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Federal High Court Strikes Down NBC’s 2.5% Gross Income Levy on MultiChoice
Justice James Omotosho of the Federal High Court Abuja has struck down Section 2 (10) (b) of the National Broadcasting Code, 6th Edition, which required broadcasters to pay 2.5% of their “Gross Annual Income” as an Annual Operating Levy.
This judgement followed a suit filed by MultiChoice Nigeria Ltd and Details Nigeria Limited (GO TV) against the National Broadcasting Commission (NBC).
Delivering judgement on Wednesday, Justice Omotosho, ordered that the provision be struck down and replaced with ‘Net Annual Income’ instead of the existing ‘Gross Annual Income.’
The court also barred the National Broadcasting Commission (NBC) from demanding the plaintiffs’ VAT remittance, FIRS reports, bank statements, audit adjustment journals, trial balances, and general ledgers for the purpose of computing the plaintiffs’ annual income, other than the annual audited accounts of the companies as stipulated in the NBC Code.
The judge stated that the NBC can only access the other financial documents of MultiChoice through sister agencies such as the Federal Inland Revenue Service (FIRS).
In the suit, the plaintiffs’ counsel, Moyosore Onigbanjo, SAN, sought several reliefs, including a determination of whether the NBC had the authority to demand any financial documents other than the annual audited accounts.
He also sought clarification on whether the term “gross annual income,” as used in the NBC Code, was fair and equitable.
“Income, as provided by the NBC Code 6th Edition, is not defined, nor is it defined in any previous editions or in the NBC Act of 2004,” the counsel submitted in court.
Onigbanjo also asked the court to determine whether the waiver or agreement between the plaintiffs and the NBC to pay a flat rate of N800,000,000 (Eight Hundred Million Naira) as Annual Operating Levy for the years 2020–2023, including certain previous years, was binding on both parties.
Counsel to the NBC, Victor Ogude SAN, argued before the court that the agreement was not binding on the NBC, as the NBC’s acting Director-General who entered into the agreement on its behalf acted beyond his powers.
He contended that the NBC was entitled to the full amount payable.
Ogude also urged the court to uphold the NBC’s oversight role over MultiChoice and Details Nigeria.
Delivering his verdict on Wednesday, Justice Omotosho, said with his experience as a trained economics teacher, running a business like the one operated by the plaintiffs requires significant capital and expenses. It is only fair, he said, that these expenses be deducted before the Annual Operating Levy is paid.
He stated that net income is the actual profit after subtracting all business expenses, adding that the taxable amount cannot be determined when calculating gross profit but should be based on net profit.
The judge emphasized that the Annual Operating Levy charged by the NBC is a form of tax imposed on broadcasters.
He held that it would be unjust to impose it on their gross income.
“The proper and lawful income to impose a levy on is the net income,” he said, adding that this aligns with tax laws and global best practices. “In the United States, for instance, companies pay a flat rate of 21% on their profits, determined after all expenses have been deducted. Similarly, in the United Kingdom, a 25% corporation tax is imposed on company profits.”
“From this Court’s knowledge of economics, gross income implies all money that accrues to a person or business within a specific time. This gross income typically does not account for company expenditures such as production costs, rent, vendor payments, staff salaries, taxes, and other costs. It is only after all these payments are made that the company determines its profit, known as net income.”
“Consequently, this Court holds that Section 2 (10) (b) of the National Broadcasting Code, 6th Edition, which demands 2.5% of Gross Annual Income from broadcasters as an Annual Operating Levy, is unconscionable, unfair, and stifling to the plaintiffs,” Omotosho ruled.
Furthermore, Omotosho noted that the plaintiffs had provided credible and documentary evidence showing they had faithfully paid their Annual Operating Levy (AOL) without fail, and the defendant did not challenge these documents.
He said the NBC’s claim that it was entitled to N4 billion, as stated in its letter dated August 15, 2023, was unsupported by any evidence.
“Simply basing its claim on the fact that the plaintiffs increased their subscription fees is grossly insufficient. First, there is no evidence before the court that subscription fees were increased. Second, the defendant failed to consider that the plaintiffs may have increased their production costs or incurred additional expenses. This Court refrains from speculation as the defendant has invited it to do,” Omotosho added.
Regarding the agreement, Omotosho ruled that when parties express their intention and enter into a binding agreement, neither party is allowed to abandon the agreement simply because one or more of its terms are unfavorable.
