Three days after Nigerian Communications
Commission, NCC slammed a N1.4 trillion penalty on MTN Nigeria for
failure to disconnect customers with unregistered SIM cards, Parent
company MTN group has cried out that the fine was too extreme, even as
it continues to engage the regulator on how to resolve the issue.
MTN Group noted with dismay that Nigerian Communications Commission
refused to listen to its plea to reconsider its stand on the penalty
slammed on its Nigerian arm last week.
According to a report, MTN Nigeria spokeswoman, Chineze
Gbenga-Oluwatoye, had said in an e-mailed response, that
“recommendations were put forward with respect to the non-commensurable
nature of the fine but the Nigerian Communications Commission did not
accept recommendations that the fine of 200,000 Naira ($1,005) per SIM
was too heavy.”
‘‘MTN Nigeria contacted the regulator with concerns that a demand to
disconnect SIM cards by a certain deadline would cause “severe
disruption” for customers and recommended a staggered process to limit
the possible impact,’’ said Oluwatoye.
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The phone operator had said on Monday that the Nigerian Communications
Commission is seeking the penalties because it missed a deadline to
disconnect 5.1 million subscribers and is reviewing its management in
the country.
Moody’s Investors Service had on Thursday lowered it’s rating for MTN to negative from stable following the fine.
“Key concerns raised to the NCC highlighted the difficulty of
carefully reviewing the data on 18.6 million records within the one week
deadline to ensure identification and disconnection of only affected
subscribers,” Oluwatoye added.
Meanwhile, Financial analysts have pointedly said that Nigeria
government is at risk of scaring off investors it can’t afford to lose
if the N1.4 trillion fine slammed on MTN holds through.
With an economy struggling to cope with sliding oil prices, the
experts said currency restrictions and no finance minister, authorities
are doing themselves no favors by penalizing one of their biggest
foreign investors.
According to fund managers including David McIlroy of Alquity
Investment Management Limited, the fine equates to more than 20 percent
of Johannesburg-based MTN’s market value.
“It’s the last thing Nigeria needs, given the economic and political
struggles it’s contending with at the moment,” McIlroy, chief investment
officer at Alquity, which oversees $100 million of frontier market
stocks, including MTN shares, said by phone from London.
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