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CONSUMER PROTECTION IN RELATION TO QUALITY OF SERVICE IN THE TELECOMMUNICATIONS SECTOR IN NIGERIA
Consumer protection seeks to promote a fair, accessible and sustainable market place for consumer products and services. In the telecommunications sector which is the focus of this work, consumers experience problems in different areas such as poor quality of service that has resulted in increased dropped calls, unsolicited text messages, credit depletions and poor Internet connectivity,among others. The licensing, privatisation and liberalisation of telecommunications companies in Nigeria heralded full competition in which the sector is now dominated by private corporate entities formed essentially for the purpose of making profit. This has exposed consumers to exploitation and denial of the right to good quality service. The Nigerian Communications Act,2003 which regulates the telecommunications sector established the Nigerian Communications Commission. Pursuant to its mandate, the Commission issued the Nigerian Communications Quality of Service Regulations 2013 which set basic minimum quality level for all operators among other things. The Regulations seek to ensure that service providers adhere to minimum performance standards and indices relating to the quality of service supplied to consumers. This work seeks to assess the legal and institutional framework for consumer protection in relation to quality of service in the telecommunications sector, identify the challenges of enforcement of quality of service standards and ascertain the improvements that can impact on the quality of service in the Nigerian telecommunications sector. The study found that there is a hindrance to consumer access to redress through the NCC as the Commission does not have offices in most parts of Nigeria, as such, consumers at the grassroots may not be able to seek redress. Also, service providers are seriously lagging in reaching the required performance index set by the Commission and the enforcement procedures adopted by the commission are not adequate which have led to non-achievement of effective consumer protection and good service quality. The work recommends stricter enforcement of relevant regulations by the regulator, amendment of existing statutes as well as improved consumer education.
1.1 Background to the study. 1
1.2 Statement of the Research Problem.. 6
1.4 Aim and Objectives of the Study. 6
BRIEF HISTORY OF TELECOMMUNICATIONS AND CONSUMER PROTECTION IN NIGERIA 13
2.1 Brief History of Telecommunications in Nigeria. 15
2.2 Brief History of Consumer Protection. 17
2.3 Rights and Obligations of Telecommunications Consumer 18
2.3.2 Consumer Obligations. 19
CONSUMER PROTECTION AND QUALITY OF SERVICE IN THE TELECOMMUNICATIONS SECTOR.. 21
3.1 The Legal Framework for Protection of Telecommunications Consumer 22
3.1.1 The Wireless Telegraph Act 1990. 22
3.1.2 National Telecommunications Policy. 23
3.1.3 The Nigerian Communications Act 2003. 25
3.2 Institutional Framework for Protection of Telecommunications Consumer in Nigeria. 27
3.2.1 The Nigerian Communications Commission. 27
3.3.1 Federal Ministry of Communication. 32
3.3.2 The National Assembly. 34
3.4 Consumer Protection and Quality of Service. 37
3.4.2 The Consumer Parliament 45
3.4.3 Consumer Affairs Bureau. 46
3.5 Consumer Protection and Right to Privacy. 47
3.6 Dispute Resolution Mechanism in the Act 51
3.6.1 Alternative Dispute Resolution. 52
REGULATION OF QUALITY OF SERVICE IN THE TELECOMMUNICATIONS SECTOR.. 56
4.1 Parameters for Measuring Quality of Service. 56
4.2 Measuring Quality of Service in the Telecommunications Sector 59
4.3 Auditing and Reporting of Quality of Service Data. 61
4.4 Enforcement Measures for Quality of Service in the Telecommunications Sector 62
4.5 Contravention of Quality of Service Regulations (Enforcement Actions) 63
4.5.1 Enforcement Procedures. 64
4.6 Over Regulation and Quest for Quality of Service. 65
CHALLENGES OF ENFORCING QUALITY OF SERVICE IN NIGERIA.. 68
5.1 Challenges under the Telecommunications Industry. 68
5.1.1 Regulatory Independence. 68
5.1.2 Quality of Service-Compensation. 70
5.1.3 Absence of Competition Law.. 70
5.1.5 Inadequate Transmission Infrastructure. 74
5.1.6 Inadequate Functional Landlines. 74
5.1.8 High Operational Cost 75
5.2 Challenges under the Nigerian Communications Act, 2003. 76
5.2.1 The Consumer Protection Council 76
5.2.2 Overlap of functions among the agencies. 77
5.2.3 Inherent Limitations of Civil Rights. 78
5.2.4 Practical Enforcement 79
5.3 Executive Interference. 80
SUMMARY OF FINDINGS, RECOMMENDATIONS AND CONCLUSION.. 84
6.2.1 Availability of Functional Call Centers. 85
6.2.2 Sanction against Persistent Violations. 86
