MTN: Still no reprieve with 24hrs to deadline

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With 24 hours to the deadline issued telecoms giant, MTN Nigeria, to pay the N1.04trillion ($5.2 billion) fine imposed by the Nigerian COMMUNICATIONS Commission (NCC), there is  no reprieve from the Federal Government and NCC neither is there any indication that MTN can pay.

NCC had imposed the fine on MTN  for flouting directive relating to the timing of disconnection of 5.1 million unregistered subscribers on its network, which was based on a charge of N200,000 for each unregistered customer not disconnected from its network.
The telecoms firm was given a November 16 deadline to pay the fine.

The company had sent its top executives to Abuja to try to negotiate a way out. Though there had been discussions between the MTN Group and government officials, there are no indications that those talks have yielded fruits, thus putting the telecoms firm’s licence in risk of revocation and its assets in danger of forfeiture as the deadline expires tomorrow.

Neither officials of the telecoms firm nor those of the regulatory body were willing to comment on the issue at the weekend.
Information gathered revealed that MTN was still making spirited efforts to get the issue resolved before the deadline.

The company had earlier written a letter to Nigerian authorities asking for leniency.

Penultimate week, the MTN Group Ltd in South Africa was reported to be making some moves to reduce the amount by as much as 80 per cent and was also considering borrowing money from banks to help settle the penalty, should its request for fine reduction sail through.

The Head of Research of Renaissance Capital (RenCap), Mr. Adesoji Solanke, had shared a note with clients where he said, “MTN is pushing to reduce the fine by 60 per cent to 80 per cent.”  A second lender was also quoted to have said that “MTN is considering borrowing from banks as it recently checked what the banks’ lending capacity to it is.”

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There are however no indications at the weekend that the request had been granted by authorities nor are there indications that MTN has been able to mobilise funds to pay the fine, even though there were reports that it was being advised by some unidentified banks.

While the telecoms firm is pushing for a review and possible pardon, opinions in government are that  not enforcing the administrative sanction may set a bad precedent that could make enforcement of regulation and imposition of sanction to be difficult as defaulters would always seek a review of penalties imposed  or even call for full pardon.

Director, Public Relations at NCC, Mr. Tony Ojobo, had told THISDAY last week that the whole issue bordered on respect for rule of law.
“The issue whether MTN will be able to pay the N1.04 trillion fine is a matter of policy and regulation. The issue of the fine is not about money, but about respect for the rule of law. There is a lesson to be learnt by all from all of these, and the lesson is that where there is rule of law, there is need to obey the rules because it guides the regulator from acting arbitrarily and also guides the operators to conform to existing laws. When this is done, it will boost investor confidence in doing business in a country where there are laws and provisions for implementation of the laws,” Ojobo had said.

The Minister of Communications, Adebayo Shittu, who was sworn-in last Wednesday, had on Friday in an interview with Reuters on the progress of the talks, said there was “nothing before me,” adding, “If any new thing would happen, there must be initiative from concerned quarters. It is up to MTN.”

“A judgment has been given, as it were, and the period for enforcement has not yet passed,” Shittu, was quoted in the interview.
He however added that,”Nobody wants MTN to die. Nobody wants MTN to shut down.”

Since the announcement of the fine, MTN’s shares have lost nearly 25 per cent of their value. The $5.2 billion fine also led to the resignation of the Chief Executive Officer of MTN Group, Mr. Sifiso Dabengwa.

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