Court Nullifies NBC Code, Gives Broadcast Industry Hope

Media

The recent judgment of the Federal High Court in Lagos that nullified the amendment to the 6th Edition of the National Broadcasting Commission (NBC) Code is a huge relief to the creative industry, Vanessa Obioha writes

There was jubilation in the creative industry, particularly the broadcast and advertising sectors last week when the Federal High Court in Lagos nullified the amendment to the 6th Edition of the National Broadcasting Commission (NBC) Code.

Justice Ambrose Lewis-Allagoa who delivered the judgment, in a suit filed by a Lagos-based journalist, Mr. Femi Davies, declared that NBC lacks the power to prohibit exclusivity on privately acquired intellectual property rights in programme contents of a right-holder vis-a-vis the salient provisions of the constitution and the copyright act.

The judge also held that NBC acted beyond its powers in seeking to regulate the practice of advertising in Nigeria contrary to the provisions of the extant Advertising Practitioners (Regulation) Act of 2004.

He, consequently, set aside the proposed amendment to the 6th Edition of the NBC Code for being ultra vires, incompetent null, and void, and perpetually restrained the commission from implementing it.

On August 4, 2020, the Minister of Information and Culture, Alhaji Lai Mohammed, launched the amended 6th edition of the broadcasting code. The code seeks to regulate content exclusivity, enforce content sharing and empower NBC to determine prices at which content is sold to sub-licensees by rights holders.

Talks to amend the 6th edition of the NBC code in due course have always been ongoing, and in 2017, a full stakeholders’ consultative forum was held, with the Board, Information Ministry representatives and over 60 industry stakeholders in Kano. The outcome of that meeting was subjected to due process and a final draft of the document was made available for further input before the final amendment to the Code would be ratified and published.

However, in the heat of the 2019 general election, a president-cum-Federal Executive Council tasked the minister in charge to come up with policy reforms to check future infractions, having noted a few. But the document, which was finally published in 2020, allegedly omitted the contributions of others and was supposedly a weapon for the minister.

Indeed, when NBC released the amended code, it generated a lot of reactions in the broadcast industry, with stakeholders vehemently criticising it. Copyright activists opined that even though some of the provisions of the code were good, some were unworkable while others were unconstitutional. They stated that NBC was attempting to overreach itself by assuming powers of the National Assembly and called for a revisit of those amendments.

But despite opposition from several bodies, the federal government said it would go ahead with the implementation.

This angered the plaintiff, Femi Davies, who challenged the code in suit FHC/L/CS/1152.2020 with the NBC as the defendant. Davies argued, among others, that if allowed, the amendment would violate his right to a fair hearing. He prayed the court to uphold his six prayers as set out in his originating summons.

The plaintiff’s reliefs included a declaration that the commission lacks the power to prohibit exclusivity on privately acquired intellectual property right in programme content of a right-holder vis-a-vis the salient provisions of the constitution and the Copyright Act.

During his argument in court, Davies had approached the court contending among other things that the amendment sought by the defendant to the 6th edition of the Nigerian Broadcasting Code is in violation of his rights to own intellectual property in Nigeria over which he can exercise exclusive rights.

He had also argued that the amendment, if allowed, will greatly affect business and the development of the country as a whole as it will frustrate tonnes of investment and hard work of many years.

On its part, the NBC submitted that the amendment to the 6th broadcasting code was done to protect local operators, promote creativity and maximise local content due to the antitrust provisions contained in the amendment. It also claimed that the amendment was intended to among other things stimulate growth in the industry and attract foreign investment which would benefit the media industry generally.

In his judgment, Justice Lewis-Allagoa held that the proposed amendment is a violation of the principle of fair hearing and natural justice, adding that the acquisition of exclusive rights to broadcast a particular programme is an investment for returns which no one should be forced to surrender same when it is lawfully acquired.

“I agree with the submission that acquisition of exclusive rights to broadcast a particular programme is an investment for returns and by virtue of the above-stated provisions, no one should be forced to surrender same when it is lawfully acquired…

“I am in agreement with the plaintiff counsel that the said proposed amendment is a violation of the principle of fair hearing and natural justice. The proposed amendment purports that the defendant NBC shall without any fact-finding or recourse to the other party place the advertising agency on its black list, solely based on the complaint of a media house to the defendant and the defendant acting has the authority to itself shall pass its verdict without hearing the other parties.

“I have determined the questions in the originating summon in favour of the plaintiff. For reasons hereinbefore given, consequently, all the reliefs sought by the plaintiff are granted as prayed. That is the judgment of the court,” the judge held.

The court’s judgment deflated NBC’s ego given that in 2020, it boasted that nothing would stop it from amending the 6th edition of the broadcasting code. It claimed that the decision to amend the code was taken to reposition the Nigerian broadcasting industry and make it more responsive to emerging realities in the broadcasting industry.

Before the suit,  then Acting Director-General of NBC, Prof. Armstrong Idachaba, at a press briefing in Abuja, said part of the objectives of the amendments was to protect and promote the local broadcast industry from monopolistic and anti/ competitive behaviour; the stimulation of advertising revenue into the broadcast industry and by extension the local creative industry.

For him, these objectives remain key and central to the development of broadcasting in Nigeria and the reform of the broadcasting industry. While acknowledging the mixed reactions to the release of the amendment, the DG stated that the Commission would consider them for the growth and development of the broadcast industry in Nigeria.

Idachaba, who decried the challenges confronting local broadcasters in the country vowed to protect their interest through the implementation of the new code.

‘‘The commission wishes to reiterate the fact that the objectives of the amendments are in our national best interest,” Idachaba said at the time. “We currently have a highly rated and hugely talented creative industry in Nigeria but the facts remain that content producers are unable to harness the benefits of their creative endowment due largely to monopolistic restrictions and anti-competitive behaviour.

‘‘There is no doubt that the Nigerian broadcasting industry is facing a series of challenges. These include the inability of the broadcasters to generate required funds from advertising and programming. Local producers of content are no longer able to create content for television. This has led to an influx of foreign production companies, some of them unregistered and unlicensed by the Nigerian government.

‘‘These companies have taken over the local content production space and by extension the advertising and broadcasting space, relegating the local entrepreneurs to oblivion. The commission believes in DFI in the broadcasting industry but this must be done with the noble philosophy to promote our own national dreams and vision,” he said.

The 6th amendment also sent waves of shock to content streaming service providers such as Netflix and Amazon who were barely establishing their presence in the country. Pay television channels such as iROKOtv, and Africa Magic considered halting further investments in the Nigerian content industry.

The four platforms, THISDAY gathered, were forced to consider discontinuation of investments in Nigeria. It was gathered that the four platforms which have invested enormously in local content production that are exclusive to them, are convinced that the new broadcast code is a huge threat to their investments, as it seeks to end exclusivity to broadcast properties and compel re-sale or sub-licensing to other broadcasters, including direct competitors.

Sources said the new code makes exclusivity illegal, compels content sub-licensing, and aims to regulate the prices at which content is sub-licensed. According to an industry source, the broadcast platforms view Sections 9.0.1 to 9.0.3 of the broadcast code represent a direct assault on investors, as it erodes the possibility of reaping dividends on their investments.

“These sections prohibit broadcasters from entering into rights acquisition agreements that do not allow the sub-licensing of such rights in Nigeria. The implication is that any such agreement entered into is void,” she explained.

An Enugu-based industry source who pleaded anonymity also reasoned that Sections 9.1.1.8 to 9.1.1.11 of the Code are most injurious to investors in the industry. The sections provide that a broadcaster must sub-license a programme in any genre if such enjoys massive viewership among Nigerians.

The implication of this, explained the source, is that investors, who fund the development of hit movies, series, and shows, will be forced to sub-license that programme irrespective of whether or not they have recouped their investments.

“This isn’t just silly, but also wicked. It amounts to uncompensated use of intellectual property. The proper thing is for a broadcaster to freely bid for, negotiate or acquire rights at prices dictated by the market and on terms acceptable to channel suppliers,” he said.

He further explained that forced sub-licensing will inhibit investments, especially by foreigners in the content creation and broadcasting industry.

“I wasn’t surprised to learn that Netflix and Amazon are fretting. They should fret because they have invested heavily in the acquisition of Nigerian content. They are yet to recoup their investments, but you’re saying they must sell to competitors. Do you think other investors will be encouraged to come and invest? No. Africa Magic has spent tons of money buying and creating local content. They are right to panic. So is iROKOtv,” he said.

A former content producer explained that the broadcasting industry is already a difficult terrain to operate and has been made worse by the new code. He stated that NBC was seeking to turn a private enterprise into state property and be the one to determine the scale of dividends an investor should reap on his investment.

He argued that broadcasters would invest only if they are certain that the content on their platforms will help differentiate their offerings and they are able to sufficiently recoup what they invested. He warned that NBC’s interference in broadcasters’ freedom to trade would discourage investment in the broadcasting industry. This, in turn, he said, will have a negative impact on the production sector and the wider economy.

But with the recent court ruling, creatives can breathe a breath of fresh air and perhaps, work with the commission to amend the code appropriately.