The judge declared that the agreement between the defendant and MultiChoice, or the waiver on the payment of N800,000,000 (Eight Hundred Million Naira) throughout their current “DTH license”, is binding on both parties.
He also restrained the NBC from demanding any additional sum from the plaintiffs as AOL for the years in which they have already made payments.
He issued a perpetual injunction restraining the NBC, its servants, agents, or privies from sanctioning, fining, or suspending the plaintiffs’ license, contrary to the court’s judgment on the issues raised.
A digital rights advocacy organisation, Paradigm Initiative has taken legal action against the National Identity Management Commission (NIMC), Central Bank of Nigeria (CBN) and other government agencies, alleging systemic violations of citizens’ digital rights, including failures in data protection and inclusivity.
This is even as it revealed the scale of an alleged data breach affecting 43 million Nigerians.
Gbenga Sesan, executive director, Paradigm Initiative, at the end of year media briefing, on Wednesday, in Lagos, said Paradigm Initiative is taking this step, following allegations that surfaced in April 2024 about hackers gaining unauthorised access to national databases, claiming that personal data—including National Identity Numbers (NINs), home addresses, phone numbers, and passport details—was illegally accessed and sold.
According to Sesan, this breach potentially affects up to 43 million Nigerians. “When the data of ordinary Nigerians is breached, nobody does anything. To draw attention to the issue, Paradigm Initiative purchased the personal data of senior government officials, including the Minister of Communications and Digital Economy, and used it as evidence to push for legal action,” he stated.
“To this end, Paradigm Initiative has filed a lawsuit against NIMC and several other agencies, including the Central Bank of Nigeria, Nigeria Immigration Service, and the Federal Inland Revenue Service, accusing them of failing to protect citizens’ data.
“The case, filed in the Abuja Judicial Division in October 2024, aims to establish three key objectives: Prove that a data leak occurred; Invoke the powers of the Nigeria Data Protection Act and ensure accountability and sanctions for responsible parties. January 2025 has been scheduled for hearing,” Sesan revealed.
Sesan highlighted the government’s alleged negligence, particularly NIMC’s repeated denial of any breach.
“They called me a liar on national TV,” Sesan remarked. “But if data wasn’t leaked, why did the Minister call for an investigation? Why did the Data Protection Commission acknowledge a fine? These contradictions need answers.”
He also criticized the lack of independence and funding for the Nigeria Data Protection Commission (NDPC). “In 2024, the NDPC operated with a budget of zero Naira,” Sesan revealed, underscoring systemic issues in the enforcement of data protection laws.
The data breach has broader implications for national security, as it raises questions about the reliability of government systems meant to protect sensitive information. Sesan expressed concern about the use of third-party vendors in managing national data, emphasizing the need for stricter oversight.
“The government forced Nigerians to stand in queues during the COVID-19 pandemic to register for NINs, promising that it would enhance security,” Sesan said. “Now, the same data meant to protect us is being mishandled and sold. This negligence is unacceptable.”
The lawsuit seeks to address these issues comprehensively, calling for greater accountability from agencies entrusted with citizens’ data, said Sesan, challenging the government to clarify discrepancies in its handling of the breach and ensure that ordinary Nigerians are not left vulnerable to exploitation.
“The court proceedings could set a landmark precedent for data protection in Nigeria, I urge citizens to demand greater transparency and accountability from those in power. This fight isn’t just about senior officials. It’s about protecting every Nigeria’s fundamental right to privacy,” he added.
In her opening remarks, the chief operating officer, Paradigm Initiative, Nnena Paul-Ugochukwu, said: “Africa is at the forefront of a global digital revolution, bringing unprecedented opportunities in education, health, business, and governance.
However, Ugochukwu highlighted significant challenges, including the widening digital gap, data privacy violations, censorship, and poor digital governance. While technology has enhanced our lives, these challenges hinder economic growth, social progress, and the fundamental rights of citizens,”
The COO also pointed to the disturbing trends of internet shutdowns, digital surveillance, and algorithmic biases, which threaten freedom of expression and disproportionately affect underserved communities.
To tackle these issues, she said, Paradigm Initiative, a pan-African nonprofit, has been at the forefront of promoting internet freedom and digital inclusion for over 15 years. “With a presence in six African countries and programs spanning 27 nations, Paradigm Initiative has directly impacted more than 150,350 underserved African youth, providing digital opportunities and protecting online rights,” she added.
Ecobank Nigeria has issued a notice to customers regarding fluctuations in its interbank funds transfer service, which may result in delayed transactions.
