Introduction
Three competing cooking gas distributors in Lagos agree to replace their diesel delivery fleets with electric vehicles. They share logistics infrastructure and accept a temporary non-compete in respect of delivery routes, because no single distributor could justify the capital investment alone. Their customers are households, many of them low income, for whom cooking fuel is a large and inelastic share of expenditure. They cannot buy much less of it when the price rises.
On any orthodox reading, competitors who agree not to compete over routes have formed a cartel. This arrangement could nonetheless qualify for authorisation under a new environmental sustainability limb at Paragraph 21 of the Federal Competition and Consumer Protection Commission's Explanatory Guidelines to the Authorisation, Exemption and Guidance Regulations (Non-Merger Matters), 2026, published as an exposure draft in April 2026 (the "Exposure Draft") [1]. The Federal Competition and Consumer Protection Commission (the "FCCPC" or the “Commission”) would assess it favourably under section 60 of the Federal Competition and Consumer Protection Act 2018 (the "FCCPA"). It would find the restriction indispensable, meaning that the environmental benefit could not be achieved by any less restrictive route.
Now let us vary a single fact. Suppose the electric fleet costs more to run over the relevant period than the diesel fleet it replaced, and suppose the increment reaches the cylinder price. Nothing else changes. The restriction is the same, the environmental benefit is the same, the indispensability finding is the same. What has changed is that a group of low income households now pays a premium on an essential good in exchange for a diffuse and delayed climate benefit shared with more than two hundred million other Nigerians.
The question being confronted, therefore, is: when a competition authority relaxes the consumer benefit condition to accommodate climate objectives, whose consumers is it counting? What follows when the people who pay the premium are not the people the climate benefit is designed to protect?
The European debate on sustainability agreements has developed with unusual care along two axes. First, which market the benefits must accrue in, and second, over what time horizon they may be counted. A third axis has gone almost entirely unexamined. Which population? Every framework in circulation states its beneficiary class in national terms: UK consumers, EU consumers, Nigerian consumers as a whole. None asks what happens when the emitting population and the paying population diverge.
Where the Doctrine Comes From
Three European positions were on the table when the FCCPC drafted, and they differ in how far benefits falling outside the affected market may count.
The EU baseline: benefits must reach the people who pay
Chapter 9 of the European Commission's revised Horizontal Guidelines sets the baseline [2]. Sustainability agreements that restrict competition may be exempted under Article 101(3) of the Treaty on the Functioning of the European Union (“TFEU”), the provision that lets an otherwise prohibited agreement through where it delivers offsetting benefits. Benefits must accrue to consumers in the affected market, or in a market substantially overlapping with it. Benefits to society at large do not substitute for benefits to the consumers who bear the restriction.
The Horizontal Guidelines also introduce a soft safe harbour for sustainability standardisation agreements, meaning agreements that set a common environmental standard rather than fix price, output or territory. The safe harbour is available where six cumulative conditions are met, including a combined market share of no more than twenty per cent. The EU therefore accommodates climate objectives within the existing architecture rather than carving an exception out of it, and it keeps the beneficiary class tethered to the group that pays.
The CMA's position
The Competition and Markets Authority's Green Agreements Guidance does something materially different from the EU [3]. It creates a distinct sub-category of climate change agreements. For that sub-category alone, it assesses the fair share condition against the totality of benefits to all UK consumers, without apportionment between consumers inside and outside the relevant market. Biodiversity and water agreements remain subject to the in-market test. The carve-out is wide in effect, because within its scope it severs the link between the group bearing the restriction and the group whose welfare justifies it.
The Dutch position
The Dutch experience is usually invoked in shorthand as evidence that sustainability doctrine licenses welfare cartels. It shows the opposite.
