The Nigeria Governors’ Forum (NGF), a body of chief executives of states across Nigeria, has taken a position that MTN Nigeria, the biggest mobile phone operator in the country, should pay the N1.2 trillion fine imposed on the company by the telecoms industry regulator.
The position of the Governors further complicates MTN Nigeria’s plea for leniency after the mobile phone allegedly admitted that it committed the offences of breaching SIM registration rules set by the telecoms industry regulator, the Nigerian Communications Commission (NCC).
Governors meeting with President Muhamadu Buhari today in Abuja, the nation’s seat of political power, supported the imposition of the N1.4 trillion fines on the mobile phone company by NCC, which was also exclusively reported by Technology Times.
Negotiations on the MTN fines have been taken at the top levels of the Nigerian government because it is believed that the matter borders more of national security, than on just telecoms rules infractions, people in government told Technology Times.
The Governors insist that MTN Nigeria, the local subsidiary of South Afrcia’s MTN Group, should pay the fines, imposed for allegedly refusing to deactivate unregistered SIMs on its network.
The Governors’ Forum said in a statement after the meeting with President Buhari that it supported the imposition of the fines by NCC.
Speaking with journalists after the meeting, Governor Abiola Ajumobi of Oyo State told newsmen that MTN Nigeria must be made accountable for allegedly breaking Nigeria’s law, according to Channels TV news report monitored in Lagos.
According to the Oyo State Governor, the Governors Forum supports the NCC on the fine, and has adopted the position “that MTN should pay the fine.”
According to him, “the law is the law.”
The Governors are wading into the matter only days after NCC maintained a tough stance on the matter saying the decision to sanction MTN Nigeria, over allegation that over 5.2 million unregistered phone lines were discovered on its network, “was taken in public interest.”
Meanwhile, South Africa’s MTN Group, owners of MTN Nigeria has issued a cautionary note to its local market that it was in discussions with authorities in Nigeria to resolve the matter.
MTN Nigeria was able to get a respite that it will not receive further sanctions despite its failure to meet last Monday’s deadline to pay the full fines, or risk further punitive actions.
The deal reached weekend will see MTN Nigeria, owned by South Africa’s MTN Group, not facing further sanction for its expected failure to meet payment deadline for the fines until negotiations are completed, NCC and MTN have confirmed.
Mr. Phuthuma Nhleko, Executive Chairman of MTN Group, who led top officials of the mobile phone company to a meeting at the Presidential Villa, the Nigerian seat of government and subsequently the NCC Headquarters in Abuja last Friday.
Under the deals reached between both parties, no new sanction will apply pending the conclusion of ongoing talks to resolve the matter as NCC was allegedly swayed by MTN’s letter, which not only admitted the alleged SIM Registration infraction, but went further to seek the regulator’s leniency on the hefty ₦1.04 trillion fines.
Buoyed by assurances it received from authorities in Nigeria, the Johannesburg-based MTN Group Monday advised the market of the key deals reached with the NCC not to pay the fines until “the negotiations have been concluded.”
According to a statement issued today by MTN Group, “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.”
According to the mobile phone company, “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.”
On the Nigerian side, NCC says that despite the respite for the mobile phone company, it was silent on the decision taken on the fines in its announcement last Monday.
Mr. Tony Ojobo, Director, Public Affairs at NCC recounted the chain of incidents that resulted in the fines saying that the decision was taken by the regulator because of the violation of Section 20(1) of the Registration of Telephone Subscribers Regulation of 2011.
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 of N200, 000.00 for each unregistered but activated subscription medium.”
According to the NCC, the fine of N1.04 trillion imposed on MTN Nigeria “was done in the interest of the public which has been at the receiving end of security challenges.”
Ojobo says that, “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.”
He adds that, “MTN, in a letter of 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.”
According to NCC, 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.”
The regulator adds that “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.”
Ojobo adds that, “on August 14, 2015, three days after the ultimatum expired, NCC carried out a network audit. While other operators complied with the directive to deactivate the improperly registered SIM cards, MTN showed no sign of compliance at all.”
Meanwhile, four operators including MTN, Airtel, Globacom and Etisalat were sanctioned in August this year for non-compliance with the directive to deactivate the improperly registered SIM cards, NCC says.
MTN got a fine of N102.2 million, Globacom, N7.4 million; Etisalat, N7 million and Airtel, N3.8 million fine, according to NCC which also confirmed that, “others complied while MTN flouted the fine.”
Ojobo adds that, “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 5.2 million improperly registered SIM cards were still left active on their network; hence a contravention of the Regulations was established.”
Following this, 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, a move which Ojobo says was “consistent with the Commission’s enforcement process.”
He adds that, “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.”
NCC was later to convey the sanctions by a letter dated October 20, 2015 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 5.2 million improperly-registered SIM cards.”