May 23, 2023

ATCON opposes planned repeal of NITDA’s Act

ATCON opposes planned repeal of NITDA’s Act

…Says proposed law ‘ll be counter productive

By Emmanuel Elebeke

The Nigeria Telecom and ICT Sector have come a long way and making significant contribution to the growth and development of the country’s economy.

Since the liberalization of the sector in 2001, the sector has not only grown in leaps and bounds, increasing teledensity from 400 active lines to over192 million and internet penetration from 14000 to over 100 million internet users.

The sector also moved its contribution to GDP from single to now double digit of now over 18%.

The liberalization of the sector in 2001 which was not only applauded locally but international became a reference point to some other emerging economies of the world, who keep coming to borrow a leave from Nigeria’s revolutionary style.

The enabling Acts to drive the industry came into force in 2003, with enactment of the Nigerian Communications Commission, NCC Act 2003. The NCC Act mandates the agency to regulate the telecom sector, while the National Information Technology Development Agency, NITDA Act 2007 was enacted to develop and promotion Information Technology, IT in the country.

Apparently, to align with dynamics in the industry, the NITDA recently sponsored a Bill to the National Assembly to repeal its ACT in oder to widen the scope of its responsibility, including that of regulation of the telecom and ICT sector, Fintech, finance, as well as other related fields.

According to NITDA, the review of its 207 Act aimed to address contemporary digital issues, revamp Nigeria’s economy, build trust and protect the rights and interests of players in the ecosystem.

The agency further explained that the review of the Act would serve as an enabler for the growth and development of Nigeria’s digital economy.

However, this proposed repeal of NITDA Act did not go down well with some stakeholders in the industry, chief among whom is the Association of Telecommunications Companies of Nigeria, ATCON.

ATCON says such move if allowed to fly would be harmful to its members and the economy at large.

The association in a memorandum to the Senate Committee on ICT and Cyber Security obtained by Vanguard, titled: An Act to Repeal the National Information Technology Development Agency Act No. 28, 2007 and enact the National Information Technology Development Agency Act to provide for the administration, implementation and Regulation of Information Technology System and Practices as well as Digital Economy in Nigeria and for Related Matters. 2022, faulted the bill on several grounds.

It argued that the bill if passed into law posses great danger to the telecom and ICT industry in Nigeria as it will have a direct impact on the operations of its member companies and also leads to duplication of NCC’s function.

It further objected the bill on the following ground: that the bill if passed possess great danger to the telecom and ICT industry in Nigeria as it will ultimately lead to loss of confidence by both local and international investors in the telecom and ICT sector of the Nigerian economy; the proposed Bill allows for takeover of telecom and ICT infrastructure by NITDA based in their determination that they should do that without going through any legal process and that means any private business can be shut down or taken over by NITDA at will.

For ATCON, this thinking by NITDA would destroy investors’ confidence in the sector, noting that the Bill equally turns NITDA from a development agency to a regulator.

The association further argued that the proposed mandate for NITDA will directly infringe on the regulatory activities of other regulators, including the Banking, Financial Services, Insurance, Health Care, Commerce, Education, Agriculture, Telecommunications etc.

The Bill it said also calls for levy and penalties on industry operators that cuts across other sectors that will be in direct conflict to the roles that established regulators in these sectors.

Again, the bill equally calls for the establishment of an operating company, which to ATCON did not make clear the role and services this company will be involved in, which runs contrary to the policy of the government in deregulating the economy and not creating state operated companies that will be in direct competition to the private sector.

Meanwhile, for fear of addressing government’s needs, the association noted that Galaxy Backbone is capable of playing any role required to address the needs of the Federal Government under the provision of digital services to the public sector.

In its submission, the association noted that thousands of private companies operational in Nigeria exist that meet the need of the general public, hence it is counterproductive to setup another government operated company to compete with the privately funded companies.

“This will create a situation where the regulator is also competing with the companies it regulates and raises questions in the area of neutrality

“The Bill imposes huge penalties and fees on the companies doing business in the country. The private sector is already suffering from multiple taxation and huge burden in the cost of doing business in Nigeria.

“This Bill if passed will worsen the financial burden on the Nigerian citizens as the private sector will ultimately pass this cost of business to the citizens in the form of higher tariff.

“The proposed NITDA 2022 Bill infringes on the functions of the NCC as stated in the NCA 2003.

“Two Agencies of Government in the same space will create unnecessary double regulation, double taxation, confusion, discourage Capital investment and negatively impact the Ease of Doing Business Initiative of the Federal Government.

“The stable regulator environment in the Telecom Sector in Nigeria has attracted much needed FDI and domestic Investment in the Telecom Sector in Nigeria”.à

After extensive review of the proposed bill and comparing with the existing NITDA ACT 2007 as well as the Nigerian Communication ACT 2003, ATCON is opposing the passage of the Bill in the current format because it will have very devastating and negative consequence on entire industry in terms of reduced capital importation to the industry, loss of confidence by both local and international investor, unnecessary overlapping and duplication of regulation and objectives which are already captured in the Nigerian Communication ACT 2003.

Similarly, it is of the view that the NITDA new bill if passes will create avoidable crisis in the sector and this might lead to unnecessary litigations in the court.

Recall that NITDA had in September 2019 drawn the attention of stakeholders to re-enact its 2007 Act and. subsequently fly forwarded the bill to the National Assembly as an. executive bill.

According to the agency, the need to repeal the existing Act became necessary with the launch of the National Digital Economy Policy and Strategy (NDEPS), which effectively replaced the Nigerian National IT Policy, 2000.

It recalled that the target of the vision of the National IT Policy which was to make Nigeria an IT-capable country by 2005 had long elapsed, hence the need for reenactment of the Act to reflect the current realities of digital economy.

According to the Head, Corporate Affairs and External Relations, NITDA, Hadiza Umar, “since the enactment of the NITDA Act 2007, it has operated as the catalytic government agency for developing and regulating the information technology sector.

” But in the light of recent advancements in information technology and the shift in the global economy paradigm, the NDEPS was envisioned to “transform Nigeria into a leading digital economy, providing quality life and digital economies for all.”

“For NITDA, the current reality had necessitated the re-imagination for the establishment of NITDA. It is a known fact that digital technologies have created new forms of economic activities that have been beneficial to the all and economies world over.

” These digital technologies comes with their promises and perils such as cybercrimes, privacy invasion and other social problems. These necessitated the need to proactively manage their adoption through the development of a stakeholder-led robust regulatory architecture to enable Nigeria to maximise the benefits of such technologies and mitigate the negative consequences.

“Therefore, the need for a more agile and practical approach to regulations, standards-setting, and guidelines development for the country, with a focus on digital and emerging technologies, cannot be overemphasised.

“Based on the foregoing, we identified the need to update NITDA’s legal framework for regulating and developing a digital economy for Nigeria. The agency’s current establishment law is outdated. It cannot meet the needs and requirements for supporting a digital economy as well as effectively protect the rights and interests of stakeholders in the digital world,” she added.