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November 24, 2015

CONSUMER’S PROTECTION IN ADVERTISED PROMO IN THE TELECOMS INDUSTRY IN NIGERIA AND UNSOLICITED COMMERCIAL CALLS AND TEXT MESSAGES

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CONSUMER’S PROTECTION IN ADVERTISED PROMO IN THE TELECOMS INDUSTRY IN NIGERIA AND UNSOLICITED COMMERCIAL CALLS AND TEXT MESSAGES.
BY
OREGBEMHE OKHUOFU BENEDICT*
INTRODUCTION:
1.1. Promotional adverts in the Nigerian Telecoms Industry have become prevalent in Nigeria with the advent of Global Systems for Mobile Telecommunications [GSM]. It has become the latest means and tactics used by telecommunication companies to secure the attention of Nigerians into subscribing to their networks. These telecoms companies promise subscribers all sorts of items and gifts with a view to out-do each other. Nigerians participate in these promos but still doubt if winners actually get what they win.
1.2. Most of the time, a subscriber receives an unsolicited commercial call at odd hours trying to sell a product or urging a subscriber to participate in a promotion or a text message offering thousands of products and services or to participate in a quiz to win prizes or gifts. All of these unsolicited commercial and nuisance calls and messages can be very frustrating and annoying.
1.3. A 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 product for personal rather than business purposes.1. Every nation of the world protects its consumers against the exploitative nature of manufacturers or capitalists whose main entrepreneurial tendencies are driven by profits or gains. This protection is normally through the legal instruments within the State and bilateral agreements between States protecting inter-state consumption of goods and services.
1.4. Consumer protection consists of laws and organizations designed to ensure the rights of consumers as well as fair trade competition and the free flow of truthful information in the marketplace. The laws are designed to prevent businesses from fraud or unfair practices
*LL.M. (UNILAG), BL, (Nig. Law Sch.) LL.B (Hons) (UNIBEN), Partner, Benfield Attorneys and Solicitors, Legal Practitioners & Arbitrators, Email: b.oregbemhe@benfieldattorneys.com, www.benfieldattorneys.com, Phone No. 08036986158
1 See Black’s Law Dictionary, Ninth Edition, pg 358.
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and provide additional protection for the weak. Consumer protection laws are a form of government regulation which aims to protect the rights of consumers. For example, a government may require the disclosure of detailed information about products. Consumer protection law is considered an area of law that regulates private relationships between individual consumers and the businesses that sell goods and/or provide services. Consumer protection covers a wide range of topics, including but not necessarily limited to, privacy rights, unfair business practices, fraud, misrepresentation and other consumer/business interactions2
1.5. In the United Kingdom, companies and organisations are permitted by law to make live marketing calls to customers and would-be-customers. However, such companies and organisation cannot make such life marketing calls if the customer had previously told them that he or she does not want to receive calls from them, or the customer registers his or her number with the Telephone Preference Service (TPS) or Corporate Telephone Preference Service (CTPS). In Nigeria, promotion adverts must be in line with the laws and regulation governing advertisements in Nigeria and must comply with the procedural approval before going public or being sent out to subscribers or customers.
2.0. THE RELATIONSHIP BETWEENTELECOMS OPERATORS AND SUBSCRIBERS
2.1. The relationship between a subscriber and a telecoms operator is contractual. The Court of Appeal held in the case of NJIKONYE v MTN NIGERIA TELECOMMUNICATIONS LTD3. Once a subscriber purchases a Subscriber Identification Module Pack (hereinafter referred to as the SIM Pack) from any of the telecoms operators, a contractual relationship is thereby established. The contractual relationship between the subscriber and the telecoms operators is subject to the terms and conditions contained in the SIM pack issued to the subscriber at point of purchase. The subscriber through the regular purchase of airtime and calls, keep the above contractual relationship alive. The said telecoms operator, by crediting the value of the airtime so purchased to the SIM card of the subscriber also acknowledges the existence of the contractual relationship. Furthermore, the telecoms operators impliedly warrant and assure the subscriber’s access to the network unhindered. However, in Nigeria, this is not always the case as
2 Wikipedia
3 (2008) 9 NWLR (1092) 339
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subscribers often times have difficulties accessing their telecoms operators’ network due to network congestion and unavailability.