6.2.3 Compensation to the Victim.. 86
6.2.4 Regulatory Independence. 87
6.2.5 Energy Reforms through Renewable Energy. 87
6.2.6 Prioritization of Information and Communications Technology (ICT) 88
6.2.7 Base Station Upgrade. 88
6.2.9 Enactment of a Consolidated Consumer Protection Act 89
6.3.10 Adequate and Effective Consumer Education. 89
CHAPTER ONE
GENERAL INTRODUCTION
1.1 Background to the study
In recent years, the capacity and speed of telecommunications[1] (telecoms) networks have grown exponentially. The capacity and speed of telecoms networks have multiplied over the years and this is not unconnected with technological growth and developments. The basic tools for these technological growth and developments are telecommunications. It cannot be over emphasised, therefore, as the saying goes that the world is fast becoming a global village of which telecoms is a key player.Telecoms is the engine of the world economy with transactions in billions of dollars being done over the telephone and the Internet. The Telecoms sector is one of the sectors that continue to grow and develop despite the economic situation in the world. The sector is developed regardless of geographical position, government and the state of economy. Telecoms is one of the most important infrastructures essential to the socio-economic wellbeing of any nation. The globalization of world economy has further amplified the importance of telecoms to the economy. The phenomenal growth of Global System for Mobile Communications (GSM) since its introduction in Nigeria in 2001 confirms the fact that telecoms has impacted much in the society.[2] Due to the pivotal roles of telecoms in the economic growth and development in Nigeria, contemporary issues regarding quality of service evidently arise, which need urgent attention to ensure the effectiveness, efficiency and contribution telecoms to the world economy. The resultant effect of this is the need to reform telecoms sector, hence, the liberalisation and privatisation of the telecoms sector.
Notwithstanding the need for reforms and regulatory frameworks for telecoms, the embryonic nature of quality of service implementation in Nigeria and some other developing economies have posed serious challenges towards the protection of telecoms consumers in Nigeria. Nigeria is the most populous country in Africa with a population of about 167 million and an area of approximately 923,768sq km[3] . The potentials in Nigeria are numerous, the same way China can be compared to Nigeria with regards to purchasing power parity and second largest economy by nominal GDP as Nigeria is a major market concerning the telecommunications sector in Africa.[4] Nigeria stands a better chance of attracting investors to invest in the economy especially in the telecommunications sector and become the China in Africa because it is one of the top ten fastest growing telecoms market in the world.[5] The Nigerian Telecommunications Sector is the fastest growing Sector in Nigeria.[6] It is large in terms of size compared to those of some African countries[7] .Currently, the News Agency of Nigeria (NAN) reports that active lines in Nigeria stood at 151,017,244 for the month of December,2015.
Prior to the bid for Digital Mobile Licences (DML) and Fixed Wireless Access (FWA), Nigeria had the lowest telephone penetration[8] in the world after Mongolia and Afghanistan.[9] The nation and its people had been starved of access to basic telephone services and eagerly awaited the commercial launch of the telephone licenses. However, the poor state of the industry began to be addressed in 1992 when the telecommunications sector was opened up for liberalisation. The global trend in the market, which is towards deregulation and liberalisation of services, has been further accelerated by the signing of the World Trade Organisation (WTO) agreement on Basic Telecommunications Services and the General Agreement on Trade in Services (GATS) which preceded it. These agreement oblige signatories to deregulate national telecommunications industries. Although Nigeria is not a signatory to this accord, she is a member of WTO, the International Telecommunications Union (ITU), an arm of the United Nations and the West African Telecommunications Regulatory Association (WATRA). It has been agreed[10] that the Agreement on Basic Telecommunications Services will affect all ITU member states and sector members because the 72 countries which made the commitment collectively, account for more than 93% of global telecommunications revenue. The areas covered under the agreement include voice data fax, radio and satellite. These agreement progressively open up the telecommunications sector to deregulation and liberalisation.