The Netherlands Authority for Consumers and Markets (the "ACM") adopted a Policy Rule on its oversight of sustainability agreements in October 2023. The Rule retains flexibility for what it terms environmental-damage agreements, and the ACM has applied that flexibility to cooperation on carbon dioxide storage and to the removal of plastic handles from multipacks [4]. But in its 2015 analysis of the "Chicken of Tomorrow" arrangements, the ACM refused the sustainability justification [5]. Conjoint analysis, a survey technique that measures what consumers will actually trade off and therefore what they will pay, did not cover the price increase the arrangements would produce. The agreement failed the consumer benefit test. The Dutch reformed their framework in response to that failure, and subsequent commentary reads the case as a collision between animal welfare and consumer welfare as a legal standard [6].
The lesson is therefore that the evidential condition, properly applied, can defeat a well-intentioned agreement. It did so in a market of Dutch consumers whose willingness to pay was measurable, whose preferences were surveyable, and whose regulator had the analytical capacity to run the exercise.
Agriculture as an exclusion
Article 210a of the Common Market Organisation Regulation goes further than any of the above. As elaborated by the EU Commission guidelines adopted on 7 December 2023, it excludes from Article 101 TFEU altogether agreements between agricultural producers applying sustainability standards above those required by law [7]. The exclusion extends upstream and downstream of the producer level, and the Commission may intervene only after the event.
For an argument about agricultural inputs in African markets, this is the most important European instrument on the map. It shows that the European legislator has already been willing to take sustainability agreements in the food chain outside the prohibition entirely, subject only to after-the-fact correction. BEUC, the European consumer organisation, set out the consumer-side objection during the consultation, and it is precisely the objection this brief generalises. An exclusion removes the mechanism by which the interests of those paying the premium are represented at the point of assessment [8].
The implications of the FCCPC’s Exposure Draft
The Exposure Draft is careful, well-informed and, at two points, wider than anything in Europe. Section 2.1.4 of the Exposure Draft is devoted to environmental sustainability and climate-change mitigation.
Paragraph 15 surveys the EU, UK and Dutch approaches by name, and accurately, including the EU's twenty per cent share threshold. Paragraph 16 then makes a choice, and it is the UK choice rather than the EU one. Where an agreement is specifically directed at climate-change mitigation, the Commission considers it appropriate to assess the consumer benefit condition by reference to the benefits to "Nigerian consumers as a whole, not limited to consumers in the relevant market."
Paragraph 16(b) of the Exposure Draft gives three justifications. The first is the statutory framework, being section 1(e) of the FCCPA and the National Climate Change Act 2021 taken together, which the Commission reads as a legislative determination that climate action benefits all Nigerians. The second is that an applicant cannot realistically show that consumers in a narrowly defined product market receive a fair share of a diffuse climate benefit.
The third justification carries the weight, and it is the sentence this brief is about. The Commission reasons that the effects of greenhouse gas emissions "are not confined to any product market or geographic region," and affect all Nigerian consumers through their impact on agricultural productivity, public health, energy security and economic resilience.
That proposition is correct. It is also a proposition about where the harm falls. The Commission uses it to justify widening the class of persons whose benefit may be counted, without asking anywhere whether the burden is similarly unconfined. Climate harm falls on everyone, and that is a good reason to think the benefit reaches everyone. However, it says nothing about who pays. The whole of the argument that follows sits in that gap.
The Exposure Draft contains four distinct safeguards. Each of the safeguards polices the quality of the evidence or the structure of the analysis. None polices who receives the benefit.
Paragraph 14 keeps environmental benefits inside the section 60 framework rather than letting them stand as a freestanding justification, treats sustainability as an input to the analysis rather than a substitute for it, and excludes speculative or hypothetical claims. Paragraph 19(d) stops environmental benefits from curing a failure on any other condition and requires the Commission to test less restrictive means, including voluntary standards, unilateral commitments and regulatory measures. Paragraph 19(e) refuses to lower the evidential burden merely because the stated objective is environmental, which is the Chicken of Tomorrow lesson imported expressly alongside the doctrine it qualifies. Paragraph 17 works on a different plane, taking four categories of environmental cooperation outside section 59 altogether so that no application arises and the doctrine has less ground to govern.