2.2. A subscriber is entitled to enforce the terms and conditions contained in the SIM Pack imposed by the telecoms operator(s). Once any of the terms and conditions contained in the SIM Pack are breached, the subscriber can directly sue the operators for breach of contract and not through the Nigerian Communication Commission4. However, the Subscriber may if he so chooses seeks redress through the instrumentality of the NCC in accordance with the NCC lay down procedure.
3.0. REGULATORY AGENCIES AND THEIR ENFORCEMENT POWERS IN THE ADVERTISED TELECOMS PROMO IN NIGERIA
A. REGULATORIES AGENCIES
3.1. Section 3 (1) Nigerian Communications Commission Act5 established the Nigerian Communications Commissions (hereinafter the NCC) with responsibility to regulate communication industry/business in Nigeria by the issuance of operating licence and sundry functions. The protection and promotion of the interests of consumers against unfair practices including unfair advertisement of promo by telecoms operators is one of the core functions of the Commission.
3.2. The Nigerian Communications Commission Act and the Nigerian Communications (Enforcement Processes, etc) Regulations 2005 empowered the NCC to make guidelines for minimum standards and requirements in respect of advertisements and promotions of products and services by the telecoms operators in Nigeria6. The NCC pursuant to the above regulatory powers made and published the Nigerian Communications Commission Guidelines on Advertisements and Promotions (hereinafter the Guidelines). Article 2 of the guidelines defined advertisement as follows;
“Advertisement” means any message, the content of which is controlled directly or indirectly by the advertiser, expressed in
4 Njikonye V MTN Nigeria Telecommunications Ltd (2008) 9 NWLR (1092) 339
5 CAP N97 LFN, 2004
6 Section 8 (1), Nigerian Communication (Enforcement Processes, etc) Regulation 2005 provide, the Commission may from time to time, for the purposes of protecting consumers and ensuring ethical marketing and promotional standards by licensees, publish guidelines specifying inter alia minimum standards and requirements in respect of advertisements and promotions of products and services by licensees
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any language and communicated in any medium with the intent to influence their choice, opinion or behavior.’’
While promotion is defined in the said guideline thus;
“Promotion” means any message, the content of which is controlled directly or indirectly by the advertiser, expressed in any language and communicated in any medium with the intent to influence their choice, opinion or behavior in order to receive a reward or benefit.’’
3.3. It is crystal clear from the above definitions that the contents and forms of an advertisement and promotion are solely for the telecoms operators carrying out the promotional advertisement. However, in line with the regulatory and supervisory powers of the NCC in prescribing minimum standards and requirements for promotional advertisements in the telecoms industry in Nigeria, Article 3 of the guidelines laid down the minimum standards and requirements of promotions and advertisements that the telecoms operators must comply with. These minimum standards and requirements are made mandatory and must be complied with at all time if the promotional advertisement must be approved by the NCC.
3.4. The minimum standards and requirements require an operator to attach a detailed report of the advertisement clearly specifying the goods and/or services and the target consumers. The operator shall, if the goods and services on which an advertised claim or representation depends can be tested by survey or data, provide such data which must be reasonably competent and reliable, reflecting the true and accepted principles of such research. The operator must adhere to set standards for quality and grade of service set by the Commission. The operator must also adhere to the set standards on telecommunications products and equipment that are manufactured, imported or sold in Nigeria. The operator shall also adhere to any other standards or requirements of a specific or general nature that may be specified from time to time by the Commission7.
