By David Akinmola
The Nigerian Communications Commission (NCC) is considering a review of the Annual Operating Levy (AOL) paid by telecommunications licensees, as part of efforts to increase compliance and ensure a more robust regulatory environment within the sector.
The AOL is a statutory fee charged to telecom companies operating in Nigeria. Currently, network operators are required to pay 2.5% of their net revenues, while non-network licensees pay 1% of their gross revenues to the NCC. The fee is calculated after deductions for certain operational costs such as bandwidth, roaming, and interconnect fees.
The proposed review comes amid concerns over a decline in compliance levels, despite a notable increase in overall AOL collections. According to a Regulatory Impact Assessment (RIA) report on Subsidiary Legislations 2024, released by the NCC’s Legal and Regulatory Services Department, the AOL collection rate rose by 22.9% after the last regulation update in 2022. However, compliance among operators dropped from 28% in 2022 to 26% in 2023.
The Commission also disclosed that it carried out 45 enforcement actions in 2023, up from 21 in the previous year, underscoring the growing need to tighten oversight and drive accountability across license categories.
In the RIA report, the NCC highlighted the need to “expand the AOL collection bucket” and create a compliance roadmap that would bring all licensed entities under the purview of efficient monitoring and contribution.
Speaking at a stakeholders’ forum where the report was presented, NCC’s Executive Vice Chairman, Dr. Aminu Maida—represented by Chizua Whyte, Head of Legal and Regulatory Services—emphasized that the RIA process was designed to give industry stakeholders a platform to provide feedback and influence the regulatory framework.“These enhancements will ensure the effective application and implementation of our subsidiary legislations. The NCC is fully committed to building a telecommunications landscape that is fair, transparent, and centered on consumer welfare,” Maida said.
Whyte added that the completed RIA would guide the NCC’s ongoing regulatory reforms, aligning outdated laws with current industry realities and future innovation trends.“Through this process, we have identified gaps, clarified obligations, and removed obsolete provisions that may hinder innovation or investment. Our findings reflect the input of industry stakeholders, whose insights have been invaluable in shaping the recommendations,” she stated.
The review examined key regulatory areas including licensing, SIM registration, subscriber data management, spectrum trading, enforcement, and infrastructure sharing. The NCC believes that reforming these elements will not only enhance regulatory compliance but also lower entry barriers and stimulate investor confidence.
As the Commission prepares for the next phase of reform, stakeholders await the final outcome of the proposed levy review, which could significantly impact how telecom operators fulfill their financial obligations and regulatory responsibilities.