Taken together, these answer the obvious criticism, which is that a sustainability limb licenses anything carrying a green label. They do not answer the question paragraph 16(b) opens. An agreement can satisfy all four while its cost falls on a population receiving none of the benefit counted in its favour, because each of the four asks whether the benefit is real and none asks where it lands.
However, Paragraph 20 is where the pattern breaks. It floats a block exemption for sustainability standardisation agreements, meaning a standing permission granted in advance to a whole class of agreements without individual application, and equips it with safeguards that are entirely qualitative and procedural: transparency and openness of the standard-setting process, non-discriminatory access to the standard, proportionality of the requirements, and preservation of competition on other parameters. There is no market share limb. That omission is a choice rather than an oversight, because paragraph 15(a) sets out the EU's twenty per cent threshold accurately two pages earlier. The Commission had the figure in front of it and did not carry it across. The one instrument in the section that operates without case-by-case scrutiny is therefore also the only one carrying no quantitative limit on who may invoke it.
Two observations follow. First, on the searchable literature as at the date of writing, the draft is uncommented. It is a consultation document that nobody has yet read against its donor instrument. Second, Nigeria has taken the widest available version. It could have taken the EU position, which was on the table and expressly surveyed at paragraph 15. It took the UK position instead, into a jurisdiction with a fraction of the United Kingdom's welfare-state cushioning, a materially lower average consumer income, and no equivalent of the transfer mechanisms through which a British household experiencing a green premium may be partially compensated elsewhere in the fiscal system.
The most revealing paragraph in section 2.1.4 is the one that applies it. Section 2.1.4 contains one worked example of its new rule, and that example does not use it.
Paragraph 16(b) creates the national beneficiary class for climate-change mitigation agreements. Paragraph 16(c) deals with everything else. It applies the standard in-market test, while recognising that environmental improvements may produce indirect consumer benefits, and gives as its example improved air quality reducing health costs "for consumers in the affected area."
Paragraph 21 is a climate-change mitigation agreement. It is the electric delivery fleet, and its stated benefits are reduced urban air pollution and lower carbon dioxide emissions. One would therefore expect the Commission to resolve the consumer benefit question by reference to Nigerian consumers as a whole. It does not. It resolves the question by reference to improved air quality for Lagos residents, including consumers of the parties' products. That is the paragraph 16(c) route applied to a paragraph 16(b) agreement. The class is neither national nor strictly in-market. It is a localised population that happens to contain the affected consumers, and the benefit relied on is a local air-quality co-benefit rather than the climate benefit the widened class was written to accommodate.
The Gap in the Literature and in Practice
The integrationists argue that competition law should carry environmental objectives, and that the narrow consumer welfare reading is wrong as a matter of law, economics and morality [9]. The economic sceptics argue the opposite. Schinkel and Treuren show that firms permitted to coordinate green investment have incentives to reduce that investment below the competitive level, producing cartel greenwashing, agency overload, and governments excused from regulating [10]. Veljanovski questions whether restricting competition can deliver environmental gains at all [11]. Loozen argues that relaxing Article 101(3) to enable private collective action undermines consumer sovereignty and democratic legitimacy [12]. The comparativists map the resulting divergence between jurisdictions [13]. None of these camps is arguing about geography. The dispute is whether the exemption should exist, and how the beneficiary class is bounded in market and in time.
Within African scholarship, das Nair and Roberts run a distributive argument, and they run it within the region: who captures value between producers, processors and retailers inside African chains [14]. Neither runs it across jurisdictions. Nobody asks who bears the incidence of a premium authorised in one polity and justified by benefits accruing to another.
Brook's empirical study of some 3,100 cases across the Commission, the EU courts and five member states finds that, since modernisation, Article 101(3) is applied on a very limited basis, and that much of the real balancing happens invisibly through institutional and procedural design rather than through reasoned exemption decisions [15]. If the exemption is close to dormant in the jurisdiction of origin, its export value is largely symbolic. Symbolic transplants are precisely the ones most likely to be applied literally elsewhere. The importing regulator receives the doctrine as text rather than as practice, and has no decisional record telling it how rarely the text is actually used.
