Nigeria\u2019s telecoms regulator on Friday gave MTN Group two weeks to pay a
\n$5.2 billion fine imposed on Africa\u2019s biggest mobile phone company for
\nfailure to cut off millions of users with unregistered SIM cards.<\/p>\n
The Nigerian Communications Commission (NCC) imposed the penalty on Monday
\non MTN\u2019s Nigeria unit, the group\u2019s biggest market by subscribers, sending
\nthe phone operator\u2019s stock tumbling by about 20 per cent this week, though
\nthey bounced 2 percent by midday Friday.<\/p>\n
The fine comes months after Muhammadu Buhari swept to the helm of Africa\u2019s
\nbiggest oil producer after a campaign in which he promised tougher
\nregulation and a fight against corruption.<\/p>\n
The telecoms regulator said MTN failed to disconnect subscribers with
\nunregistered or incomplete SIM cards, after ordering all network operators
\nto do so. NCC said only MTN had failed to comply with the directive.<\/p>\n
A NCC source has said the regulator\u2019s decision was based on advice from
\nNigeria\u2019s state security service, which suspected unregistered SIM cards
\nwere being used for criminal activity in a country facing Islamic militant
\ngroup Boko Haram\u2019s insurgency.<\/p>\n
NCC spokesman Tony Ojobo said MTN had until November 16 pay up, but the
\ntwo sides were in talks to resolve the matter.<\/p>\n
\u201cThe outcome of the discussion may affect the date. That\u2019s why they are
\nhaving the discussion so that they can reach a solution,\u201d Ojobo said.<\/p>\n
MTN declined comment.<\/p>\n
INTERNAL SECURITY<\/p>\n
Nigeria\u2019s presidency and internal security agency were also involved in
\nthe talks, a regulatory source said. MTN Chief Executive Sifiso Dabengwa
\nflew to Abuja to make what three sources familiar with the matter said was
\nan attempt have the penalty reduced.<\/p>\n
If it stands, the fine, almost a quarter of Nigeria\u2019s 2015 budget of $22
\nbillion, would wipe out more than two years of MTN\u2019s annual profits.<\/p>\n
It was unclear what would happen to MTN, whose Nigerian license is up for
\nrenewal in 2016, if the company fails to pay the fine, but NCC\u2019s powers
\ninclude revoking licenses.<\/p>\n
Some analysts said the size of the fine risked damaging Nigeria\u2019s efforts
\nto shake off its image as a risky frontier market for international
\ninvestors.<\/p>\n
\u201cWhy this over-reaching regulation? It simply adds to perceptions about
\nNigeria as unfriendly place for foreign capital,\u201d Vestact fund manager
\nSasha Naryshkine said in Johannesburg.<\/p>\n
But Frost & Sullivan analyst Joanita Roos said the move helped, rather
\nthan damaged, Nigeria\u2019s image. \u201cThe harsh action taken by regulators \u2026
\ndoes in fact protect and contribute positively to the reputation of the
\ncountry.\u201d<\/p>\n
MTN also faces a Johannesburg bourse investigation on the timing of the
\nannouncement that it was facing the penalty. MTN\u2019s confirmation came after
\nnews reports of the fine. South African companies are required to
\nimmediately disclose any price-sensitive information.<\/p>\n","protected":false},"excerpt":{"rendered":"
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