The bank reassured its customers that efforts are underway to resolve the issue and that all affected transactions will be processed as soon as the service is restored.
In a statement, Ecobank acknowledged the inconvenience caused and emphasized its commitment to minimising disruptions.
“We are working diligently to resolve this issue and ensure normal service delivery,” the statement read.
The bank also noted that other electronic banking services remain fully accessible, allowing customers to continue enjoying a seamless banking experience.
To assist customers during this period, Ecobank encouraged the use of its live chat feature on ecobank.com and provided an email address, [email protected].
The bank reiterated its dedication to providing reliable financial services across its platform, thanking customers for their understanding and patience.
As Africa’s leading Pan-African bank, Ecobank assured customers of its commitment to addressing their concerns promptly while delivering innovative and customer-centric solutions. The bank concluded with an appeal for continued trust as it works to resolve the current challenges.
Galaxy Backbone Limited, Nigeria’s premier Information and Communication Technology (ICT) service provider, had the distinct honor of hosting the Executive Governor of Plateau State, His Excellency, Barrister Caleb Manasseh Mutfwang, at its corporate headquarters in Abuja. The visit highlighted Plateau State’s growing commitment to harnessing digital infrastructure to enhance governance and accelerate economic development.
Governor Mutfwang, accompanied by a distinguished delegation, toured Galaxy Backbone’s state-of-the-art facilities, including its Tier III data center, its Security Operations Centre and Network Operations Centre. The visit provided a platform for robust discussions on leveraging ICT for improved transparency, accountability, and efficiency in governance.
Welcoming the Governor, the Managing Director and CEO of Galaxy Backbone, Professor Ibrahim Adeyanju, commended his visionary leadership and dedication to digital transformation.
“Your visit is a testament to Plateau State’s commitment to embracing innovation as a catalyst for development,” Professor Adeyanju stated. He further emphasized Galaxy Backbone’s unwavering dedication to providing the digital infrastructure and expertise required to turn this vision into reality.
During the meeting, the Galaxy Backbone team outlined the immense opportunities that Plateau State could unlock through its partnership with the ICT giant.
These included access to Uptime-certified data centers for secure and uninterrupted operations, robust digital security measures through the Security Operations and Network Operations Centers, and cost-effective solutions designed to localize data sovereignty while optimizing payment structures. Additionally, the discussion explored how managed cloud services, tailored to Plateau State’s unique needs, could scale e-governance initiatives and drive efficiencies.
The visit also focused on empowering the state’s workforce through capacity-building initiatives. Galaxy Backbone is committed to designing training programs that would not only enhance digital literacy but also foster an ecosystem of innovation to create job opportunities for the youth.
The potential of the 1Government Cloud platform was also discussed, highlighting its ability to streamline and automate government services while promoting transparency and accountability. Furthermore, Geographic Information Systems (GIS) were positioned as tools for informed decision-making, offering solutions in areas such as land registration and resource management.
Governor Mutfwang expressed his administration’s dedication to transforming Plateau State into a leading digital hub, noting the state’s unique positioning as a vibrant ICT community outside Lagos. He underscored the importance of empowering the youth to participate in the global digital economy while residing in Plateau. “This is the future, and Galaxy Backbone is pivotal to making this vision a reality,” he remarked.
He also referenced complementary projects, such as the ongoing upgrade of the Yakubu Gowon Airport into a cargo hub and the African Development Bank’s selection of Plateau State as a Special Agro-Industrial Processing Zone, as initiatives poised to boost the state’s economic potential.
Barr. Mutfwang also described GBB as a national asset with immense potential to foster good governance and stimulate economic growth. He commended the company for its role in promoting digital inclusivity and emphasized his administration’s determination to spearhead a digital revolution in Plateau State.
The visit earlier commenced with an extensive tour of Galaxy Backbone’s cutting-edge facilities, reinforcing the company’s readiness to support Plateau State’s aspirations. Professor Adeyanju reiterated the company’s commitment to translating the interactive deliberations into actionable solutions, stating, “This engagement marks a significant milestone in our journey to redefine governance and foster innovation.
“We are honored to host Your Excellency and look forward to working closely with your administration to achieve a digitally inclusive and economically prosperous Plateau State.”
The collaboration between Galaxy Backbone and Plateau State signals a bold step toward a groundbreaking digital transformation, setting a precedent for ICT-driven development not only in the state but across Nigeria.
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