3.5. An operator wishing to make a promotional advertisement after complying with the minimum standards and requirements shall apply, attaching a detailed report of the promotion clearly specifying the goods and/or services and the target consumers to the
7 See Article 3 (a) i, ii, ii,iv &v of the Nigerian Communications Commission Guidelines on Advertisements and Promotions (hereinafter the Guidelines)
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NCC within seven days for approval8 before going public. The approval if granted must be registered with the Consumers Protection Council9 (CPC) within three days of the launch of the promotions10.The philosophy behind the above is to enable the NCC and the CPC prevent exploitation of the consumers of the operators’ products and services. The vending powers of the regulatory agencies are to nip in the bud any abuse such operators may perpetuate on consumers and the general public. It is to enforce complete disclosure of information, free flow of truthful information and prevent unfair practices, fraud and misrepresentation about the prizes and goods to be won. The regulatory agencies must approve the contents of the advert before it is aired or published and advertised to the public.
3.6. In cases where operators wished to give out prizes ranging from cars, houses, aero plane, cash prizes, etc, the existence or availability of these prizes must be ascertained and verified by the NCC and the CPC before approval is granted. For example, for an advertised promotion promising subscribers a new brand aero plane to be approved and registered with the relevant government agencies, the necessary documentation must be exhibited. In the above example, the NCC and the CPC must see to the availability of the aero plan or request for the production of contractual documentations between the telecoms operator involved in the promotion and the aviation company engaged to manufacture the aero plane. The specification, grade, nature, size, type and operating capacity of the aero plane must be certain, and genuine efforts must be in place to produce and/or manufacture it. The NCC and the CPC must liaise with the Nigerian Civil Aviation Authority in this regard before approval and registration respectively because matters of aviation are within the statutory supervision and control of the NCCA11. The above procedure is not always the case as all sort of telecom promos are aired without the necessary approval and clearance from the NCC and CPC.
3.7. The Advertising Practitioners Council of Nigeria Regulations, Procedures and Monitoring states thus;
8 See Article 4 (i) (iii) of the Guidelines. Section 8 (2) of the Nigerian Communication (Enforcement Processes, etc) Regulation 2005 says, Every licensee shall obtain the prior written approval of the Commission in respect of the contents and representations contained in any promotion of products or services whatsoever and howsoever, the failure to obtain such required approval shall constitute a contravention under these Regulations.
9 The Consumer Protection Council (CPC) was established pursuant to section 1 of the Consumer Protection Council Act, CAP C25, LFN, 2004
10 See Article 4 (v) of the Guidelines,
11 Section 31 Civil Aviation Act, CAP C13, LFN 2004
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‘’All consumer promotions are required to be verified by the Advertising Standards Panel (ASP). When applications are made for the verification of any consumer promotion, the promotional items offered prospects in the promotions is/(are) to be assembled for the ASP’s verification, to ascertain that what is being promised consumers by the advertisers/promoters are actually on ground before approval is given to any promotion. This ensures that the consumers are not deceived.’’ (Emphasis supplied)
3.8. It is clear from the above that the existent of the promotional items must be verifiable and certain. This is to prevent fraudulent, dishonest and untrue promotional advertisements.
3.9. There is clear distinction between promotion and lottery in the telecommunication industry in Nigeria. The popular ‘’BUY ONE, GET ONE FREE’’ where subscribers are asked to purchase a particular call credit and get certain percentage is an example of ‘’promo’’. However, when the promoter/advertiser selects winners through lot, scheme etc; it therefore becomes a promotional lottery. Example of promotional lottery is when a telecoms operators promises items (such as cash prizes, cars, aero plane, etc) to be won by the subscribers by luck or chance. In the above instance, the operators benefits from the increase in purchase of its products and services during and after the ‘’promo’’ however, Section 57 of the National Lottery Act defined Lottery to
“includes any game, scheme, arrangement, system, plan, promotional competition or device for the distribution of prizes by lot or chance, or as a result of the exercise of skill and chance or based on the outcome of sporting events, or any other game, scheme, arrangement, system, plan, competition or device, which the President may by notice in the Gazette declare to be lottery and which shall he operated according to a license;
3.10. When the promotional advert is tantamount to a lottery, the promoter/advertiser shall register with the National Lottery Regulatory Commission12 for a permit and/or licence13.
