The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has proposed sweeping rules to strengthen competition in the sector. The proposed Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations, 2026, aims to regulate how petroleum companies use pipelines, terminals, storage facilities, pricing information, commercial contracts, and digital platforms. This move is designed to create a more transparent and efficient petroleum market while protecting investors and consumers.
The proposed regulations were first formally released for public consultation on August 6, 2026, when the NMDPRA issued a public notice inviting licensees, permit holders, and other stakeholders to submit comments within 21 days. The consultation was undertaken pursuant to Section 216(1) of the Petroleum Industry Act 2021, which requires the Authority to consult stakeholders before finalising its regulations. This came shortly after concerns were raised in the downstream petroleum market over alleged coordinated pricing by some fuel importers.
Speaking at a stakeholders' consultation forum on the proposed regulations in Abuja, NMDPRA Chief Executive, Rabiu Umar, said the framework was designed to prevent anti-competitive practices, address abuse of dominance, and promote fair and non-discriminatory access to essential infrastructure. Umar said the consultation was an opportunity for the Authority to engage with industry stakeholders and benefit from their practical experience. He encouraged participants to identify specific provisions that may require clarification or refinement and suggest practical alternatives.
The proposed framework contains 138 regulations across 23 parts, according to the NMDPRA Legal Adviser, Joseph Tolorunse. The rules go beyond conventional price-fixing restrictions to cover infrastructure access, dominant firms, vertical integration, mergers, digital markets, enforcement, penalties, and coordination between regulatory agencies. Tolorunse said the regulations would translate the competition provisions of the Petroleum Industry Act 2021 into detailed, enforceable rules for the midstream and downstream petroleum sectors.
Under the proposed rules, companies would be prohibited from coordinating pump prices, ex-depot prices, margins, discounts, freight charges, supply levels, territories, customers, and tender submissions. The draft also targets informal or tacit agreements, meaning companies could face regulatory scrutiny even where anti-competitive conduct is not contained in a formal written agreement. The regulations would also prohibit owners or controllers of essential infrastructure from unjustifiably denying or delaying access to qualified third parties.
The proposed rules come against the backdrop of renewed concerns over competition and pricing in the downstream petroleum market. In August, the NMDPRA opened a 21-day consultation on the draft, specifically highlighting concerns around price fixing, market allocation, bid rigging, coordinated supply restrictions, price signalling, and the exchange of commercially sensitive information. The Petroleum Industry Act already provides the statutory foundation for competition regulation in the midstream and downstream sector.
The new regulations would build a more detailed sector-specific competition regime around the provisions of the Petroleum Industry Act. The framework would also scrutinise exclusive supply agreements, long-term contracts, take-or-pay arrangements, tying and bundling, loyalty rebates, minimum-volume commitments, resale price maintenance, and franchise restrictions where such arrangements could substantially reduce competition. Dominance itself would not be prohibited, but its abuse would be.
Key points
- The Federal Government aims to strengthen competition in Nigeria's midstream and downstream petroleum sector through the proposed regulations.
- The proposed regulations target anti-competitive practices, including price-fixing, market sharing, and abuse of dominance.
- The regulations would promote fair and non-discriminatory access to essential infrastructure and enhance transparency and market efficiency.