The technical debate about the boundaries of the beneficiary class is live and ongoing, addressing the overlap condition between beneficiaries and affected consumers and the weighting of benefits across time horizons [16]. And Nigeria is not the only non-European jurisdiction now facing this question: recent work identifies a dormant green exemption in Chinese competition law and the same sustainability deficit debate arriving there [17]. With Nigeria and China both in frame, what follows describes a pattern rather than a single instance.
Where the Assumption Fails
The assumption inside the out-of-market extension
The CMA's climate carve-out rests on a proposition that is almost never stated, because in its home jurisdiction it is close to trivially true. The UK consumers who pay more for a decarbonised product are, in substantial part, the same population that benefits from decarbonisation. They voted for the climate targets the agreement serves. They have political voice over the pace and cost of the transition. They have the disposable income to absorb the increment. The consumer of sustainability is also, to a significant degree, its political beneficiary. On those facts the out-of-market extension is a technical adjustment rather than a redistribution.
Move the same doctrine to a market for fertiliser in northern Nigeria, or for prepaid electricity in a South African township, and each limb of that proposition weakens simultaneously. The claim therefore is that the doctrine stops being distributively neutral, and that nothing in the drafting requires the regulator to notice.
Ability to pay, and a data point that cuts against the argument
Consultancy research on consumer attitudes reports a stated willingness to pay a premium of roughly 12% for sustainable products, against an average premium actually charged of roughly 28% in the United States [18]. That gap supports the affordability limb directly, and it does so in the same register the ACM used in Chicken of Tomorrow: stated willingness to pay is a measurable quantity, and it can fall short.
The same research contains a finding that cuts against a careless version of this argument. Stated willingness to pay a sustainability premium is higher in several fast-growing markets than in the West. It runs at around 20% in India and 16% in Brazil, against 11% in the United States and 8% - 10% across the United Kingdom, Germany, France and Italy, with roughly 64% of respondents globally reporting high environmental concern. A reader who arrives at that unprepared will read the argument here as asserting African indifference to climate change. It asserts nothing of the kind, and the data says the opposite.
The claim concerns incidence, capacity to pay, and political stake in the specific targets a given agreement is designed to serve. A stated willingness to pay 20% more for a discretionary purchase and an ability to absorb a 28% premium on cooking fuel are entirely different quantities. It is the second, not the first, that the consumer benefit condition is supposed to measure.
The fertiliser case, where the costs turn brown
The strongest available version of this argument is that a green premium in African fertiliser markets may increase emissions.
Two findings produce that result. Agro-dealer-level work on Kenyan fertiliser markets during the fuel-fertiliser-food price crisis documents how global price shocks transmit to the prices smallholders actually face, and finds the transmission asymmetric. Retail prices respond faster to import price increases than to decreases, and transmission is slower in poorer regions [19]. Separate work finds that higher fertiliser prices in Africa drive extensification and forest clearing [20]. When input prices rise, smallholders substitute land for inputs, farming more hectares rather than buying more fertiliser, and new land comes from clearing.
A sustainability agreement among fertiliser suppliers that raises input prices in service of a production-side emissions reduction may therefore increase net emissions through induced land-use change, while transferring the cost to the population least able to bear it. That is a failure on the Commission's own stated terms. Paragraph 16(b)(ii) names agricultural productivity first among the channels through which climate harm reaches all Nigerian consumers. An agreement that drives extensification damages the very metric the Commission relies on to justify the widened class.
A further difficulty in this example which the draft does not address is that Paragraph 74 applies the definition of consumer in section 167 of the Act: a natural person acting for purposes outside his or her trade, business or profession. The Commission spells out the consequence. The relevant consumers are ultimate end-users, not business intermediaries or resellers, and paragraph 75 directs the analysis downstream through the supply chain to final consumers.
