…service charge increase was to ensure our survival – AMBAN
…price fixing is prohibited, against the law – FCCPC
Federal Competition and Consumer Protection Commission, FCCPC, has stated that it is investigating price fixing attempts by Point of Sales agents and will sanction them if they are found guilty.
This is following recent announcements by the PoS agents under the aegis of the Association of Mobile Money and Bank Agents in Nigeria, AMBAN, Lagos Chapter to increase their transaction charges.
According to the Public Relations Officer, Lagos Chapter, Stephen Adeoye, PoS agents now have new price lists in the state and are working to create a task force to enforce the changes.
He said, “To enforce this new price list is easy because we have a good relationship with the Lagos State Command, Police Force, and all the DPOs in the area. Very soon a task force will be set up in each zone so that they will work along with it.”
However, the FCCPC in a statement, signed by its Executive Vice Chairman/Chief Executive Officer, Babatunde Irukera, on Wednesday noted that price fixing is against the law and distort market, prevents innovation and efficiency, and impacts consumers negatively.
It said, “The Federal Competition & Consumer Protection Act (2018) recognises indeed 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.
“However, 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.
“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.”
The commission stated that the FCCPA provides stiff penalties for cartels or any similar coordinated or collusive conduct among competitors, even at association levels. It said it is ready to enforce the law to its fullest extent.
It advised AMMBAN to desist from any attempt to fix its prices.
It added, “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.”
According to the commission, it is opening an investigation to ensure statements purported to have been made by AMBAN (as regards price changes) is true, and where evidence demonstrates that these statements are true, it will take appropriate regulatory steps to address the conduct accordingly.
In a swift reaction, AMBAN said the recent increase in service charges was to ensure Point of Sale operators survive and remain in business.
It said the increment attempt in Lagos, Ogun, and Edo states was a direct response to the current economic realities in the country, noting that the cost of production has increased significantly.
In response to FCCPC in a statement signed by the National Public Relations officer, Oluwasegun Elegbede, on Wednesday, the association stressed that surging inflation has negatively impacted the “Cost to serve” adding that agency business has become unprofitable for its agents.
The statement read partly, “The recent action, in direct response to the current economic realities in the country, aims to ensure that agents can continue to stay in business.”
“It is essential to remember that our services are not subsidised by the CBN or any of the operators. The burden of the current economic reality lies squarely on the shoulders of each and every agent.
“Today, the average agent faces numerous challenges, including surging inflation, overhead costs (such as source of funding, rent, staff salaries, POS paper costs, data subscriptions, security, multiple taxation/levies), and various risks such as loss of funds through licensed operators’ channels, fraud, and robbery.”Follow us on social media