The Nigerian Midstream & Downstream Petroleum Regulatory Authority (NMDPRA) or “The Authority” recently launched its Anti-Competition regulations (“The Regulations”) aimed at checking unethical practices centered around anti-competition in the Midstream & Downstream Petroleum industry.
This article will be looking at the provisions of these regulations, particularly its objectives and the yardsticks for determining anti-competitive activity.
What are the objectives of the regulations?
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– To provide guidance for holders of license, permit or authorisation on regulation of market principles and the prevention of anti-competitive behaviour in the Nigerian Midstream & Downstream Petroleum industry.
– To provide a basis for prescribing and applying customer protection measures in the Nigerian Midstream & Downstream Petroleum industry.
– The procedure for the determination of complaints from customers in the Nigerian Midstream & Downstream Petroleum industry.
– To prescribe sanctions & penalties for the failure to comply with these regulations.
What is the application scope of these regulations?
– These regulations shall apply to the prevention of anti-competitive behaviour and practices and customer protection in the Nigerian Midstream & Downstream Petroleum industry.
What do the regulations say on the authority to administer, monitor and ensure compliance with competition and market principles?
– The Authority shall, subject to the provisions of the Federal Competition and Consumer Protection Act(FCCPA) & any law or regulation in force, have the responsibility to :-
a). Monitor the state of the market regulated by the NMDPRA.
b). Administer, monitor and ensure compliance with the provisions of the Act & any law or regulation issued in respect of competition and market regulation.
c). Monitor market behaviour including the development and maintenance of competitive markets.
d). Prevent or stop situations of abuse of dominant power and restrictive business practices.
What are the provisions of the regulations regarding the determination of anti-competitive activity?
– The NMDPRA shall –
a) determine whether there is any anti-competitive activity being carried on and exercise its powers under these regulations to prevent continuance of the activity;
b) determine and issue, by notice, any pre-conditions and any transitional arrangements required for any services to be offered competitively by licencees.
What is the extent of the powers of the NMDPRA to prevent anti-competitive behaviour under these regulations?
– Subject to the provisions of the FCCPA in force, the authority shall have the power to prevent anti-competitive behaviour and may take any or a combination of the following actions :-
a). Monitor and determine whether any conduct by a licensee or any other person operating or intending to operate in Midstream & Downstream operations :-
(i). has the purpose or effect of substantially lessening competition in any segment of Midstream & Downstream Petroleum operations;
(ii). may likely result in anti-competitive or discriminatory conduct, including an unlawful exercise of market power that may prevent customers from obtaining the benefits of a properly functioning and competitive market;
(iii). may amount to practices which reflect an apparent or probable effect of crippling, excluding or deterring the entry of another person into Midstream and Downstream Petroleum operations;
(iv). may likely be indicative of an abuse of dominant position in respect of the provision of any service.
b). Consider how best to prevent or mitigate abuse of market power in its decisions and determinations regarding matters including license, permit or authorisation applications, grants, terms and conditions and the regulation of prices for services in competitive markets.
What are the provisions of the regulations regarding national interest?
– Notwithstanding the regulations mentioned above directly where the authority deems it to be in the national interest or necessary to preserve or promote the benefits of a functional and effective competitive market, the Authority may, on the application by a licensee or other person with the ability to influence the price of petroleum products –
a). Give written approval to the application upon such terms and conditions and impose other requirements as it may deem appropriate.
b). The NMDPRA may at any time, withdraw an approval granted under this regulation upon such terms and conditions as it may deem appropriate.
Notable Provisions Of The NMDPRA Data Depository Regulations Of Nigeria
The Nigerian Midstream & Downstream Petroleum Regulatory Authority (NMDPRA) or “The Authority” recently issued its Data Depository Regulations creating the Midstream Downstream Petroleum Data repository (or “The Repository”).
This article will be looking at the notable provisions of these regulations as well as the organizational structure of the repository.
What are the objectives of the NMDPRA regulations?
– To establish the Midstream Downstream Petroleum Data repository in the authority.
– To provide the procedure for the submission, collection and management of technical data in the repository.
– To provide sanctions and penalties for failure to comply with these regulations.
What is the application scope of these regulations?
– These regulations shall apply to the submission, collection and management of technical and commercial data in the Midstream & Downstream Oil and Gas industry in Nigeria.
What are the provisions of the regulations concerning the repository?
– There is established in the authority the Midstream & Downstream Petroleum Data Repository.
– The repository shall be located in Abuja, Nigeria or any other location as the NMDPRA chief executive may direct.
What are the functions of the Repository?
– To serve as the technical data centre for the Midstream & Downstream Petroleum industry in Nigeria.
– To provide a platform for the timely and holistic submission of data by holders of Midstream & Downstream Petroleum licenses or permits.
– To carry out storage, management, transfer, quality control and validation of all data and materials submitted to it.
– Ensure data preservation, value maximization and compliance with these regulations, standards and procedures as may be prescribed from time to time.
What is the organizational structure of the repository?
– The organizational structure of the repository shall be as set out in the first schedule to the regulations.
What constitutes the revenue of the repository under these regulations?
– Transaction & Service fees.
– Fees or levies imposed by the NMDPRA on the Midstream & Downstream Petroleum industry in the support of the repository.
– Funds and grants accruing from multilateral agencies, bilateral institutions and related sources dedicated partly or wholly for the development of data repositories.
– Any other sum freely donated or accruing to the repository for the development of the repository.
– Fees, charges and revenue accruable to the repository under these regulations shall be used for the operations, maintenance and development of the repository.
– The repository may grant discounts or waivers on transaction or service fees to subscribers based on published and clear criteria.
What are the provisions of the regulations concerning data submission?
– All records including but not limited to reports, data samples, fluid samples, plans, maps, charts, crude oil assay, accounts, materials and information which are required to be provided to the NMDPRA under the Petroleum Industry Act, regulations or any other law shall be submitted by the holder of a Midstream & Downstream license or permit to the repository in a standard and format specified by the Authority.
– The Repository shall charge fees for the storage and handling of fluid samples at designated storage facilities.
What are the provisions of these regulations on offences and penalties?
– A violation of these regulations can lead to :-
a). Exclusion from the services of the repository.
b). A civil action for the recovery of unpaid fees and accrued interest.