12 Section 1 National Lottery Act, CAP LFN, 2004
13 Section 17 National Lottery Act, As from the commencement of this Act, the operation of the business of a national lottery or any lottery, by whatever name called, shall be subject to a License granted by the President upon recommendation by the
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4.0. ENFORCEMENT POWERS OF THE REGULATORY AGENCIES
4.1. The NCC, CPC, National Lottery Regulatory Commission, Advertising Practitioners Council of Nigeria regulate and enforce compliance with the laws and regulations for promotional adverts in telecoms industry and general advertisements in Nigeria. The above mentioned regulatory agencies may on their own initiative or on application by an aggrieved consumer commence enforcement for any breach of any of the regulations or terms and condition imposed on certificate for grant for the promotional adverts. The sanctions to be imposed on defaulting operators include but not limited to (1) fines (2) penalty, (3) withdrawal of licence/permit (4) institution of civil proceedings, etc.
4.2. One may ask what the NCC, CPC, Advertising Practitioners Council of Nigeria (APCON) and other regulatory agencies are doing about the unsolicited commercial and nuisance calls in the form of advertisement by telecoms companies and Tele-Marketers in Nigeria. The above cited laws and regulations mandated all telecoms companies operating in Nigeria to register the contents of any advertisement with the relevant agencies before going public with any promotional adverts. However, it would be observed that the laws and regulations are honoured more in the breach by the telecoms companies. It is argued that making a direct and unsolicited commercial and promotional calls and text messages to a subscriber without the approval of the relevant regulating agencies is a breach of the laws for which a violator is liable to punishment and necessary sanctions.
5.0. RIGHTS OF CONSUMERS
5.1. It is argued that consumers of telecoms services are entitled to the right to be given the facts needed to make an informed choice, right to be protected against dishonest or misleading advertisement and the right to get truthful and honest information about the promotional items. This is aim at preventing fraudulent and unwholesome practices by the advertisers/promoters of these services.
5.2. A subscriber winner in an advertised telecoms promo is entitled to sue for the ‘’prize’’ in the event that the ‘’promoter’’ fails, refuses and neglects to hand over the ‘’prize’’ to the winner(s). The subscriber winner can base his action on breach of contract and enforce performance on the part of the ‘’promoter’’. The promotional advert is tantamount to an
Commission and compliance with the provisions of this Act or any regulations made pursuant thereto. The various State Lottery Commission also grant permit/licence within their jurisdiction.
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offer made to the whole world and acceptance of the offer is participating in the promo, see CARLILL V CARBOLIC SMOKE BALL COMPANY [1893] Q.B. 256. The existence of the contract is more pronounced under the telecoms promo by the act of the promoter ‘’picking or selecting’’ a winner either by ‘’a lucky dip’’ or by ‘’lot or chance, or as a result of the exercise of skill and chance or based on the outcome of sporting events, or any other game, scheme, arrangement, system, plan, competition or device.’’
5.3. However, the subscriber winner can through the NCC, CPC, National Lottery Commission enforce performance by the promoter. The above agencies may withdraw the licence issued to the telecommunication to operate or refuse to approve its application for permission for promo. They can compel the promoter to deliver or hand over the ‘’prizes’’ to the subscriber winner(s) and use all legitimate means within their disposal to compel the promoter including civil proceedings.
5.4. A subscriber is entitled to his privacy and one would venture to say that receiving unsolicited commercial and nuisance marketing or promotional calls at odd hours is tantamount to a violation of this right. A right to privacy carries with it a right not to be unduly and unnecessarily disturbed.
