Nigeria's telecommunications sector is facing tighter regulatory scrutiny after the Nigerian Communications Commission (NCC) and the Corporate Affairs Commission (CAC) introduced new approval requirements for significant changes in the ownership structures of licensed operators.

Under the new rules, already in effect, any transfer of ownership or control involving 10% or more of a communications licensee's share capital will require a Letter of No Objection from the NCC before the transaction can be registered with the CAC. The requirement also applies to a series of smaller transactions that collectively exceed the 10% threshold.

Regulators are seeking greater visibility over ownership changes that they argue could negatively affect competition and investor confidence. The commissions said the measure is anchored in Section 90 of the Nigerian Communications Act 2003, Regulation 28(2) of the Competition Practices Regulations 2007 and Regulation 42 of the Licensing Regulations 2019, which empower the NCC to review transactions affecting licensees and safeguard competition in the sector.

Under the arrangement, the CAC will require proof of prior NCC approval before registering changes in shareholding structures involving 10% or more of a licensee's equity. In a joint statement, the commissions said the new framework was designed to prevent direct and indirect anti-competitive practices, enhance transparency and strengthen regulatory oversight of significant ownership changes.

Nigeria hosts Africa's largest telecoms market. Active mobile subscriptions rose by 15.1mn year on year, or 8.7%, to 188.0mn in April 2026 from 172.9mn a year earlier, according to NCC data. On a month-on-month basis, subscriptions increased by 2.3mn, or 1.2%, from 185.7mn in March, underscoring continued momentum in subscriber growth.

Broadband penetration exceeded 48%, reflecting rapidly expanding demand for data services. Major operators include MTN Nigeria Communications (NGX: MTNN), Airtel Africa (LSE: AAF; NGX: AIRTELAFRI), Globacom and 9mobile. The sector contributed about 14%-15% of GDP in recent quarters and has become one of the country's largest recipients of private investment.

MTN Nigeria Communications remains the market leader, accounting for roughly 51% of mobile subscriptions, followed by Airtel Africa with around 34%, according to NCC data. Globacom controls about 12% of the market, while 9mobile's share has fallen to below 3% after years of subscriber losses. Although subscriber shares fluctuate, analysts estimate that MTN Nigeria and Airtel Africa together account for more than 85% of industry revenues, reflecting increasing market concentration as smaller rivals struggle to keep pace with network investments and rising operating costs.

“The sustained growth in mobile subscriptions is largely attributable to the easing of key regulatory and operational challenges that previously constrained industry expansion. Notably, improved compliance with SIM registration and National Identification Number (NIN) linkage requirements has facilitated the reactivation of previously deactivated SIM cards, contributing significantly to the increase in active subscriptions,” CSL Stockbrokers Limited, Lagos (CSLS) said in a note to clients on June 23.

“Operator performance remained broadly positive during the review period, underscoring the sector’s ongoing recovery. MTN Nigeria maintained its market leadership position, recording a net subscriber addition of 632,209 to reach 96.4mn subscribers in April 2026, up from 95.8mn in March. Airtel Nigeria delivered the strongest growth among the major operators, adding approximately 1mn subscribers to increase its customer base to 64.7mn … Globacom also sustained its recovery momentum, with its subscriber base expanding by 538,704 to 23.2mn. Meanwhile, 9mobile (T2) recorded modest growth, increasing its subscriber base to 3.54mn from 3.48mn,” the brokerage added.

5G and data centre infrastructure, fintech investment fuel expansion

The tighter ownership rules come amid rising consolidation and infrastructure investment across Africa's telecoms sector. Operators have increasingly pursued tower-sharing agreements, fibre investments and digital financial services in search of new growth opportunities.

Nigeria's telecom infrastructure ecosystem includes tower operators such as IHS Holding (NYSE: IHS), American Tower Corporation (NYSE: AMT) and privately held Pan-African Towers, all of which have benefited from increased network investment and infrastructure-sharing arrangements.

The industry continues to attract substantial investment in broadband infrastructure, fibre networks, data centres and digital services. Nigeria has licensed 5G spectrum to MTN Nigeria and Mafab Communications, while Airtel Africa has expanded 5G services across major urban centres. Rising data consumption has shifted competition away from traditional voice services towards broadband and digital ecosystems.

The sector is also seeing growing investment in fibre infrastructure and data centres as operators seek to meet rising demand for cloud computing, streaming services and artificial intelligence applications. MainOne, Open Access Data Centres and Rack Centre have expanded capacity in recent years, reinforcing Nigeria's position as West Africa's digital hub.

Telecom operators are increasingly looking beyond connectivity to digital financial services. MTN Nigeria's MoMo platform and Airtel Money are viewed as important long-term growth drivers, adding another layer of strategic significance to ownership structures and market concentration.

The telecoms sector recently secured regulatory approval for tariff increases aimed at offsetting rising energy and operating costs and supporting continued network investment. However, analysts expect larger operators with stronger balance sheets to benefit disproportionately.

A recent Analysis Mason report noted that scale and infrastructure investment are becoming increasingly important competitive advantages across Sub-Saharan Africa's telecom sector. The consultancy expects operators to focus on network quality, fibre assets and digital services as traditional voice revenues mature.

PwC argues that telecoms are entering a new infrastructure cycle driven by artificial intelligence, data centres and rising traffic growth. It says operators are simplifying business models and seeking new revenue streams while infrastructure ownership becomes increasingly strategic.

Meanwhile, the Association of Licensed Telecommunications Operators of Nigeria (ALTON) recently questioned official figures showing a sharp decline in foreign capital inflows, arguing that the statistics understate actual investment activity and highlighting the sector's sensitivity to financing conditions.

Nigeria’s stricter regulatory approach follows a continental trend

The new approval framework brings Nigeria closer to regulatory practices adopted elsewhere in Africa, where telecommunications authorities are increasingly scrutinising changes in ownership and market concentration.

South Africa's Independent Communications Authority (ICASA) has closely reviewed spectrum allocations and major transactions involving MTN Group (JSE: MTN), Vodacom Group (JSE: VOD) and Telkom SA (JSE: TKG), while Kenya's Communications Authority has taken a more active role in overseeing competition issues involving Safaricom (NSE: SCOM), Airtel Kenya and infrastructure-sharing arrangements.

In Ethiopia, the entry of Safaricom Ethiopia and the partial liberalisation of the market have been accompanied by extensive regulatory oversight, while Egypt's National Telecom Regulatory Authority has maintained strict controls over ownership changes and licensing conditions. Similar competition reviews have accompanied mergers and spectrum allocations in Morocco and Tanzania.

The NCC and CAC said they would continue to cooperate closely to ensure fair market practices and support the orderly development of Nigeria's communications industry as the country pursues broader digital economy ambitions.