A smallholder buying fertiliser is buying for the purposes of a trade. On paragraph 74 that smallholder is not a consumer at all. In the sharpest case, therefore, the population bearing the premium is not merely diluted within a wide national class. It falls outside the class the fair share condition protects, and the analysis is directed instead to retail food prices. Paragraph 76 leaves a hook, acknowledging that intermediaries are economically relevant even though the ultimate test is final-consumer benefit, but the hook is discretionary and the exclusion is the rule.
Note also the jurisdictional detail. A Nigerian fertiliser coordination sits inside ECOWAS jurisdiction as well as national jurisdiction, a point returned to below.
Electricity, and the household that cannot exit
The energy limb should be stated more modestly than the fertiliser one. Peer-reviewed work on household energy poverty in South Africa, based on a case study in Alexandra township, documents how energy access and energy infrastructure shape food access, preparation and storage in low-income households [21]. It evidences the constraint and the inability to exit. It is not a study of transition-driven tariff incidence, and it should not be cited as one.
What it supports is narrower and still sufficient: in these households an increment on an essential utility is absorbed by displacing something else, and that displacement is the mechanism a coordinated green premium would operate through. Direct pass-through evidence in an African electricity market would strengthen this limb, and this brief does not have it.
Enforcement as the counterfactual
The counterfactual to a permissive sustainability defence in African input markets is not regulatory inaction. It is enforcement, and the record shows enforcement working in exactly the market a Nigerian sustainability hypothetical concerns.
In November 2003, Nutri-Flo, a small fertiliser blender and distributor, complained that three large suppliers were colluding, and separately alleged excessive pricing and an effective margin squeeze by Sasol, meaning that Sasol's input prices to Nutri-Flo left no viable margin downstream. The Commission referred Sasol, Omnia and Yara. On 20 May 2009 the Competition Tribunal confirmed a settlement in which Sasol admitted contravention and accepted a penalty of six per cent of Sasol Nitro's turnover, around R188 million, the highest in the Commission's history at that point [22].
It is important to mention that two limits matter for how strongly this is put. First, only Sasol admitted; Yara and Omnia contested. Second, nobody has published a peer-reviewed overcharge estimate, so what survives is that enforcement addressed cartelised pricing in a staple agricultural input, not that it produced a measured price decline against named comparators. The comparative evidence linking higher competition to lower fertiliser prices is global rather than African [23].
What the record does establish is that an African competition authority has already prosecuted conduct in a staple input market, and did so on a small rival's complaint. Enforcement, not exemption, is what has historically protected the buyers of fertiliser on this continent.
Structural mismatch between the paying population and the benefitting population
The mismatch between the population paying the premium and the population receiving the benefit is not simply a Nigerian drafting error. Hence, the question to be asked is, why does a doctrine built for the UK end up in Nigerian guidance, in its widest form, and stay there? Four reasons can be identified namely, capacity constraint, adoption under external pressure, three institutional channels carrying the doctrine, and a regional architecture that would propagate it.
Capacity constraint
Gal's analysis explains why doctrine designed for large, thick markets misfires in small, concentrated ones [24]. This is where the paragraph 19(e) safeguard becomes the pivot. The safeguard says the evidential burden is not reduced. Whether that holds depends on three things: (i) whether the authority has the resources to test the evidence adduced (ii) the economic capacity to run or commission the equivalent of the ACM's conjoint analysis and (iii) the institutional confidence to refuse a well-lawyered application from a multinational applicant invoking a national climate statute. The Dutch regulator had all three in 2015 and used them.
A safeguard that depends on capacity the regulator does not yet have is a safeguard on paper. Whether the FCCPC has that capacity is an open question, and one the Commission is better placed to answer. However, Paragraph 21 is the reason to think the answer will be difficult.
Adoption under external pressure
Waked in his paper shows that developing countries adopted competition law largely because outside actors pressed them to, not because anyone at home was asking for it. The rules they passed were modelled on developed country legislation written for conditions that did not obtain locally [25]. His later work develops the point. Competition regimes in these countries pursue efficiency and consumer welfare while local development needs go unserved, and Waked proposes distributive correctives to close the gap [26]. The argument here applies that critique to climate. Waked has been making it for fifteen years and nothing about the green file changes it.
