FCCPC sanctions British American Tobacco $110m
The Federal Competition and Consumer Protection Commission (FCCPC) on Wednesday said it has sanctioned British American Tobacco (BAT) Nigeria and its affiliate companies $110 million fine over the violations of the Commission Act and other regulations.
The commission asserted that the implicated companies had transgressed both corporate regulations and the National Tobacco Control Act, alongside other legal instruments.
The specified amount was determined through mutual engagement between the Commission and BAT parties, following the FCCPC’s Cooperation/Assistance Rules & Procedure (CARP), 2021.
The Commission said it also gathered, received and procured substantial evidence from forensic analysis of electronic communications and other information/data obtained during the search, as well as other evidence procured during, and after the search from other legitimate sources.
It added that additional investigation, including proffers, hearings, transcripts of sworn testimonies, and continuing analysis of evidence established and supported multiple violations of the FCCPA and other enactments.
The statement reads in part: “Upon full consideration of the record, BAT Parties’ additional articulation, representations and correspondence; totality of evidence procured, violations established under law, BAT Parties’ entry into, and conduct in cooperation and assistance under the Commission’s CAF; the Commission closed the investigation by the Commission and BAT Parties’ mutual execution of a Consent Order and Notice with both parties agreeing that BAT Parties shall pay a penalty of $110,000,000 under and pursuant to Sections 155 of the FCCPA, Clause 11 of the Federal Competition and Consumer Protection Commission’s Administrative Penalties Regulations, 2020 and Clause 4.2 of the Federal Competition and Consumer Protection Commission’s Investigative Cooperation/Assistance Rules and Procedures, 2021.”
BAT response and other penalties for violation
The action from the FCCPC stems from a consent order reached between BAT and the commission.
In fulfilling their obligations as per the Consent Order, the Commission has retracted pending criminal charges against BATN and, at least, one employee.
However, BAT’s response to the allegations is still pending at the time of this report.
According to FCCPC, the alleged offenses involve BAT’s actions to impede competitors and impose penalties on retailers ensuring fair opportunities for rival products.
Apart from the fine imposed on the company, other penalties were imposed for the violation.
“That BAT Parties’ shall be subject to a compliance and monitoring under the supervision of the Commission for a period of 24 months to ensure appropriate behavioral and business practices modification to be more consistent with compliance with prevailing competition laws/regulations; and tobacco control efforts.
“Mandatory public health and tobacco control advocacy in a manner compliant with tobacco control legislation and regulations, and satisfactory to the Commission as mitigation to evidence of a pattern of undermining, and circumventing national tobacco control policies and regulations.
“BAT Parties shall provide Written Assurances to the Commission pursuant to Section 153 of the FCCPA as required.
“In exchange for BAT Parties fulfilling their obligations under the Consent Order, the Commission withdrew pending criminal charges against BATN and at least one employee with respect to obstructing the Commission by attempting to prevent execution of the search warrant and initial lack of cooperation/compliance with steps in the investigation,” FCCPC said.
Implications for other foreign-owned companies in Nigeria
The penalty serves as a reminder of the regulatory scrutiny that multinational corporations face in various markets worldwide.
This is particularly true for sectors with significant public health implications, such as the tobacco industry.
Going forward, FCCPC emphasized its commitment to promoting consumer interest as well as ensuring fair market practices.
“The Commission remains committed to its mandate to promote and ensure fair markets and protect consumer interests. The outcome of this investigation demonstrates that commitment and the Commission’s desire as well as will to enforce the law and hold businesses accountable; even when it takes complex, painstaking and protracted investigations,” it said.