The telecommunications industry in Nigeria witnessed the deregulation of telecommunication services in 1992 through the promulgation of Nigerian Communications Act (NCA) No.75 of 1992, introducing private participation in the provision of telecommunications services in Nigeria, thus ending the state owned Nitel’s monopoly of the sector and ushering in competition. The Act was repealed by the Nigerian Communications Act, 2003, which among others strengthened the regulatory authority by ensuring its independence.
The Nigerian Communications Act, 2003 established the Nigerian Communications Commission (NCC) as the sole independent regulatory body for the country’s telecommunications industry. The Nigerian Communications Act has been very well drafted, making the NCC truly independent by enabling it to shift its focus from regulating the licensing of operators and ensuring the wide spread availability of phones to managing the competition in the market place and protecting consumers, emphasizing on service monitoring and compliance with the laws and regulations of the industry.
The liberalisation and privatisation of telecommunications sector came with competition in which 4 telecommunications service providers were licensed on the Global System for Mobile Communications (GSM) network in 2001.
The revolution in the telecommunications sector ushered in three major stakeholders: operators, consumers and regulator/government. Modern day telecommunications sector stands on a tripod made up of the operators or service providers who are directly involved in the business of providing telecommunications services with the aim of profiting. The regulators, usually government agencies, are responsible for creating enabling environment for the service providers to operate; and thirdly, consumers (users of the service).[11]
Collectively, these stakeholders make up the pillars upon which the sector stands. They co-exist and are interdependent. The operators obtain authority to carry out business from the regulator, who also serves as umpire to ensure that the operators compete favourably and fairly with each other. In addition, the regulator ensures that the consumers get value for their money. The regulators can only function where there are operators. It also, in most cases, gets funding from levies and fees paid by operators.
The most important of the stakeholders are the consumers. They are the raison d’eter for the existence of the other two. The operators are in business because the consumers are there to patronize them. Similarly, the regulators exist by an implied mandate from the consumers, through the government to not only issue licence authorization to competent operators but also ensure that their products and services are satisfactory. According to Howells and Weatherhill, in a highly liberalized market with competition at its best,
The consumer, indeed, is dominant. He or she exercises the power of commercial life or death over suppliers in the shape of his or her purchasing decision. The consumer will be supplied according to his or her preference…. There are simply products of different types from which the consumer can choose.[12]
It is worthy to note that the interest of the regulator should basically be the consumers, having derived its authority from the consumers. The consumer of telecommunications products and services in Nigeria today are varied and their tastes, needs and expectations are also varied. Generally, the consumer wants services available at all times and at every place. Furthermore, the consumer wants services to be of good quality and affordable.
When consumers experienced difficulties in accessing and connecting to telecommunications services, the NCC came up with the Quality of Service Regulations 2013 to address the challenge. The Regulations contain provisions, which mandate the operators to achieve certain demanding indices called Key Performance Indicators (KPIs) for Quality of Service.
Quality of service is the major KPI being used in determining the efficiency of an industry regarding the services rendered.[13] There are three major factors adopted in evaluating quality of service of an operator in the telecommunications industry. These are accessibility, retainability and connection quality. These three factors must be upheld towards ensuring an effective and efficient quality of service[14] .
1.2 Statement of the Research Problem
The researcher observes that the liberalisation and privatisation of telecommunications sector have shifted the focus of service providers towards profit making thereby exposing the subscribers to exploitation by way of credit depletions, unsolicited text messages, poor internet connection and a total denial of the right to good quality of service.
The Nigerian Communications Act did not make an elaborate provision on the compensation of the victims whose rights to good quality of service have been infringed and there is no provision on prioritization of consumer education and awareness creation for consumers at the grassroots.
There is the need for a more stringent provision on penalization of service providers who violet the provisions of the Act.
1.3 Research Questions
This research will address three main questions;
- Are the current regulatory regimes in the Nigerian Telecommunications industry capable of enhancing consumer protection and good quality of telecommunication services?
- To what extent have the enforcement measures towards implementing quality of service standards been adhered to?
- Are the Nigerian laws adequate for addressing the challenges facing the quality of service aspect of telecommunications sector?
1.4 Aim and Objectives of the Study
The aim of the study is to assess the level consumer protection in relation to quality of service in the telecommunications sector in Nigeria. The specific objectives are centred on three points:
- To determine if the current regulatory regimes in the Nigerian Telecommunications industry are capable of enhancing consumer protection and good quality of telecommunication services.
- To determine the extent which the enforcement measures towards implementing quality of service standards have been adhered to.
- To determine if the Nigerian laws are adequate for addressing the challenges facing the quality of service aspect of telecommunications sector.
1.5 Scope of the Study
This work is central to protection of telecommunication consumers but it is limited in scope in the sense that it only examines protection in relation to quality of service in the telecommunications sector in Nigeria.
1.6 Research Methodology
The methodology adopted in this research is doctrinal design. Reliance was placed on both primary and secondary data collection. The primary sources include relevant statutes and case Laws. The secondary sources on the other hand are textbooks, journal articles, newspaper publications and Internet sources.
1.7 Literature Review
Researchers have published several works in the field of consumer protection in the telecommunications industry without alluding to the fact that the consumer of telecommunications products and services has become the victim of many unfair and unethical tactics adopted by providers of telecommunication services. Understanding who a consumer is; usually is a convenient starting point in a research of this nature. This is important because the consumer is at the center of this research and the relevance of the resultant findings would be lost unless applied to the benefit of the consumer.
President John F. Kennedy made a famous statement to the America congress asserting that: “consumers, by definition, include us all. They are the largest economic group, affecting and affected by almost every public and private economic decision. Yet, they are the only important group whose views are often not heard”. [15]
The Consumer Protection Council Act[16] which is the foremost Nigerian legislation on consumer protection, defines the term consumer, “as an individual, who purchases, uses, maintains or disposes of products or services”. The above definition obviously embraces the two schools of thought, on this subject matter. This is because the definition goes beyond the restrictive meaning of a consumer based on contract, and extends to include persons that are not privy to the contract (end-users).
Monye, agreed with the above position when she asserted that: “it extends to contractual consumers; ultimate users as well as any person who comes in contact with a product or service”[17] .
To Ajai, he took the position that the term consumer is categorized into a broad and a narrow meaning, the broad meaning views consumers as, all persons who purchase goods (consumption goods) as different from the acquisition of capital producing goods (capital goods)[18] . Abdul Wahab also points out that the term consumer means a buyer of any product, any person to who consumes the product and any person who is entitled to the terms of the warranty of the product. Garner postulates that the word consumer is a person who buys goods or services for personal, family or household use with no intention of resale, a natural person who uses products for personal rather than business purpose.[19]
Monye is also of the view that a consumer is anyone who consumes products and services.[20] Consumer protection was upheld to have had its root in the earliest times of the Biblical era through the old testament[21] as postulated by Badaiki,[22] , it was provided thus in the bible “When thou buildest a new house, then thou shalt make a battlement for thy roof, that thou bring not blood upon thine house, if any man fall from the ice”. In this regard, it could be viewed that builders were asked to employ skill and due diligence towards the construction of the building in other to prevent injury to persons who may have access to the building. Consumer protection is a group of laws and organizations designed to ensure the rights of consumers as well as fair trade, competition and accurate information in the market place.[23]
Nwaizugbo is of the view that it should be the concern of business organizations to maintain a healthy relationship with the consumer whose satisfaction is critical to survival and growth.[24] The concept of consumer protection was further strengthened by Landan when he postulated that consumer protection has to do with the liability of not only manufacturers/producers of goods and services but also retailers, wholesalers, distributors and other suppliers of goods and services to persons who use or consume them.”
