N1.04trn fine: MTN risks additional sanctions

As the deadline for the payment of N1.04 trillion fine imposed on MTN Nigeria ends today, the telecommunication company may incur additional sanctions if it fails to pay at the close of business. The Nigerian Communication Commission (NCC) imposed the fine on MTN over SIM deactivation default.

Though the newly sworn-in Minister of Communications, Adebayo Shittu, SAN, has stated that Nigeria does not want MTN to quit the country because of a $5.2 billion fine, he insisted that the law supersedes every other thing.

Sources close to the regulatory authority of the sector hinted that there may be more troubles for the company if it fails to pay the fine today.

But another source said MTN may be pushing for staggered payment as the government remains adamant on the payment of the fine in full.

According to the minister, “Nothing is on my table yet, but I am so sure that nobody wants MTN to die. Nobody wants MTN to shut down, but a judgment has been given, as it were, and the period for enforcement has not yet shifted.”

When asked about the consequences of non-payment, Shittu added “the law would be followed.” He did not give details but insisted: “We don’t want them to leave.”

Nigerian Communications Commission (NCC) spokesman, Tony Ojobo, has said “the key issue is whether MTN breached the law or not. Certainly, there was a breach. And if there is a breach, we will apply the law. The deadline set for the payment of the fine is November 16.”

On what would happen if MTN failed to meet the deadline, Ojobo said: “When we get to the bridge, we will know how to cross it. The deadline set for the payment of the fine is November 16.

“If the situation will change in any way, then the government at the top will have to so direct. But for now, the mood is to apply the law.”

Newswatch Times gathered that senior officials of the Nigerian government, the NCC and MTN began talks in Abuja on Thursday to find solution to the matter, but they did not specify what precise sanctions MTN could face if it fails to pay today.

It would be recalled that early in August, the NCC issued a directive to mobile telecoms companies operating in Nigeria to deactivate all unregistered SIM cards within seven days or face severe sanctions.

MTN — Africa’s largest telecoms firm — missed the deadline to deactivate its 5.1 million unregistered subscribers which then attracted 200,000-naira ($1,000) fine for each unregistered SIM.

Under the law, the NCC’s powers include “granting or revoking of permits for connection of customer equipment” and “determination of services and new undertakings eligible for licensing from time to time.”

Nigeria has been pushing telecom operators to verify the identity of subscribers due to concerns that unregistered SIM cards are being used for criminal activity or even by Boko Haram militants waging an Islamist insurgency in the North-East.

Speaking to Reuters about his plans for the sector, Shittu said telecoms was key to helping President Muhammadu Buhari’s goal of diversifying the economy away from oil.

Shittu said telecoms provided a quicker avenue for new growth than agriculture, another sector the government wants to expand.

Nigeria has been hammered by the drop in global crude prices and growth in gross domestic product more than halved in the second quarter compared with the same period in 2014.

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