Ever since the legendary Scottish economist, Adam Smith, propounded the theory of the ‘invisible hand’ in his 1776 treatise – An Inquiry into the Nature and Causes of the Wealth of Nations – most nations around the world have come to accept the free market enterprise (an economic model founded upon the principles of division of labour, deregulation, and full competition) as the most efficient means of boosting productivity and creating alternative product choices for consumers, as well as a time-tested road to economic prosperity.
Over the years, legal frameworks have been developed to support an enduring and more efficient free market structure which enhances trade liberalization, prohibits monopolies and regulates anti-competitive behaviours; such as the abuse of dominant position in the market place. In a free market economy, inclusive development and economic growth cannot occur in a fair and orderly environment if there are no effective and appropriate Competition and Antitrust Laws.
The move to enact a Competition Law for Nigeria has been on for a while. The first attempt at drafting a law to regulate competition in the country was arguably made by the Bureau of Public Enterprises (“BPE”), the operative arm of the National Council on Privatization (“NCP”), between 2002 and 2003. There have been different versions of the original Bill laid before the National
Assembly since then, without being able to gain legislative approval. The latest version of the bill, introduced August 2015 and tagged Federal Competition and Consumer Protection Bill, 2015 (“the Bill”), is currently before the National Assembly for consideration.
At a time when Nigeria yearns for increased economic diversification and competitiveness to boost national productivity, reflate the economy and bring us out of recession, many believe that the passing of this Bill into law at this time is not only necessary but also urgently needed. It is therefore the aim of this article to look into why a Competition Law is due for the country and the implications of the continuing absence of a valid and competent antitrust legal regime, for an economy like Nigeria seeking to attract foreign investments and striving to become the African economic hub.
Competition in The Nigerian Economy
The latest World Economic Forum’s (“WEF”) Global Competitiveness Index (“GCI”) for 2016-2017, released on Wednesday, October 5, 2016 shows that Nigeria has dropped three places from its previous 124th to the 127th position out of 138 countries surveyed. Factors responsible for this poor showing are given as, low productivity, low commodity prices, financial market’s high risks and uncertainty, inadequate education and training, administrative and regulatory bottlenecks, and underdeveloped infrastructure which have critically affected the country’s ease of doing business.
