Predatory Pricing Under the Federal Competition and Consumer Protection Act of 2019 of Nigeria: An Unfinished Business

Abstract

Predatory pricing is one of the market practices that are prohibited in competition law. It occurs when a dominant firm sells its product at an unreasonably low price in order to eliminate competitors from the market. The Federal Competition and Consumer Protection Act, 2019 of Nigeria prohibits this practice. This article, therefore, examines predatory pricing under the Act. It argues that the prescription of the cost-based principles of marginal and average cost as sole determinants of predatory pricing under the Act would not provide the Federal Competition and Consumer Protection Commission (FCCPC) and courts with the appropriate legal standard in determining predatory pricing. It suggests that the provision of the law should be reformed to include the principle of recoupment as a legal standard for imposing liability for the practice against defaulting firms. This will assist the FCCPC and courts to distinguish pro-competitive predatory pricing from anticompetitive predatory pricing.