Efforts by MTN Nigeria to reduce the $5.2bn (N1.04 trillion) fine imposed on it by the Nigeria industry regulator, the Nigeria Communications Commission, NCC reduced over its failure to deregister over five million unregistered lines on its network seemed to have hit the brick wall at least for now.
NCC said on Monday that it is considering shifting the payment deadline which fell due today, 15 November because of appeal from the telecommunications company and the fact that it has acknowledged that it ran foul of the industry regulations over its failure to deregister the telephone lines.
In a statement signed by Tony Ojobo, NCC Director of Communications, he said the engagement with the telecommunications company over the fine is still ongoing.
The statement confirmed earlier claims by MTN early Monday that NCC has reviewed the deadline for the payment of the fine it imposed on MTN for defying regulatory directives following a series of meetings with the regulator.
Phuthuma Nhleko, MTN executive chairman said in the statement that he has personally met the Nigerian authorities to continue the ongoing discussions regarding the fine of N200, 000 for every unregistered subscriber.
According to him, the discussions include matters of non-compliance and the remedial measures that may have to be adopted to address the matter.
“Although the Nigerian Communications Commission set a deadline for payment of the fine by Monday, November 16 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, the company said,” Nhlehko said in the statement which was obviously designed to calm potential negative consequences on its shares as a result of the payment of the hefty fine.
“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 said in the statement in which it also tried to justify the hefty fine on the company which it said was in “public interest.”
While explaining the circumstances that led to the imposition of the penalty, the regulatory agency said it had earlier imposed fines on all mobile operators in the country over their failure to comply with its directives on deactivation of unregistered SIM on their networks.
The NCC said in the first round of fines in August, 2015, it fined Globacom N7.4 million, Etisalat N7 million, Airtel N3.8 million and MTN N102.2 million. It however noted that while the other companies paid the fines, MTN refused.
“On August 4, 2015, at a meeting of all the representatives of the Mobile Network Operators (MNO), with NCC, major security challenges through pre-registered, 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 none compliance of 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.
The N1.04 trillion fine, NCC said was the second to be imposed on MTN and it was for its failure to deactivate 5.1 million unregistered lines.
“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.
On how it arrived at the fine, considered humongous by many Nigerians, NCC said it was the penalty for 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.”
“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 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. “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.
“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.”