The licensing framework around a new licence category in the Nigerian telecom sector

The licensing framework around a new licence category in the Nigerian telecom sector

The Commission developing Application-to-Person (A2P) Service Messaging Licensing Framework has highlighted its benefits to Nigerians, the telecom industry and the entire socio-economic system in Nigeria.

The Executive Vice Chairman (EVC)/CEO, Nigerian Communications Commission, Dr. Aminu Maida  made this known at the Virtual Stakeholders’ Forum on the Draft A2P Licensing Framework held on December 20th, 2024.

 The Ag. Head, Legal & Regulatory Services of NCC, Mrs. Chizua Whyte in her speech added that telecommunications ecosystem  affects businesses, consumers, and service providers alike.

According to her  "A2P  project messaging plays a vital role in today’s digital world. It has become the go-to platform for businesses to send notifications, whether transactional, promotional, or service-related, directly to consumers. From bank alerts and healthcare reminders to promotional campaigns and government updates, A2P messaging drives efficiency, enhances communication, and supports our socio-economic development,

At the Nigerian Communications Commission, our strategic focus is centred on three key stakeholders: the government, consumers, and the industry—our licensees. Each of these stakeholders plays a vital role in the success of the A2P messaging platform".

She said for the government, A2P messaging is a powerful tool for communication with citizens, enabling the efficient delivery of public services and information  saying for consumers, it guarantees timely, secure, and reliable access to essential updates and services.

Chizua explained that the industry, it creates opportunities for businesses and service providers to innovate, drive competition, and achieve sustainable growth adding that despite its undeniable value, the international A2P messaging space in Nigeria faces significant challenges, including consumer protection, fraud prevention, and ensuring industry fairness.

"These gaps have led to issues such as fraud, spam, data privacy concerns, and an unequal distribution of value across the ecosystem. Such challenges not only affect businesses and consumers but also pose a threat to the sustainable growth and potential of this crucial communication tool,

This forum marks a pivotal step toward addressing these challenges. Today we will be presenting the proposed regulatory framework for A2P messaging to you, our valued stakeholders, for deliberation. This framework represents our commitment to fostering innovation while ensuring that all players in the value chain operate in a fair, transparent, and secure environment,

At the NCC, we firmly believe that effective regulation stems from inclusivity and collaboration. This forum is an opportunity for all of us—operators, aggregators, businesses, service providers, and consumers—to engage in meaningful discussions. We want to hear from you—your perspectives, experiences, and recommendations—so that together, we can refine this framework to ensure it meets the needs of all of us, she explained.

She added that Our goal is to create a sustainable and thriving A2P messaging ecosystem that protects consumers promoting fair competition, and unlocks new opportunities for growth. To achieve this, your active participation today is essential. I urge you to engage constructively, provide feedback, and contribute ideas that will help shape the future of A2P messaging in Nigeria.

She  assured you that the Nigerian Communications Commission remains committed to providing a regulatory environment that supports innovation, protects stakeholders, and ensures that our telecommunications sector continues to thrive.

Referencing to others  Salient Highlights from the Virtual highlighted :

1.      The Commission presented the various feedbacks received as inputs into the A2P Licensing Framework being proposed by the Commission and gave NCC’s responses to each or the observations and recommendations made by the licensees.

 

2.      Aside the Virtual Stakeholders’ Forum, held today, which the Commission says it is just the beginning a process, the NCC says it will continue to engage internal and external stakeholders ahead of the Final Draft of the A2P Messaging Services Licensing Framework in line with its participatory rule making process.

 

3.      There was a presentation by an Assistant Director at the Licensing and Authorisation Department of the NCC, Mrs. Truddy Tony-Awusaku, which provides an Overview of Framework for International A2P Messaging in Nigeria (the PowerPoint Presentation (PPT) has been copied and pasted below for you in plain Word text for ease of access. See BELOW)

NOTE

 

Current Status of International A2P Messaging

Justification for Licensing

Objectives

Scope of License

Key Licensing Features

Technical & Security Requirements

Regulatory Compliance

Benefits of the License

Conclusion

INTRODUCTION

u  What is Application-to-Person (A2P) Messaging?

u  Application-to-Person (A2P) messaging is a communication format in the telecommunications sector used to send Short Message Services (SMS) or sending notifications from an application directly to a recipient’s mobile phone.

u  Initiated through the Internet but recipients receive messages via Cellular Connection

u  In other words, A2P

u  Enables businesses to send SMS directly to recipients via mobile networks.

u  Common uses: marketing, notifications, alerts, transactional messages.

