That Court Ruling On Deregulation

On Tuesday, March 19, 2013, a landmark judgment that leaves behind some far-reaching socio-economic consequences on the Nigerian state was delivered by a Federal High Court sitting in Abuja.

The presiding judge, Justice Adamu Bello, had declared as unconstitutional, illegal null and void, the Federal Government’s planned deregulation of the downstream petroleum industry on account of the fact that the policy violates the provision of Section 4 of the Price Control Act, Cap P.28 Laws of the Federation of Nigeria, 2004.

The Federal Government has long sought to deregulate the downstream oil sector by allowing prices of petroleum products to be determined by the regular interplay of demand and supply as is the international practice.

It is, indeed, for this reason that government has continued to insist on the complete removal of subsidies on petroleum products.

The last bold attempt at subsidy withdrawal was on January 1, 2012 when President Goodluck Jonathan, in a New Year broadcast to the nation, announced the Federal Government’s decision to increase the pump price of petrol from N65.00 to N141.00.

This singular pronouncement sparked off a week-long nationwide workers’ strike and sporadic riots across the country, forcing the government to beat a hasty retreat by coming up with a more acceptable price of N97.00 per litre after a round of rushed parleys with Labour representatives and some state chief executives.

But even as these events were playing out, a Lagos-based lawyer and human rights activist, Mr. Bamidele Aturu, went to court to challenge the Federal Government’s attempt to hands-off the fixing of petroleum products prices contrary to the provisions of the Petroleum Act and the Price Control Act.

Aturu had in his suit which also joined the Minister of Petroleum Resources and the Attorney-General of the Federation as co-defendants, prayed the court to determine whether the government’s deregulation policy would not make freedom of movement guaranteed by Section 41 of the 1999 Constitution illusory for the generality of Nigerians.

In addition to granting the plaintiff’s prayers in full, the judge also ordered the Federal Government to continue to fix, regulate and regularly publish prices of petroleum products across the country.

With the court ruling, it will appear that the Federal Government cannot necessarily allow the industry operators to determine the prices of petroleum products as that will amount to flouting the Price Control Act.

To cross such hurdles, government must do the right things because lack of action on this matter could spell doom for the economy. The first step should be to amend the Petroleum Act and the Price Control Act through the National Assembly, in addition to persuading the Legislature to treat expeditiously, the passage of the Petroleum Industry Bill (PIB).

With the myriad of problems which Nigeria faces today, the court ruling which tends to question a major economic policy as the deregulation of the downstream oil sector cannot be treated with levity.

Even so, The Tide commends the presiding judge for his rare demonstration of judicial erudition without which some of the facts in the country’s existing statutes would have been taken for granted and only spell later-day doom.

Considering the Federal Government’s attachment and commitment to the policy and that it even allowed such a judgment to be delivered in the first place, portends a very good omen for the country’s judiciary.

This is why we commend the government, particularly the President, for demonstrating commendable neutrality in spite of his administration’s determination to deregulate the downstream petroleum sector, and for that reason refraining from interfering with the judicial process and allowing the rule of law to take its honourable course.

In fact, coming at a time when the President was preparing to hold consultations with Nigerians on how best to achieve his government’s subsidy withdrawal policy, nothing can better attest to his neutrality in this particular court ruling.