The corresponding African literature has already rejected the deficit framing. Büthe and Kigwiru document the plurality of statutory objectives across African competition regimes, including small and medium enterprises, disadvantaged groups, employment, development goals and environmental protection [27]. African statutes already name development, employment and environmental protection among the things competition law is for. An Africa-centred sustainability doctrine can therefore be built on what the statutes say, rather than argued for on principle alone.
The channels: technical assistance, standard-setters and business
Three concrete conduits carry the doctrine from Europe to African regulators.
The first is technical assistance. The United Nations Conference on Trade and Development (UNCTAD) has run two decades of donor-funded capacity building on competition law and policy [28]. That programming is now formalised through a memorandum of understanding with the AfCFTA Secretariat, under which UNCTAD co-organised the first regional capacity-building workshop on the Competition Protocol in Libreville in August 2023. The detail that matters is that the European Union's Technical Assistance Facility funded the workshop [29]. EU money paying for AfCFTA competition capacity-building is the cleanest documentary evidence of the channel available.
The second is the standard-setters. The OECD Competition Committee's background note on environmental considerations in competition enforcement, prepared by named Secretariat staff for the Committee's December 2021 session, functions as the transmission belt [30]. Its four-scenario framework distinguishes conduct that is anti-competitive and environmentally harmful, pro-competitive and beneficial, anti-competitive but beneficial, and pro-competitive but harmful. That framework is what agencies outside the European academic literature actually receive, and they receive it as a menu of approaches rather than as a contested debate. Individual advocacy notes submitted to the same Committee are a different kind of document and should not be cited as institutional positions [31].
The third is business. The International Chamber of Commerce's practical guide on competition law and sustainability agreements evidences the multinational harmonisation incentive [32]. A group operating in both regions has institutional and reputational reasons to run one sustainability compliance policy rather than two, and the path of least resistance is to press for the more permissive standard everywhere. The guide covers the EU, UK and US only, so it evidences the incentive existing rather than the incentive reaching African subsidiaries directly.
It is worth citing against interest here too. Advocacy from the Information Technology and Innovation Foundation frames EU standard export as regulatory imperialism and argues that it hinders innovation in the Global South [33].
The regional architecture
The institutional layer moved quickly between 2023 and 2025, and a continental authority would be the most efficient possible vector for a single doctrinal borrowing.
Precision matters here. The AfCFTA Protocol on Competition Policy, adopted at the 36th Ordinary Session of the AU Assembly in February 2023, contemplates a continental competition authority with jurisdiction over conduct of continental dimension. It is not in force. As a Phase II instrument, it requires its own ratification process, and the implementing regulations that would define the relationship between a continental authority and existing regional and national regimes have not been finalised [34]. The institutional design question, including whether such an authority would exercise original or referral jurisdiction, remains open [35].
That is precisely why the timing point bites. When the continental layer writes its first sustainability guidance, it will write it from something. The candidates on the table are the Horizontal Guidelines, the CMA guidance, and the FCCPC draft. Political economy work on why national agencies support supranational regional regimes supplies the mechanism by which a doctrine adopted in one place propagates region-wide [36]. And the regional layer is already live, as the ECOWAS Regional Competition Authority became fully operational on 1 October 2024, and a Nigerian fertiliser coordination sits within its jurisdiction as well as the FCCPC's [37].
African merger control now operates across national, regional economic community (REC) and continental layers with no binding conflict-resolution mechanism [38]. The same architecture produces something more consequential here. Where three layers may each articulate a sustainability standard and none has primacy, the applicant's incentive is to structure the agreement so that it is assessed by whichever authority has drawn its beneficiary class most widely. Forum shopping for the most permissive sustainability standard is a concrete regressive-outcome pathway.
The Practitioners' Problem
For a compliance function or deal team advising a group with both European and African operations, the divergence described above is already operative. Five concrete exposures follow.
