MTN Gets Friday Deadline To Pay US$5.2b Fine

Nhaleko, MTN Nigeria Interim CEO

The Nigerian Communications Commission (NCC) yesterday extended to Friday the deadline given to MTN to pay a US$5.2billion fine. The commission also said it sanctioned the telecommunications giant based on security reasons following its failure to deactivate 5.2million unregistered SIM cards.

It said it acted in the national interest and to protect innocent Nigerians from falling victim of terrorists using unregistered SIM cards.

According to a top shot in NCC, the deadline was extended to Friday for more consultations.

The source said: “Although the deadline expired on Monday, we have extended it to Friday to enable all parties to conclude ongoing talks.

The Nation report continues:

“Definitely by the end of the week (Friday), we will issue another statement. We hope that we would have finalized ongoing discussions in the interest of all parties. Our official position will be known by the end of the week.

“We decided not to be rigid about the deadline to allow for the conclusion of talks.”

The NCC, in a statement by its Director, Public Affairs, Mr. Tony Ojobo, broke its silence on why MTN was sanctioned.

It said the sanctions became inevitable because national security was at stake.

The NCC statement said: “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.

“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 ₦200,000.00 for each unregistered but activated subscription medium.”

“The fine of ₦1.04trillion 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 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.”

NCC also gave the details of how MTN had committed infractions and its neglect of warnings.

It added: “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, to deactivate the improperly registered SIM Cards, MTN showed no sign of compliance at all.

“Please recall that four (4) Operators; MTN, Airtel, Globacom and Etisalat, were sanctioned in August for non-compliance of the directive to deactivate the improperly registered SIM Cards. MTN got a fine of ₦102.2million, Globacom ₦7.4million, Etisalat ₦7million and Airtel ₦3.8Million 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 ₦200,000.00 only for each of the 5.2million improperly registered SIM Cards.”

The statement said all stakeholders in the industry were part of the registration of telephone subscribers.

It said: “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.

“As a responsible Regulator, the NCC will not stand by and watch Rules and Regulations for Engagement being flouted by any Operator.

“The Commission has adopted a smart regulation in its oversight function in the industry, hence it has always weighed the implications of sanctions that is why it had to place the appropriate sanction accordingly.”

The NCC statement further said that sanctions are the last resort after all overtures fail but this does not in any way undermine Industry Standards and the interest of Investors.