Kanyip also posits that consumer protection is about the provision of appropriate and effective mechanism to protect the pecuniary, health and secondary interest of all legal persons against misleading, fraudulent and harmful business practices, including manufacturing, trading, packing, advertising, distribution and selling of products/goods and services to the ultimate consumer[25] . Consumer protection also takes care of issues relating to the welfare of the consumer.[26]
The service quality concept has gained much attention from scholars and practitioners.
Quality of service comprises requirements on all the aspects of a connection, such as service response time, loss, signal-to-noise ratio, cross-talk, echo, interrupts, frequency response, loudness levels and so-on.[27] Cronin[28] viewed service quality as a form of attitude representing a long run real evaluation. Churchill and suprenant[29] were also of the view that service quality is measured as a belief statement or attribute of performance. Zeithuml[30] also measured service quality as the customer’s assessment of the overall service excellence.
Ukwueze views consumer complaints regarding quality of service in relation to inability to recharge due to defective recharge card or network failures, call setup failure including service interruption, cross talk, dropped calls, voice impairment, disconnection or suspension of telephone and internet or telephone line[31] .
He went further to establish that other complaints relating to poor quality of service include misleading advertisements and scam messages sent to subscribers; faulty, substandard or defective equipment supplied by service providers or their agents. Fabricio Carvalho and Thomas Magedanz were also of the view that quality of service in the telecommunications field be seen as a network to users, which are necessary in order to achieve the required functionality of an application (service). The users specify their performance requirements in form of quality of service parameters such as delay or packet loss and the network Commits it’s bandwidth making use of different Qos scheme to satisfy the request[32] .
The NCA 2003 also made provisions for consumer protection and quality of service[33] by providing that all service providers are required to meet such minimum standards of quality of service as the commission may from time to time specify and publish[34] . In line with this, the Quality of Service Regulations 2013 was established. The Regulation provides thus: Quality of Service Standard means,(a) parameters, defining the applicable quality of service standards for specific services;(b)the method of taking measurement that measure service performance against prescribed parameters;(c) any applicable targets for the prescribed parameters.
It is observed that the Quality of Service Regulation 2013 did not give any concise definition of quality of service but merely describes the standard to be attained in measuring quality of service.
Ukwueze emphasized on the fact that notwithstanding the quality of service regulation, poor quality of telecommunications services has persisted in the country. He went further to give examples of poor quality of telecommunications services in the country to include sudden loss of audio in the middle of a call, unsuccessful and high rates of call attempts, long delay and non-delivery of text messages, difficulties or inability to get assistance from operators’ customer care or support line[35]
In this regard, the author only highlighted the indices on poor quality of service without defining what quality of service should comprise of.
According to Hassalmaldin, service quality include the measure of the extent to which the service delivery meets customer’s expectations.[36]
There exists some discrepancies and gaps in the definitions of quality of service above as there is no inclusion of the key performance indicators in line with customer satisfaction.
Therefore, quality of service could be defined as the extent of accessibility, retainibility and connectivity of services towards the attainment of the satisfaction of telecommunications subscribers. This definition is broad in the sense that it encapsulations the general components of telecommunications involving voice calls, Internet services and all data compliant services.
[1] Otherwise known as telecoms.
[2] The commercial roll-out of Global System for Mobile Communications (GSM) was launched in Nigeria in
August 2001 under the President Olusegun Obasanjo’s Administration when the administration swung into
action to make the complete deregulation of the telecommunications sector a reality, most especially the
grant of licenses to GSM Service Providers.
[3] R.C Obutte, “Telecommunications and the Regulatory Regime in Nigeria”, Norwegian Research Center for Computers and Law, University of Oslo Norway,(2004).p.54
[4] E.C Ndukwe, “Telecom Investment Opportunities in Nigeria”, Modus International Law and Business Quarterly, (2000) p.19
[5] A.Amzat “Nigerian Telecoms Firm Frustrates Subscribers”, (last accessed 12 October 2015), available at www.proquest.com.
[6] A.Amzat, “Nigerian Telecoms Firm Frustrates Subscribers” (last accessed 12 October 2015), available at www.proquest.com.
[7] M. Ajakponi, “Deregulation of the Nigerian Telecommunication Industry.” Modern Practice Journal; Finance and Investment, Law,Vol 3.( 1999) p.15
[8] The most widely used measure of universal service is the percentage of household with telephone service sometimes referred to as telephone penetration.
