu, granted the dismissal after Onifade made an oral application to withdraw his case. The case initially saw the tribunal issue an injunction on April 29, halting MultiChoice’s intended price increases for its products and services, scheduled to take effect on May 1.
The Story Background
Tekedia Mini-MBA edition 15 (Sept 9 – Dec 7, 2024) has started registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
The legal action against MultiChoice Nigeria came as a response to widespread consumer dissatisfaction and complaints about rising subscription costs. MultiChoice had earlier in the year, announced a plan to hike subscription fees, citing growing economic headwinds.
However, the implementation of the tariff increase was met with a legal challenge instituted by Onifade, who argued that the satellite TV company violated the provision of the law, which stipulated that at least, three months’ notice be given before a tariff hike is implemented.
Following the hearing, the court ordered MultiChoice to halt the implementation of the tariff, pending its ruling on the matter. However, the company defied the court order and effected the tariff.
Consequently, the court ordered MultiChoice to pay N150 million and mandated the company to provide a free monthly subscription for disobeying the tribunal’s interim orders against a planned price hike.
In May, MultiChoice announced its intention to appeal the ruling. The company reportedly filed an appeal in June.
Analysts’ Criticism and Accusations of Price Control
The tribunal’s initial decision to halt the price hike was met with significant criticism from market analysts and economic experts. Many viewed the court order as an undue interference in the free market, equating it to a form of price control.
While many Nigerians were in support of the tribunal’s decision, critics argued that such regulatory actions could undermine the principles of a free-market economy, deter investment, and stifle competition in the broadcasting and telecommunications sectors. They contended that companies should have the autonomy to set prices based on market dynamics, cost structures, and competitive pressures without undue interference from regulatory bodies.
The Argument
During the recent proceedings, MultiChoice’s legal representative, Moyosore Onibanjo, requested an adjournment of the matter until the Court of Appeal could address their application. Onibanjo argued that the law requires the tribunal to defer to the appellate court when an application is pending before it. He emphasized that MultiChoice had the right to seek a resolution from a higher judicial authority.
Onifade, however, contended that the issue of indefinite adjournment had already been settled by the tribunal and should not be revisited. He maintained that any stay of proceedings should first be sought from the tribunal that issued the initial decision. He further noted that even if MultiChoice approached a higher court, a clear ruling from that court was required before any lower court proceedings could be stayed.
The Federal Competition & Consumer Protection Commission (FCCPC), represented by I.O. Alaba, urged the tribunal to consider both parties’ arguments and exercise its discretion in ruling on the matter.
Tribunal’s Ruling
In his decision, Tribunal Chairman Thomas Okosu acknowledged MultiChoice’s right to appeal but stressed the importance of following proper legal procedures. He noted that MultiChoice’s legal team had not demonstrated any special circumstances that would have prevented them from seeking a stay of proceedings from the tribunal itself.
“Whereas we agree that MultiChoice has the right to appeal on a matter before this tribunal, the proper procedures must be followed,” Okosu stated. He clarified that the tribunal found no compelling reasons under Order 6, Rule 4 of the Court of Appeal rules that would prevent MultiChoice from filing for a stay of proceedings before the tribunal.
Consequently, the tribunal ruled that there was nothing to stay and decided to proceed with hearing the matter. In granting the claimant’s oral application to withdraw the suit, the tribunal did not award any costs. The case was adjourned until November.
The case is seen as a highlight of the ongoing legal and regulatory challenges faced by MultiChoice Nigeria, particularly concerning pricing and service delivery to its customers. Some observers said that the tribunal’s dismissal of the case may set a precedent for how future disputes between regulators, companies, and consumers are handled, especially in sectors that are vital to the economy and daily life.