Nigeria Not Keen on Out of Court Settlement with MTN

Adebayo Shittu


Nigerian government is not keen on settling out of court with MTN Nigeria over the N1.4 trillion fine imposed on it for having 5.2 million unregistered subscribers on its network unless the telecom giant withdraws the case in court

By Anayo Ezugwu  | Jan 26, 2016 @ 01:00 GMT  |

THE Nigeria government and the MTN Nigeria has continued to play hide and seek over the  N1.04 trillion fines imposed on the latter by the Nigerian Communications Commission, NCC, for having 5.2 million unregistered subscribers on its network. On Tuesday, January 26, the federal government gave conditions for an out-of-court settlement which the MTN Nigeria sought after it took the government to court. Adebayo Shittu, minister of communications, said the federal government and the NCC would not settle with MTN Nigeria, until it withdraws the court case it instituted against it.

Answering questions from journalists at the unveiling of the Communications Sector Roadmap for 2016 to 2019 in Abuja, the minister confirmed that MTN had made some moves for settlement after approaching the court for adjudication but said such moves were not acceptable until the case had been withdrawn from the court.

Another condition for an out-of-court settlement with the multinational telecoms operator, according to the minister, is the approval of a possible new deal by President Muhammadu Buhari. “The case is in court. It was MTN who took the government to court because they wanted to, perhaps, buy time or whatever. I don’t want to cast any aspersion. I am aware also that after going to court, they have made certain moves but you know that in matters like this, se the telecom giant nsitive issues are involved.

“As far as we are concerned, there can be no out-of-court settlement except the case is withdrawn from the court so that the government will not be put under pressure. If the case is out of court and if they make further moves, Mr. President may graciously make a decision. But now, I am not aware of any out-of-court settlement talks.”

MTN had on Friday, January 22, said it was considering settling the controversial fine out of court with the regulatory agency. Wole Olanipekun, SAN, counsel to the MTN, had pleaded with Justice Mohammed Idris, presiding judge, to give the parties 60 days to explore the option of settlement out of court.

But Abubakar Malami, attorney general of the federation and minister of justice, who was sued as the second defendant, through Dipo Okpeseyi, his lawyer, told the court that parties had been finding it difficult to settle out of court. He urged the court to take it that all the court papers in the matter had been properly filed and served and that the case was still ongoing. “This is a matter of national importance. There have been concessions in the past and nothing happened,” Okpeseyi said.

In his reaction, Yusuf Alli, SAN, counsel to the NCC, argued that the maximum period allowed by the court rules was 21 days for parties to file and serve written addresses. After entertaining arguments from all parties, Idris adjourned the case to March 18, for report of settlement or for hearing in the case.

The judge also held that all processes filed should be deemed as properly filed and served. He held that all the preliminary objections and substantive application would be taken together on the adjourned date if need be.

Idris, had on January 12, turned down an application of mareva injunction by the AGF seeking to bar the MTN from emptying its accounts in 21 commercial banks in Nigeria, in order not to boycott N1.04tn fine. The AGF had expressed the fear that the MTN could move all its funds out of the country before the N1.04tn fine could be enforced.

He had sought an order directing all the 21 banks to open a special interest-yielding account in the name of the chief registrar of the federal high court and move N1.04tn into it from the MTN’s accounts. But in refusing the application, the judge said the AGF did not place enough material fact before the court to prove that the MTN was making any moves to repatriate all its funds out of Nigeria.

The NCC had fined the MTN a sum of N1.04 trillion for failure to deactivate 5.1 million unregistered subscribers on its network. Though the regulator later reduced the amount to N780 billion, the telecommunications giant went to court to challenge the commission, saying it had no power to penalise it on the matter. The issue caused a lot of upset within the company with the replacement of its chief executive, by the parent company in South Africa, fuelling fears of the sacking of scores of staff members.

The step taken by the regulator also provoked mixed reactions among Nigerians. While some people felt that the fine was outrageous, arguing that it could aggravate the country’s economic problem, if the MTN should decide to exit Nigeria with the attendant loss of direct and indirect jobs.

Apparently in a belated attempt to re-register the subscribers, the MTN has started re-registration of its customers from late last year. But the exercise in itself caused a lot of hardship for subscribers who have had to spend hours in the queue in the course of the re-registration of their sim cards. But the NCC said it was important to have details of subscribers, especially for security reasons.

The commission was particularly angered by the failure of the MTN to comply with its directive to regularise the unregistered lines or deactivate them, because of fears that some unregistered lines could be used for nefarious activities such as kidnapping, terrorism and other crimes.

With the vigour in the current re-registration, it has become obvious that the MTN is still very much interested to continue its business in Nigeria. Getting the matter of fine settled out of court, is expected to consolidate the business interest and also douse the anxiety caused by the face-off between the NCC and telecommunications giant.


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