MTN fined N1.4tr over un­reg­is­tered users

Daily Trust - - FRONT PAGE - By Zakariyya Adaramola & Nahimah Ajikanle Nu­rudeen

The Nige­rian Communications Com­mis­sion (NCC) has fined MTN $5.2bn (N1.4 tril­lion) for fail­ing to dis­con­nect mil­lions of its un­reg­is­tered sub­scribers at the end of the Au­gust dead­line set by the reg­u­la­tory body.

The penalty, ac­cord­ing to the NCC, rep­re­sents N200,000 ($1,000) for each of the un­reg­is­tered 5.1 mil­lion SIM cards.

From 2012 when the SIM reg­is­tra­tion started, SIM card buy­ers had to reg­is­ter the card un­der their name by law.

But the tele­coms reg­u­la­tor found out in Au­gust that the tele­coms op­er­a­tors did not carry out the ex­er­cise prop­erly on 38.78mil­lion sub­scribers, and they were di­rected to rereg­is­ter the sub­scribers within one month or be sanc­tioned.

NCC’s Head of Com­pli­ance and Mon­i­tor­ing Unit, Efosa Ide­hene said the com­mis­sion had cited poor fin­ger prints, no fa­cial in­for­ma­tion and other bio­met­ric chal­lenges for the in­com­plete­ness of the sub­scribers’ reg­is­tra­tion.

A source in NCC said MTN was fined af­ter it failed to carry out the com­mis­sion’s direc­tive de­spite re­peated warn­ings.

Daily Trust re­ports that the

fine is un­prece­dented in the his­tory of telecom in­fringe­ments in Nige­ria.

‘We are in talks with NCC’

But MTN in a state­ment yes­ter­day said it was dis­cussing with the NCC over the fine and hoped to re­solve the mat­ter soon.

MTN’s Cor­po­rate Ser­vices Ex­ec­u­tive, Ak­in­wale Good­luck said: “Lead­ing ICT com­pany in Nige­ria, MTN con­firmed that the Nige­rian Communications Com­mis­sion (NCC) has im­posed a N1.4 tril­lion fine ($5.2bn) on MTN Nige­ria. This fine re­lates to the tim­ing of the dis­con­nec­tion of the 5.1 mil­lion MTN sub­scribers that were dis­con­nected in Au­gust & Septem­ber 2015 and is based on a N200,000 fine for each im­prop­erly reg­is­tered sub­scriber. MTN Nige­ria is cur­rently en­gag­ing with the NCC to re­solve the mat­ter.”

It said $5.2 bil­lion is equiv­a­lent to at least two av­er­age years’ profit for MTN Nige­ria and nearly three times the $1.8 bil­lion it in­vested in Nige­ria, ac­cord­ing to the com­pany’s web­site.

As a re­sult of the news of the fine, shares in South Africa’s MTN dropped more than 5 per­cent yes­ter­day.

“The re­port is def­i­nitely the rea­son why it is mov­ing. We just don’t know how cred­i­ble it is,” said Petri Redel­inghuys, a trader at Inkhunzi In­vest­ments in Jo­han­nes­burg.

A sec­ond trader con­firmed the share was fall­ing as a re­sult of the re­port, Reuters re­ported.

Stake­hold­ers, sub­scribers speak

Re­act­ing to the sanc­tion, the pres­i­dent of As­so­ci­a­tion of Li­censed Telecom­mu­ni­ca­tions Op­er­a­tors of Nige­ria (ALTON) Mr Gbenga Adebayo said: “We need to han­dle this is­sue of sanc­tion very care­fully as it may send wrong sig­nals to would-be in­vestors both in our sec­tor and in other sec­tors of the econ­omy.”

Also, Chief De­olu Ogun­banjo, the Pres­i­dent, Na­tional As­so­ci­a­tion of Tele­coms Sub­scribers said NCC’s fine against MTN is dou­ble jeop­ardy.

This, he said, is be­cause MTN alone could not be blamed for the woes in the SIM reg­is­tra­tion ex­er­cise.

Ac­cord­ing to him, the agent hired by the NCC to carry out the ex­er­cise also failed to do due dili­gence to SIM reg­is­tra­tion ac­tiv­i­ties.

He noted that the per­son­nel em­ployed by those agents lacked the tech­ni­cal skills to carry out the ex­er­cise apart from meet­ing with the daily tar­gets of 50-70 daily reg­is­tra­tion.

Ogun­banjo said NCC had not come to terms with its fail­ure in the SIM reg­is­tra­tion scheme. He said the com­mis­sion em­ployed an agent for each geo po­lit­i­cal zone and one for Lagos con­sid­er­ing the state pop­u­la­tion, adding that

He sug­gested that in­stead of the reg­u­la­tor fin­ing the ser­vice providers, the op­er­a­tors should be com­pelled to give N2000 worth recharge cards to each sub­scriber for the rig­ors they went through in the SIM reg­is­tra­tion ex­er­cise.

This he de­scribed as a way of ap­pre­ci­at­ing the sub­scribers par­tic­u­larly those who went and are still go­ing thor­ough rereg­is­tra­tion.

Why only MTN got the stick

A se­nior NCC of­fi­cial told Daily Trust yes­ter­day that the com­mis­sion was firm on im­ple­ment­ing this lat­est sanc­tion on MTN.

He said the com­mis­sion had re­turned 18.6 mil­lion SIM cards data to MTN; 7.4 mil­lion to Air­tel; 2.2 mil­lion to Globa­com and 10.4 mil­lion to Eti­salat for cor­rec­tions and all of them ex­cept MTN had made the cor­rec­tions.

Ac­cord­ing to the source, the NCC early this month sum­moned MTN and three other op­er­a­tors to its Abuja head of­fice where they were re­quested to ex­plain why they failed “to dis­con­nect im­prop­erly reg­is­tered sub­scribers on their net­works.

“Con­se­quently, the com­mis­sion or­dered all the op­er­a­tors to go and dis­con­nect the sub­scribers and all other op­er­a­tors did just that ex­cept the MTN hence the sanc­tion,” the source said.

NCC had ear­lier in Septem­ber fined MTN, Glo, Air­tel and Eti­salat N120m for fail­ing to dis­con­nect sub­scribers with in­com­plete reg­is­tra­tion but it is not clear whether they have paid the fine or not.

On Thurs­day, Pres­i­dent and Chief Ex­ec­u­tive Of­fi­cer of MTN Group Si­fiso Dabengwa said the com­pany lost over 5 mil­lion sub­scribers as a re­sult of stiff com­pe­ti­tion and tougher reg­u­la­tion in the Nige­rian mar­ket.

“Ag­gres­sive price com­pe­ti­tion, weak­en­ing macroe­co­nomic con­di­tions in most of our mar­kets and un­favourable ex­change rate move­ments con­tin­ued to im­pact financial per­for­mance for the quar­ter,” Dabengwa said.

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