- Divergent treatment of a single group-wide initiative. A climate agreement designed to satisfy the CMA's climate change sub-category, assessed against benefits to all UK consumers, does not automatically satisfy Chapter 9 of the Horizontal Guidelines, which requires benefits in the affected market or one substantially overlapping with it. If the FCCPC draft is adopted in its current form, the same initiative will be assessed in Nigeria on a basis closer to the UK's than to the EU's. A single group policy will face three different consumer benefit tests across three jurisdictions, and the analysis cannot be done once and rolled out.
- The evidential burden is the operative constraint, not the beneficiary class. This is the exposure most likely to be misjudged. Paragraph 19(e) preserves the evidential burden expressly, paragraph 14 excludes speculative claims, and paragraph 19(d) requires assessment of less restrictive means including regulatory measures. The practical question for an applicant is what quantified benefit evidence looks like where the affected consumers are smallholders or low-income urban households. Conjoint analysis of stated willingness to pay is the technique that defeated the Dutch applicants in 2015. Run in a market where a substantial share of affected consumers are at or near subsistence, it is likely to produce a lower measured willingness to pay, not a higher one, precisely because the constraint being measured is ability rather than preference. Applicants should not assume that a wider beneficiary class makes the application easier to evidence. In several plausible configurations it makes it harder.
- The section 167 problem in input markets. Where the affected purchasers are businesses rather than natural persons acting outside a trade, they are not consumers for the purposes of the fair share condition, and paragraph 75 directs the assessment downstream to final consumers. An applicant whose agreement raises input prices for farmers or small traders cannot rely on benefits to those purchasers to satisfy the consumer benefit question, and will need to demonstrate pass-through to end-consumers.
- Structuring and forum risk. Where an agreement has a footprint across ECOWAS or COMESA member states as well as a national footprint, the choice of where and whether to seek authorisation is a live structuring question with no binding allocation rule behind it. That is an opportunity in the short term and a risk in the medium term. An authorisation obtained from the authority with the widest beneficiary class is vulnerable to challenge, to inconsistent treatment by a parallel authority, and to reversal if the continental layer settles on a narrower standard.
- Distributive and reputational exposure. African competition statutes carry plural objectives including development and environmental protection, and South Africa's public interest provisions demonstrate what a competition authority does when a transaction's distributive consequences are put in issue [39]. A sustainability agreement whose incidence falls on low-income consumers is exposed not only to a fair share objection but to a public interest objection framed in the statute's own terms.
The practical recommendation is straightforward. Any sustainability agreement intended to operate in an African market should be documented with an explicit incidence analysis. Who bears the premium, in what proportion of household expenditure, and over what period, set against who receives the environmental benefit and when. No guidance currently in force requires that analysis. However, it is the analysis that will determine whether the authorisation survives.
Recommended Amendments to Section 2.1.4 of the Exposure Draft
- An incidence condition on the out-of-market extension. The widened beneficiary class should be available only where the Commission is satisfied that the population bearing the restriction substantially overlaps with the population receiving the environmental benefit. Where it does not, the applicant should be required either to demonstrate compensating benefit to the affected consumers specifically, or to accept conditions redistributing the surplus toward them. This does not disturb the analysis where the two populations coincide, which will be the ordinary case for agreements affecting middle-income urban consumers. It bites only where the divergence is material, which is where the doctrine's silent assumption fails.
- Ability to pay, not merely willingness to pay. Where a material share of affected purchasers are at or near subsistence, stated willingness-to-pay evidence should be treated as necessary but not sufficient. Willingness to pay measures preference under an existing budget constraint, and it systematically understates welfare loss where that constraint binds on essentials. The evidential standard should require the applicant to address the premium as a share of affected household expenditure on the good, and to identify the substitution response.
- Reserve the widest allowance for standardisation and information agreements. The mooted block exemption at paragraph 20 is the most defensible part of the sustainability toolkit, and its EU analogue carries a 20% share threshold that paragraph 20 does not. Standardisation and information-sharing agreements can deliver environmental benefit with limited price effect. Coordination that directly affects price, output or route allocation should not receive the widest beneficiary class. The allowance should be graduated by the directness of the price effect rather than by the environmental character of the objective, and a share limb should be added.