CURRENT STATUS OF INTERNATIONAL A2P MESSAGING IN NIGERIA

u  Lack of Regulation: No unified oversight.

u  Revenue Leakage: Payments often bypass local systems, not taxed, reducing economic benefits.

u  Security Risks: Increased spam, fraud, and illegal activities.

u  Market Disparities: Unregulated termination rates lead to inconsistencies.

JUSTIFICATION FOR LICENCING

u  Why Regulatory Oversight is Essential:

u   Standardized Tariffs and Fair competition.

u   Enhanced security against Spam and Fraud.

u  Fraud Prevention and Unwanted Traffic

u   Increased local revenue through Taxation and Levies.

u   Comprehensive Market Oversight.

LICENSING OBJECTIVES

u  Key Goals:

u  Centralize International A2P message Routing

u  Mandate compliance with a unified platform.

u  Protect user data with stringent security protocols.

u  Foster a competitive and transparent market.

LICENCE OVERVIEW

u  Scope of Licence:

u  Operate a centralized International A2P platform.

u  Route A2P messages securely.

u  Offer transactional and notification services.

u  Implement Subscriber opt in/out mechanisms

LIMITATIONS

u  Prohibited from providing Services not included in the Scope

u  No provision of non-licensed telecom services.

u  Prohibition against unauthorized activities.

u  Does not qualify for International Signaling Point Code(ISPC) and National Numbering Plan

KEY LICENSING FEATURES

u  License Fee: N10,000,000 Naira.

u  Tenure: 5 years (renewable).

u  Market: Open to competition with provisions for fair practices.

ELIGIBILITY CRITERIA

u  Registered Corporate Body in Nigeria

u  Have a Contract Agreement with a Host Network Operator or National Carrier

u  Proof of Financial Capabilities for CAPEX/OPEX

u  Any other as may be Required

TECHNICAL AND SECURITY REQUIREMENTS

u  Technical Needs:

u  Capacity to Integrate with local MNOs.

u  Capacity to route A2P Messages through Centralized SMS firewall.

u  Systems for Fraud detection, Data Protection & Encryption.

u  Security Measures:

u  Encryption protocols.

u  Data protection compliance.

u  Spam and fraud filtering.

INTERCONNECTION/INTEGRATION

u  A2P Provider must interconnect with licensees who provide voice and SMS services pursuant to an Interconnect Agreement duly approved and filed by the Commission.

u  All local MNOs and international A2P messaging service providers must integrate their systems with the centralized A2P platform within a specified period

REGULATORY COMPLIANCE

u  Adherence to all relevant NCC Regulations

u  Compliance to Nigerian Data Protection Regulation

u  Submission of periodic reports (Traffic data, Revenue, and Service quality metrics).

u  Compliance with standardized tariffs and licensing conditions.

BREACH OF LICENCE CONDITIONS

u  Sanctions, including fines, suspension, or revocation of the licence.

u  Non-compliance with Tariff regulations, failure to meet security standards, or tax evasion will attract penalties as stipulated by the NCC.

BENEFITS OF LICENCE

u  Improved Security: Safeguard against spam and fraud.

u  Revenue Retention: Local economic growth through taxation.

u  Market Oversight: Transparency in operations and tariffs.

u  Enhanced User Trust: Protection of subscriber data.

CONCLUSION

u  Towards a Secure and Regulated Ecosystem:

u  The International A2P Messaging Licence ensures fair, secure, and efficient communication.

u  Fosters economic growth while protecting consumers and businesses.

u  Encourages a competitive and transparent telecommunications market.