N1.04tn Fine: MTN Pleads For Staggered Payment

MTN has asked Nigeria for a plan to allow it to stagger the payment of a $5.2bn (N1.04tn) fine as the deadline for the payment expires today (Monday) , a source at the Nigerian Communications Commission said on Sunday. The source added that the government was considering the request, made at a meeting on Friday between MTN and high-level government officials, and that the decision would be disclosed on Monday.

The Federal Government at a meeting with MTN officials on Friday night rejected pleas by the mobile company to have the fine slashed. It was learnt that the Federal Government insisted that the rule should be followed since the rule that was contravened was clear. Failing to obtain a reduction, MTN officials were said to have asked to have the payment staggered over a period of two years. By the end of the meeting on Friday, the proposal had not been accepted.

However, it was learnt that there were would be another round of meeting on Sunday night to resolve the knotty issue.

If the Sunday night meeting resolved the issues, the Federal Government may speak on the matter within two days, it was gathered. Since the imbroglio, neither NCC nor the Federal Government has officially spoken on the matter. The NCC slapped the fine on MTN last month for its failure to cut off 5.2 million unregistered SIM cards.

MTN spokesman Chris Maroleng said, “We are waiting for authorities to come back to us”.

Nigeria has been pushing telecommunication operators to verify the identity of subscribers due to concerns that unregistered SIM cards are being used for criminal activity or even by Boko Haram militants waging an Islamist insurgency in the northeast. “At the meeting, MTN pleaded passionately for staggered payment since the option of reduction of the fine had been ruled out,” the NCC source told Reuters.

However, a source familiar with the discussions said that an eleventh hour reduction of the fine could still be possible.“Until the final announcement is made, there may be some room for manoeuvre,” the source familiar with the situation said.

The fine – if fully enforced – amounts to more than the past two years’ profit for the MTN in its biggest market. The new Minister of Cmmunications, Adebayo Shittu, told Reuters on Friday the government did not want the MTN “to die” or shut down operations as a result of the penalty. The fine is based on $1,000 per outstanding unregistered SIM card, as stipulated by Nigerian telecommunications laws.

Nigeria accounts for 37 per cent of revenues for MTN, which operates in more than 20 countries in Africa and the Middle East. Since the announcement of the fine, its shares have lost nearly 25 per cent of their value.

-Punch