- Treat enforcement as a climate instrument in its own right. The reflex when climate objectives meet competition law is to ask what the law should permit. The opposite question is better evidenced. Work on Article 102 TFEU and sustainability presents evidence that dominant firms are disproportionately engaged in unsustainable practice, and argues that abuse control is an underused instrument against environmental degradation and social injustice [40]. Recent work on enforcement priorities in developing countries argues for concentrating scarce capacity on sectors tied to poverty alleviation and essential services, and for aligning imported sustainability standards with local development needs [41]. On the African side, the fertiliser cartel record is direct evidence of enforcement operating in the relevant input market, and the structural transformation literature gives a positive account of what African competition enforcement is for, against which a green premium can be scored rather than assumed [42].
Paragraph 19(d) already requires the Commission to consider whether the same environmental outcome could be achieved through less restrictive means, and expressly lists regulatory measures among them. An authority with limited capacity choosing between building an authorisation function for green agreements and building an enforcement function against dominant polluters is not choosing between climate action and inaction. It may be choosing between two climate instruments, of which the second is both better evidenced and distributively safer.
The Possible Objection to These Amendments
The most serious objection is whether a competition authority has any business making distributional judgments at all [43]. An incidence condition as stipulated in the first recommendation asks the Commission to do precisely that.
However, the following responses are available to the objection. First, the authority is already making a distributional judgment. Choosing an aggregated national beneficiary class over an in-market one is a distributive choice with identifiable winners and losers. It is simply a choice made silently. Requiring the incidence to be stated makes the judgment reviewable rather than creating it.
Second, the statutory hooks exist. Section 1(e) of the FCCPA states an objective of contributing to the sustainable development of the Nigerian economy, and African competition statutes more generally carry plural objectives including development and environmental protection. The legitimacy objection has more force against an EU authority operating under a narrower mandate than against a Nigerian one operating under a broader one.
Third, and least comfortably, the South African experience shows both that a competition authority can carry distributive objectives and that doing so produces inconsistent application and contested ministerial discretion. Recent work argues that South African competition law has rhetorically endorsed the public interest without developing a coherent evaluative framework, leaving application exposed to ministerial discretion and conceptual vagueness [44]. That is the implementation risk this proposal inherits, and it should be conceded rather than argued away. The answer is to specify the incidence condition tightly enough that it functions as a test rather than as a discretion, which is why the proposals above are framed at drafting level.
Conclusion
Return to the cooking gas distributors, and to the single fact that was varied. The Commission's own example at paragraph 21 holds that competition on price is preserved. Assume it is not, in the next application or the one after that, and the arrangement remains authorisable on the basis that the climate benefit accrues to Nigerian consumers as a whole.
The households paying more for cooking fuel are inside that class in the sense that they are Nigerian. They are outside it in every sense that matters to the consumer benefit condition. They bear a measurable premium on an essential good. They receive a diffuse and delayed benefit shared with two hundred million others. They had no part in setting the target the agreement serves. In the fertiliser variant they are not inside the class at all, because section 167 does not treat them as consumers.
This is a feature of the doctrine as built in London, where the same analysis produces an unobjectionable result because the paying and benefiting populations substantially coincide. The transplant is faithful. The context is not.
The consultation has closed and no final instrument has issued, which means the question is still open but no longer open indefinitely. The safeguards at paragraphs 14, 17, 19(d) and 19(e) show that the drafters are alive to the risk of a defence that does too much work, and paragraph 21 shows how quickly the widened class is set aside when an example has to be resolved. What the draft does not yet contain is any requirement that the Commission ask who pays.
That requirement is one condition, and it can be written into Regulation 3(3) or into section 2.1.4 itself. Adding it now, while the responses sit with the Commission and no final instrument has issued, is a drafting exercise. Adding it later, after a continental authority has written its own guidance on the same model, will be considerably harder.