Home » Business & Economy » NCC Explains: MTN Fine Reduced By 25% Only

NCC Explains: MTN Fine Reduced By 25% Only

NCC says Government reduced MTN fine by 25 per cent or $3.9 billion against $3.4 billion earlier claimed by the telecoms operator


Nigerian Communications Commission (NCC) has revealed that Government reduced MTN fine by 25 per cent only and that MTN was wrong to have published wrong information.

Speaking to Information and Communications Technology Journalists in Lagos on Friday, Director of Public Affairs at NCC, Tony Ojobo said Government intervened to reduce the penalty by 25 per cent and that MTN has till December 31 this year to pay its fine of $3.9 billion.

MTN claimed in a statement on Thursday that Government reduce its fine by a third from $5.2 billion to $3.4 billion. Few hours earlier, MTN Nigeria’s Chief Executive Officer, Michael Ikpoki resigned.

According to NCC, MTN was wrong as regards the information it fed the public about the cut by a third.

Ojobo noted that as regards December 31 deadline MTN must meet it as a matter of respect for industry rules.

Answering question on possibility of extending the date, Ojobo said MTN had not approached the regulator to request for extension of payment date.

Ikpoki resigned alongside Head of Regulatory and Corporate Affairs, Akinwale Goodluck. Ferdi Moolman has replaced Ikpoki while Amina Oyagbola is now Head of Regulatory and Corporate Affairs.

NCC imposed fine for failing to cut off unregistered users and wants mobile phone companies to verify the identity of their customers.

The government says it is concerned unregistered Sim cards are being used by criminal gangs.

Reports have it MTN has been in talks with NCC since October when the original fine was imposed.

It said on Thursday it had succeeded in reducing the fine by a third. The original fine amounted to double MTN’s annual profits last year.

Since the fine was imposed by NCC, MTN has made a number of senior managerial changes, which included the resignation of the chief executive of its Nigerian unit, Sifiso Dabengwa. “After further engagements with the Nigerian authorities, the NCC has reduced the imposed fine,” MTN said in a statement. It added the fine was now $3.4bn.

NCC issued a landmark fine of N1.04 trillion against MTN Nigeria, the largest mobile network operator in the country for failing to disconnect subscribers with unregistered and incomplete subscriber identification modules (SIM) cards within the stipulated time. The fine which is the largest in the history of telecom infringements may redefine the relationships between telecommunications operators and the regulator.

Technology Times which broke the story last night said NCC fined MTN Nigeria “for allegedly undermining efforts by the Nigerian government to tackle security challenges and the war on terror and allied crimes, as the telecoms operator has allegedly refused to deactivate unregistered mobile phone lines on its network”.

MTN Group had announced that its Nigerian operation lost 5.1 million subscriber lines in the month of August to the deactivation of incomplete SIM registrations ordered by NCC.

This has led to MTN cutting its fullyear forecast for subscriber numbers. Nik Kershaw, MTN Group spokesman confirmed that MTN Nigeria is also facing “ongoing regulatory restrictions” related to its market-leading position in Africa’s most populous country. About 3.4 million of the customers have been reconnected, the company said.

Mr. Idehen Efosa, head of enforcement and monitory department at NCC, said that out of the 37.79 million lines, Etisalat had 19.46 million improperly registered lines followed by MTN with 18.6 million lines. Airtel has 7.4 million lines while Glo has 2.33 million lines only.

The order to deactivate the lines followed a meeting between Office of the National Security Adviser (NSA), Department of State Service (DSS), the network operators and the NCC to examine the security threats posed by unregistered SIMs. Thereafter, the NCC handed down a seven day ultimatum starting from August 4, 2015 to GSM operators to deactivate unregistered subscriber identification modules (SIMs) with invalidity status.

MTN has 231 million subscribers in 22 countries across Africa, Asia and the Middle East. However, Nigeria is its biggest market. In September, the company was named as most admired brand in Africa in the Brand Africa 100 awards, beating Samsung, while it was also awarded the continent’s most valuable brand, worth $4.6bn (£3bn). MTN was South Africa’s second mobile operator when it was set up in 1994 after the end of apartheid.

It began its expansion across Africa four years later with operations in Rwanda, Uganda and Swaziland.

New chairman, Nhleko is no stranger to the business as he served as Non-executive Director and Chairman of MTN from July 2001 until June 2002 and thereafter as an executive director, Group President and CEO until March 2011. He has subsequently chaired the Group in a Non-executive capacity for the past two and a half years (29 May 2013).

“I will assume responsibility as Executive Chairman for the next 6 months as I proactively deal with the Nigerian regulator and will continue to work with them in addressing the issues around unregistered subscribers as a matter of urgency,” commented Nhleko.

–  Isaiah Onwuanumba

%d bloggers like this: