MTN telecoms giant has proposed a slash of the N1.04 trillion fine imposed on it by Nigerian Communications Commission (NCC) to N300 billion or about 70 per cent discount described by industry sources as paying “chicken change.”
MTN’s N300bn proposed settlement terms comprised the N50bn paid to the government in good faith in February plus N20bn per year for the next five years or N100 bn total cash in addition to buying N80 bn Nigerian bonds plus use of N70 bn of its fibre optic network. Total, by 2020, is N300bn.
The hefty N1.04tr fine was imposed last year by the telecom regulator, NCC when MTN failed to meet the deadline to deactivate 5.1 million improperly registered SIM cards on its network.
The fine was cut down by 25 per cent to N780bn after the firm entered into negotiations with the government, but as the deadline to pay up approached, it filed a suit to contest NCC’s powers to fine it.
Last week, however, MTN withdrew the matter from court and paid an initial N50 billion, a paltry 6.4 per cent as a show of good faith and it is now requesting that the overall fine be further reduced to N300 billion, the N50bn included.
However, the Senate Committee on Communication on Wednesday condemned the secrecy surrounding the out-of-court settlement negotiations between the federal government and MTN.
The Senate also kicked against the alleged exclusion of Ministry of Communication and the communication experts at NCC from the negotiations.
At an open investigative hearing convened by the committee at the National Assembly Thursday, the lawmakers expressed shock that a “Recovery Account” was opened for the N50bn good faith fine paid by MTN.
Worse still, the committee was not pleased that the “chicken change” proposal initiated by MTN to reduce the fine to N300 billion was accepted blindly by Minister of Justice and Attorney-General of the Federation Abubakar Malami even without consulting experts at Ministry of Communication and NCC.
It also emerged at the hearing that an initial 25 per cent reduction of the initial N1.04 trillion fine to N780 billion was on the orders of the President.
A document displayed by the committee regarding the proposal from MTN showed that the telecommunication service provider would pay N300 billion in three installments.
According to the document, the N50 billion already paid is part of this amount.
The parties have agreed that the N50 billion paid in good faith and without prejudice by MTN Nigeria on February 24, 2016, in order to commence settlement negotiations, will form part of the cash settlement.
In five annual instalments of N50 bn each, between now and December 31, 2020, MTN Nigeria shall pay N100 billion to the federal government recovery account in Central Bank of Nigeria. This payment will commence by 31 December, 2016, and will be made by 31 December of each subsequent year.
The proposal stated that MTN would buy N80 billion of Nigeria’s foreign bond.
The proposal, which the committee said it got from the office of the Attorney General of the Federation, was admitted by MTN.
It states in part: “As a demonstration of its commitment to, and confidence in the Nigerian economy, and subject to necessary regulatory approvals, MTN Nigeria commits to purchase N80 billion of Nigerian Sovereign Debt issued on international market in 2016 to 2017.”
The proposal also showed that MTN would provide Nigeria with access to the company’s fibre network for the purpose of allowing the federal government to expand its e-initiatives to the tune of N70 billion.
Defending himself on the allegation of opening the recovery account, the accountant-general of the federation, Ahmed Idris, said he acted on the demand of the attorney-general of the federation, adding that he was never aware of what money was going to be put in the account.
A representative of the attorney-general of the federation, Mr Dayo Akpata, tried in vain to convince the committee about the wisdom in opening the account.
The committee simply insisted that the attorney-general must appear in person before it within two weeks to explain the action.
Chairman of the committee, Senator Gilbert Nnaji, had earlier explained the mission of the committee regarding the investigation.
“As a committee, we find it worrisome, on one hand, that the issue of compliance on the part of MTN could linger till now and, on the other hand, that N50 billion was claimed to have been paid by MTN out of reduced fine of N780 billion.
“Empowered by Sections 88 and 89 of the Constitution with the power of oversight over our nation’s telecoms landscape, it becomes imperative for the committee to wade into the matter with special attention to the controversy surrounding the payment of N50 billion by MTN, which accounts for a paltry 6.4% of the total reduced fine of N780 billion.
“In fulfilling of our mandate of oversight, we are shocked to gather from the regulator, NCC, that the Commission neither received the payment of the N50 billion nor was it notified of such payment. There were claims and counter-claims on the pages of newspapers that the Honourable Minister of Communications Technology had acknowledged the payment, while other sources claimed that MTN paid the money into Central Bank of Nigeria’s Recovery Account.
“This is the crux of the meeting: to establish the veracity of this payment and to which account was it paid, if paid. This is one transaction that has generated public suspicion compelling the committee to invite all relevant stakeholders to this meeting for adequate clarifications to be made on the issue.
“Issues emanating from the foregoing are: Into which account did MTN pay the N50 billion and which government agency acknowledged the payment? If MTN actually paid, why did it disregard payment into NCC’s coffers as statutorily obliged? If MTN paid into CBN’s Recovery Account, on whose directive did the network do so and what legal riglt does CBN have to lodge the money in a Recovery Account?
“These and many more are posers that this meeting seeks to unravel for Nigerians to know the true picture of the situation,” Senator Nnaji said.
-Leadership
