Finally, NCC, MTN Reach Truce as Fine is Reduced to N330bn


led by the Attorney General of the Federation (AGF) and Minister of Justice, Mr. Abubakar Malami (SAN).

The President of South Africa, Jacob Zuma, had to also fly into Nigeria to continue negotiation on the matter.

This was after the NCC handed over the matter to the Presidency, at a time the NCC had no governing board to take decision on the matter.

The huge fine of N1.04 trillion, no doubt, caused panic within the management of MTN, which led to the resignation of three top executive officers. The first was the former Chief Executive Officer of MTN Group, Mr. Sifiso Dabengwa who was relieved of his job, but made to resign honourably.

He was immediately replaced by an Acting Executive Chairman, Phuthuma Nhleko.

Few weeks after his resignation, the former Chief Executive Officer of MTN Nigeria, Mr. Michael Ikpoki, and the former Head, Regulatory and Corporate Affairs of MTN Nigeria, Mr. Akinwale Goodluck also resigned from their positions

Both had tendered their resignation letters at the heat of the challenge, occasioned by the N1.04 trillion, which drastically affected the shares of MTN in South Africa.

Since the fine was announced in October 26, MTN stock in South Africa had declined by about 25 per cent, according to Bloomberg report, and the decline continued for some months, having created panic among shareholders.

THISDAY gathered that MTN Group was unhappy with the way the fine issue was handled in Nigeria, blaming it on the structure of MTN management, where CEOs from various regions report directly to Dabendwa, a structure that Dabengwa instituted immediately he was appointed Group CEO of MTN.

The structure was a deviation from the initial structure, where Country specific CEOs report to a regional head, who will in turn report the CEO. The new structure instituted by Dabengwa, made it difficult to address issues fast, since every CEO reports directly to the Group CEO, who takes some time before responding to their queries.

It was gathered that Ikpoki had reported to Dabengwa on the MTN Nigeria fine, but that Dabengwa did not treat the matter as urgent as it should, a situation that made the issue to degenerate.

Ikpoki and Goodluck, who were the most senior management staff of NCC before their forced resignation, were said to have handled the issue with kids glove and allowed MTN to violate such sensitive fine.

Although the NCC said it acted according to the law by imposing N1.04 trillion on MTN, the telecoms regulator, however said it never envisaged that MTN would breach the law on SIM card deactivation to the extent of keeping up to 5.2 million unregistered and improperly registered SIM cards on its network, knowing fully well that each defaulting SIM card, attracts N200,000.

NCC had in October 2015, fined MTN the sum of N1.04 trillion for its refusal to deactivate 5.2 million unregistered and improperly registered SIM cards on its network.

NCC had fixed a penalty of N200,000 for a single infraction on SIM card deactivation and it was discovered that MTN had 5.2 million infractions, which was the number of invalid SIM cards that were not deactivated on the MTN network, which amounted to N1.04 trillion.  After several negotiations and pleas from MTN, the NCC later reduced the fine by 25 per cent, to N780 billion, but MTN was not satisfied with the reduction and decided to seek redress in law court in December 2015, challenging the powers of NCC to impose such a whooping sum on a single operator.

In February 2016, MTN withdrew the case from court on the advice of the federal government, as a condition for a renewed negotiation, which MTN kept asking for.

To appease the federal government, MTN paid N50 billion to government, immediately it withdrew the case and continued in the negotiation for a peaceful resolution of the matter.