[9] B.B. Kanyip, Consumer Protection: Law, Policy and Practice(Reckon Books Ltd 2005)p.115
[10] .M. Ajaponi, “Interconnection and the Nigerian Telecommunication industry”, Modus International Law and Business QuaterlyNo.3.( 2008)p.38
[11] NCC auctioned four GSM licenses in the sum of 240 Million Dollars each to MTN ECONET, CTL and NITEL.
[12] G.H Weatherhill, Consumer Protection Law,2nd ed. ( Ashgate UK.2005).p.78
[13] A.S Adegoke, “Quality of Service Analysis in Nigeria” American Journal of Scientific and Industrial Research,
(2011).P.119
[14] I.T Babalola, “Quality of Service Analysis of GSM Telephone in Nigeria”, Pacific Journal of Sc and Tech,(Nov. 2008.)p.23
[15] John F. Kennedy: “Special message to the congress on protecting the consumer’s interest”, available athttp://-presidency.ucs.edu.(last assessed.15 November 2015).
[16] Consumer Protection Council Act, Cap C25 Laws of the Federation of Nigeria, 2004,s.32.
[17] F.N. Monye, Law of Consumer Protection(Spectrum Books Ltd,Ibadan 2005)p.19
[18] O Ajai, Caveat Venditor Consumer Protection “Decree No.66 of 1992 Arrives in the Nigerian Market Place” (Nigerian Current Law Review 1992/93) NIALS at p.26.
[19] B.A. Garner, Black’s Law Dictionary, 8thEdn (west Group, 2004) p.335
[20] F N Monye, Protecting the Rights of Consumers in a Health Care System (Delsu Law Review vol.1, No.1 DLR 2005) p.132.
[21] Deuteronomy 22:8 KJV
[22] A.D. Badarki, Towards an International Legal Regime of Consumer Protection for Developing Countries Nigeria as a case Study, Justice, vol.6, No.4 (1993) p.43.
[23] C. Merton, “Consumer Protection” available at http;//cfapubs.org/toc/rf/consumer/protection (last accessed 23 November 2015).
[24] Nwaizugbo, Promoting Consumer Sovereignty and Consumers in Nigeria, Consumer Awareness Organisation, Enugu, Monye ed. Vol.4, (2008) at p.49.
[25] B B Kanyip, The Supreme Court and the Development of Consumer Protection in Nigeria, in the Uwais Court, (2006) N.1 A.L.S. Lagos, Guobadia’ et al p.103-122.
[26] C.I. Martin, “Advertising Practice and Consumer Protection”, Consumer Journal vol.1 (2005) p.147.
[27] Quality of Service/Encyclopedia IJU – T Recommendation August 1994., Retrieved 22 November 2015.
J J Cronin, “Measuring. Quality of Service – Re-examination and intention”, Journal of Marketing, (1992) pages 55-56.
[29] G A Churchill & C Suprenant –“An Investigation into the determinants of Customer Satisfaction”, Journal on Service Quality, (1982)
[30] V.A. Zeithaml – Integrating Consumer Focus: A Cross the Firm, 2nded. (2000) USA: McGraw Hill, Irwin.
[31] F.O. Ukwueze –“Legal Remedies for Consumers of Telecommunications Services in Nigeria” Nigerian Juridical Review (volume 10, 2011-2012) p.133
[32] F. Carvalho de Gouvella and T. Magedanz, “ Telecommunication System and Technology”, Technical University of Berlin, Franklinstr., Berlin, Germany Journal vol. 11, (2010) p.3
[33] Section 104-106
[34] Section 104 (a)
[35] F.O Ukwueze, “Consumer Protection in the Regulation of Telecommunications Services in Nigeria. Not yet “Uhuru”for Consumers”, NJR, vol. 12 (2014) p.137.
[36] T.T. Alabar “Service Quality and Customer satisfaction in Nigerian Mobile Telephony” Published by ECRTD UK (2007) p. 3
CONSUMER PROTECTION IN RELATION TO QUALITY OF SERVICE IN THE TELECOMMUNICATIONS SECTOR IN NIGERIA
