Tick-tock: MTN told to pay fine before 2016

2015-12-31 07:11
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A customer selects an MTN prepaid mobile phone SIM card at a roadside kiosk in Lagos, Nigeria. MTN, Africa's largest wireless operator, remains in negotiations with the Nigerian regulator over a $5.2?billion fine meted out for failing to comply with

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Lagos - Nigeria’s communications regulator said MTN [JSE:MTN] must stick to a December 31 deadline to pay a record $3.9bn (R60bn) fine, even after Africa’s largest phone company prepares to try and overturn the penalty in court.

“The deadline remains,” Tony Ojobo, a spokesperson for the Nigerian Communications Commission (NCC), told Bloomberg on Wednesday.

The NCC will consult with lawyers about what to do if the Johannesburg-based company doesn’t pay the fine on Thursday, he said, without providing detail on possible actions the regulator may take.

MTN is challenging the penalty in the Federal High Court in Lagos, the country’s commercial capital, after it said earlier this month the NCC didn’t have the power to impose the fine.

The regulator took action after MTN failed to meet a deadline to disconnect 5.1 million unregistered subscribers as security agencies seek to fight crime and Islamist militants in a country with poor identity records.

The regulator “will allow” the courts to do their work and the NCC is planning to challenge the MTN dispute filed in Lagos, Ojobo said.

MTN spokesperson Chris Maroleng declined to comment beyond a December 17 statement announcing the decision to go to court.

The company’s shares have declined 27% since the fine was made public on October 26, valuing the wireless operator at R256bn.

While MTN chairperson Phuthuma Nhleko has been leading negotiations with the Nigerian authorities after CEO Sifiso Dabengwa resigned, Ojobo said he wasn’t aware of any talks currently being held between MTN and the West African nation’s regulator and government.

The question is whether the NCC will be overruled by the lenient telecommunications ministry in Nigeria.

On December 24, Fin24 published a Reuters story that revealed that Nigerian authorities will wait for the outcome of the court challenge before deciding on whether to the fine.

"The federal government, NCC (regulator) or any government agent will not do anything at the expiration of the December 31 deadline," said Victor Oluwadamilare, the telecommunications ministry's media assistant.

"Now that they (MTN) have gone to court we will await the outcome of the case," he added. "This is a government that believes in the rule of law."

The ministry appears to have taken a softer stance than the regulator on the dispute. The minister Adebayo Shittu told Reuters last month the West African nation did not want MTN to "to die" from the fine.

The move against MTN came months after Muhammadu Buhari became president of Africa's biggest economy, promising tougher regulation and a fight against corruption.

Other telecoms firms operating in Nigeria disconnected unregistered users within the deadlines set by the authorities.

- With additional reporting from Reuters.

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