6.0. UNSOLICITED COMMERCIAL CALLS AND SMS MESSAGES ADVERTISING GOODS AND SERVICES.
6.1. In the United States of America, the Telephone Consumer Protection Act of 199114 (TCPA) which was passed in 1991 restricts telephone marketing or solicitations. The TCPA 1991 prohibits telemarketer(s) from unsolicited commercial calls and/or text messages if the recipient asked not to be called or sent a text message. In the event of violation of the TCPA, a subscriber may sue for damages for violation and may also seek an injunction against the telemarketer(s). Section 227 of the TCPA 1991 of the United States of America states in part thus;
‘’ It shall be unlawful for any person within the United States–
(A) to make any call (other than a call made for emergency purposes or made with the prior express consent of the
14 Public Law No. 102-243, 105 227
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called party) using any automatic telephone dialing system or an artificial or prerecorded voice-
(i) to any emergency telephone line (including any `911′ line and any emergency line of a hospital, medical physician or service office, health care facility, poison control center, or fire protection or law enforcement agency);
(ii) to the telephone line of any guest room or patient room of a hospital, health care facility, elderly home, or similar establishment; or
(iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call;
(B) to initiate any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party, unless the call is initiated for emergency purposes or is exempted by rule or order by the Commission under paragraph (2)(B);
(C) to use any telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine; or
(D) to use an automatic telephone dialing system in such a way that two or more telephone lines of a multi-line business are engaged simultaneously.’’
6.2. The constitutionality of the TCPA was challenged in the case of Moser v. FCC 15and the court upheld its constitutionality. In the case of Moser v. FCC (supra), the Court of Appeals, 9th Circuit held thus;
‘’The provision in the Telephone Consumer Protection Act of 1991 banning automated, prerecorded calls to residences is content-neutral. Congress adequately demonstrated that such
15 46 F.3d 970 (9th Cir. 1995)
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calls pose a threat to residential privacy. The ban is narrowly tailored to advance that interest, and leaves open ample alternative channels of communication. Thus, it does not violate the First Amendment.’’
6.3. See also the case of Destination Ventures Ltd. v. FCC16. The TCPA 1991 applies to unsolicited Short Message Service (SMS) advertising the commercial availability of goods or services. In the United State of America, an unsolicited commercial calls and text messages are unlawful and a breach of the law. In this regard, anybody whose right to privacy had been violated by unsolicited commercial calls or text messages is entitled to sue under Section 227 (3) (a), (b), (c)17. However, it is permissible to make a live call as the law only prohibits automatic telephone dialing system or an artificial or pre-recorded voice. The United States of America famous pizza chain Papa John’s is currently facing a $250 million class action in lawsuit for sending illegal commercial text messages to customers in violation of the TCPA 1991. The commercial text messages are alleged to have been sent by pizza franchises to Customers without their consent.
6.4. In India, the Telecom Regulatory Authority of India (TRAI), under The Telecom Unsolicited Commercial Communications Regulations, 2007 (4 of 2007) amended by The Telecom Unsolicited Commercial Communications (Second Amendment) Regulations, 2008, (No. 3 of 2008) had barred unsolicited commercial calls and text messages between 9pm and 9am and has also barred Tele-marketing firms from making commercial calls or sending commercial text messages to Subscribers who had registered their numbers with a “national do not call” (NDC) list. The India Regulatory Authority imposed heavy fine on defaulters. In the United Kingdom, Tele-Marketers are barred from commercial live call if a customer or a subscriber has previously indicated that he or she does not want to be called or he or she registers his or her number with the Telephone Preference Service (TPS) or Corporate Telephone Preference Service (CTPS).
6.5. However, in Nigeria, there are no specific regulatory guidelines in respect of unsolicited commercial calls and texts messages and Tele-Marketers and Telecom Providers bombard Subscribers with unsolicited commercial and nuisance calls and text messages
16 46 F.3d 54 (9th Cir. 1995)
17 Public Law No. 102-243, 105 227
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even at odd hours. These calls and text messages, as stated earlier are annoying and frustrating due to their frequency and timing.
7.0. CONCLUSION
7.1. In conclusion, if the necessary governmental agencies involved in regulating adverts in Nigeria are up to their responsibilities by enforcing strict compliance with the laws and regulations, the telecoms industry will be better sanitized and the consumers protected against fraudulent and unfair practices. The National Assembly should enact an Act in line with the US CTPA 1991 so as to protect the privacy of consumers against unsolicited commercial calls and text messages. In the alternative, the NCC should pursuant to the provisions of the Nigeria Communications Commission Act make and publish guidelines in respect of unsolicited advertisements in the form of unsolicited commercial calls and text messages by telecom companies and Tele-Marketers in Nigeria. Nigeria is one of the largest users of telecoms products and services in Africa and the world at large and her legal regime should be in line with the international best practices in the communications industries and advertising.

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