N1.04TRN FINE: NCC, MTN play hide and seek on deadline day

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The tension and high anticipations trailing the N1.04 trillion fine the Nigerian Communications Commission, NCC, imposed on MTN Nigeria and the November 16, 2015 payment deadline, melted in utter confusion, Monday, as both the commission and the telecommunications company released very little information on whether the payment was made or not, on deadline day.

While MTN Group issued a statement, addressing its shareholders, intimating them of ongoing negotiations with the Nigerian government on the issue, the NCC went into memory lane with its own statement, explaining why it imposed the fine.

Neither MTN in its 4-paragraph statement or NCC in its 19-paragraph press statement paid much attention to the deadline which all Nigerians were looking forward to.

Even as most of the NCC’s reasons for the fine were already in public domain, the commission failed to provide adequate information as to whether MTN has paid the fine or not, what manner of negotiations were going on between the two parties and apparently when the new deadline would be.

Stakeholders kick: Some Nigerians, who felt they were taken for granted in such a sensitive issue, queried why it would take MTN Group based in South Africa to tactically reveal that the deadline has been shifted.

A Lagos based Valued Added services provider, Mr fatai Adebayo said “ I still cannot believe that on deadline day for an unprecedented fine of this nature, the NCC has rightly imposed on MTN, the commission itself has refused to say what is going on or make statement on way forward. It even took the parent company of the offender, for us to know there are negotiations going on and therefore the payment was not made.

Material development

It seems MTN is winning in this case, with a strategically executed Public Relations plan. It obviously should not be the case. NCC should wake up and speak more on this saga.”

Negotiations continue: The MTN statement, reads “Shareholders were advised in previous SENS announcements that the Company would update shareholders on all material developments on this matter.

Shareholders are advised that the Executive Chairman of the Company, Mr Phuthuma Nhleko, has personally met with the Nigerian authorities to continue the ongoing discussions with them regarding the fine of N200,000 for each unregistered subscriber, the fine, the equivalent of US$5.2 billion imposed on MTN Nigeria by the Nigerian Communications Commission NCC. These discussions include matters of non-compliance and the remedial measures that may have to be adopted to address this.

Although the Nigerian Communications Commission, NCC set a deadline for payment of the fine by Monday, 16 November 2015, shareholders are advised that the Nigerian authorities have, without prejudice, agreed that the imposed fine will not be payable until the negotiations have been concluded.

“ MTN is committed to resolving the matter together with the NCC as soon as possible and will continue to update stakeholders of any material developments regarding the afore-mentioned fine via SENS. Accordingly, shareholders are advised to continue to exercise caution when dealing in the Company’s securities until a further announcement is made”.

We acted in public interest- NCC

Meanwhile, the commission has restated that the fine was imposed in public interest. The lengthy NCC statement, signed by its Director Public Affairs, Mr Tony Ojobo, reads: “Following the sanctions placed on MTN Nigeria, by the Nigerian Communications Commission (NCC), members of the public have expressed diverse interest as to what actually transpired.

The fine was a result of violation of Section 20(1) of the Registration of Telephone Subscribers Regulation of 2011.

Subscribers regulation

Section 20 (1) of Registration of Telephone Subscribers Regulations 2011 states that:

“Any licensee who activates or fails to deactivate a subscription medium in violation of any provision of these Regulations is liable to a penalty ofN200,000.00 for each unregistered but activated subscription medium.”

The fine of N1.04Trillion on MTN Nigeria by the Nigerian Communications Commission (NCC) was done in the interest of the public which has been at the receiving end of security challenges.

Consequent upon the overwhelming evidence of non-compliance, and obvious disregard to the rule of engagement by MTN, the NCC had no choice but to impose the sanctions.

MTN, in a letter on November 2, 2015 admitted the infraction and pleaded for leniency. The Commission has acknowledged this and is looking into their plea without any prejudice to the fine. The fine remains but the appeal and other engagements with MTN may affect the payment deadline.

The fine that was imposed on MTN was the second within two months after the operators were given a seven-day ultimatum to deactivate all unregistered and improperly registered Subscriber Identification Module (SIM) Cards. While others complied, MTN did not.

On August 4, 2015, at a meeting of all the representatives of the Mobile Network Operators (MNO), with NCC, major security challenges through preregistered, unregistered and improperly registered SIM Cards topped the agenda after which Operators were given the ultimatum to deactivate such within seven days.

On August 14, 2015, three days after the ultimatum expired, NCC carried out a network audit; while other Operators complied with the directive, deactivating improperly registered SIM Cards on their networks, MTN showed no sign of compliance at all.

Recall that four (4) Operators; MTN, Airtel, Globacom and Etisalat, were sanctioned in August for none compliance with regards to the directive to deactivate the improperly registered SIM Cards. MTN got a fine of N102.2Million, Globacom N7.4Million, Etisalat N7Million and Airtel N3.8Million fine. Others complied while MTN flouted the fine.

Based on the report of the compliance Audit Team, an Enforcement Team which visited MTN from September 2 – 4, 2015 wherein MTN admitted that the Team confirmed that 5.2million improperly registered SIM Cards were still left active on their network; hence, a contravention of the Regulations was established.

Consistent with the Commission’s enforcement process, MTN was by a letter dated October 5, 2015, given notice to state why it should not be sanctioned in line with the Regulations for failure to deactivate improperly registered SIM Cards that were found to be active at the time of enforcement team’s visit of September 15, 2015.

On October 19, 2015, the Commission received and reviewed MTN’s response and found no convincing evidence why it should not be sanctioned for the established violations.

Accordingly, by a letter dated October 20, 2015 the Commission conveyed appropriate sanctions to MTN in accordance with Regulations 20(1) of the Telephone Subscribers Registration Regulation 2011, to pay the Sum of N200,000.00 only for each of the 5.2million improperly registered SIM Cards.

The statement further averred that:

In order to ensure proper identification of telephone subscribers with their biometric data and in line with international best practice, the Commission came up with a framework for the registration of telephone subscribers in Nigeria. (Nigerian Communications Commission Registration of Telephone Subscribers Regulations 2011).

The above Regulations were developed with the full participation of all key industry Stakeholders including all Mobile Network Operators (MNO) in 2011.

The Commission on its part has a statutory responsibility to monitor and enforce compliance to the rules, more so, when national security is at stake”.

The statement explained that, National interest is paramount because when lives are lost they cannot be replaced.

However, a Nigerian technology reporter who became miffed over this development blurted out: “from this statement, some of us are of the opinion that even the NCC has committed infraction by agreeing to stay deadline just for the sake of negotiation that is clearly unknown to the 2011 SIM Regulation on which, ab-intio, it relied upon to impose the fine.

Source: Vanguard