FG proposes 5% turnover fines for erring oil companies
The Federal Government proposes fines of up to 5% of annual turnover for oil companies engaged in anti-competitive practices in Nigeria’s petroleum sector. Read More: https://punchng.com/fg-proposes-5-turnover-fines-for-erring-oil-companies/
The Nigerian government is proposing strict fines for oil companies engaging in anti-competitive practices within the midstream and downstream sectors. The proposed regulations, outlined in the draft Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations, 2026, would allow fines of up to five percent of a company's annual turnover for serious offenses.
These infractions include price-fixing, bid-rigging, market allocation, abuse of market dominance, and other behaviors that could significantly harm competition.
Fines for persistent or severe offenders could reach three to five percent of the company's annual turnover. The authority, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), may also suspend or revoke licenses and impose daily penalties for non-compliance. The maximum fine is capped at five percent of the previous year's turnover.
The regulations classify anti-competitive conduct into three categories: Category A for severe offenses, Category B for moderate offenses, and Category C for minor breaches.
Category A offenses, such as cartel agreements involving price-fixing, bid-rigging, and market allocation, or abusing dominance with foreclosure effects, may result in fines between three and five percent of annual turnover. Category B offenses, like exclusive dealing without clear foreclosure or tying with minor market harm, could incur fines between one and three percent of turnover.
Category C offenses, including failing to submit required competition reports or delays in submitting compliance reports, may attract fixed penalties ranging from N5 million to N50 million, or less than one percent of turnover.
Operators failing to comply with final cease-and-desist orders could face daily penalties between N5 million and N25 million until compliance is achieved. Those knowingly participating in serious anti-competitive practices could face personal sanctions, including referral to the Federal Competition and Consumer Protection Commission for potential personal liability.
The regulations also allow for operator's licenses or permits to be suspended or revoked for persistent or severe violations, with penalties generally due within 30 days of a Final Penalty Order.
Written by urgent.news from Punch Nigeria's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
