MTN given 18 days to pay $5,2bn fine - TechCentral

MTN given 18 days to pay $5,2bn fine

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The Nigerian Communications Commission (NCC) shows no sign of backing down over a record-setting US$5,2bn (R72bn) fine against the local subsidiary of South African-headquartered mobile phone group MTN.

According to a report by the news wire service AFP, the commission has given MTN until 16 November — just 18 days from now — to cough up the punitive amount, or face the consequences.

MTN is facing the NCC’s wrath for failing to disconnect 5,1m unregistered Sim cards from its network by an 11 August deadline. The commission has imposed a fine of 200 000 naira (or about R14 000) on each unregistered Sim that was not disconnected in time.

The tough sanctions are permitted under the country’s Sim card registration regulations, which are designed to combat crime and terrorism, a major problem in the country’s north.

“The deadline set for the payment of the fine is 16 November,” NCC spokesman Tony Ojobo is quoted by AFP as having said. “The key issue is if MTN breached the law or not. Certainly, there was a breach. And if there is a breach, we will apply the law.”

News of the fine, which first appeared in the Nigerian media early on Monday morning, has sent MTN shareholders diving for cover. The group’s market capitalisation fell by R64bn between Monday and Wednesday this week. It recovered some ground during intraday trading on Thursday, but was unable to hold on to those gains and ended the session down a further 1% at R154,38 on heavy volumes.

According to AFP, top-level talks kicked off in Abuja on Thursday between MTN, the NCC and officials from the Nigerian government in an effort to find a compromise solution.

The news wire said Ojobo did not specify what further sanctions MTN could face if it fails to meet the 16 November deadline to settle the fine. “If the situation will change in any way, then the government at the top will have to [intervene]direct[ly]. But for now, the mood is to apply the law,” AFP quoted him as saying.

The fine comes as MTN seeks to renew its operating licence in Nigeria. The licence expires next June.  — © 2015 NewsCentral Media

8 Comments

  1. Vusumuzi Sibiya on

    >>“The key issue is if MTN breached the law or not. Certainly, there was a breach. And if there is a breach, we will apply the law.”

    Can’t help but recall the couple of times when I’ve faced-off with some Nigerian security personnel at international events over accreditation that I’d lost or misplaced for the particular event…

    …and in each case where they also knew very well who I was – I came off second best and had to organize for a new accreditation before I was allowed in; with an almost similar line being said to me.

    If only there could be a whole lot more African governments and law enforcement personnel willing to apply the law with no fear or favor…

    Big Ups!! to the NCC.

  2. I agree with you on keeping the law, and as much as I despise MTN for being on the wrong side of bad news all the time and their PATHETIC management and communication of the situation. But you have to admit that the fine is excessive. Actually, completely over the top if you compare the market cap to the value of the subscribers that was suppose to be disconnected.

    Perhaps there is more to this. All this happening soon after a militant president is elected. Perhaps we are seeing the emerging of a new African dictator.

    Standard Bank is also under pressure. Perhaps a real investigative journalist should look into that…

  3. Vusumuzi Sibiya on

    >>The commission has imposed a fine of 200 000 naira (or about R14 000) on each unregistered Sim that was not disconnected in time.

    Seems reasonable enough…

    >>But you have to admit that the fine is excessive.

    No, it isn’t… what is excessive in this case, is the extent of flagrant disregard of the law to the tune of 5.1million unregistered Sims.

    This law applies to all the operators equally and MTN is not being unfairly discriminated against…

    >>All this happening soon after a militant president is elected.

    Perhaps you should consider that this is happening because there has been a president elected that wants to clean-up the awful decay corrupting Nigeria and put the country on the right road to success.

  4. 5.1 million sims in a country touching probably touching 175mil now, and where most people have at least 2 or 3 sim cards is a drop in the ocean.

    Again…. I agree with you. MTN SHOULD be given a fine that hurts them. They deserve every little bit of it. But the total market cap of MTN has already fallen by close to what the fine is.

    Perhaps this is punishment enough. Perhaps not.
    Perhaps this is the wakeup call that MTN shareholders (read Cyril Ramaphosa and other cronies) need?

  5. Vusumuzi Sibiya on

    >>Perhaps this is the wakeup call that MTN shareholders (read Cyril Ramaphosa and other cronies) need?

    It should indeed be a wake-up call… to all the other operators; and to the criminals that had been relying on the new regulations not being effectively enforced.

  6. Ofentse Letsholo on

    For the first time I feel sorry for MTN, that’s huge moola for those 18 days… they should contact Apple and ask for a loan. lol

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