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.
As a result of the fine, MTN shares plummeted about 20 percent this week in Johannesburg. The biggest four-day drop since 2008, valuing the company at about 284 billion rand ($21 billion).
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. Click to signup for FREE news updates, latest information and hottest gists everyday
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It serves them very right.Flagrant violation of process and procedures.
ReplyDeleteReally serves them right. If it were a Nigerian company in South Africa they will do the same or even more than that.
DeleteThe penalty is fair. Some of your customers who were criminals could not be traced even when they were sending texts to threaten people. Boko Haram also had a field day.
ReplyDeletePay your fine
Who are those financial analyst that have not deemed it fit to first evalute the fraud on customers and staff of the company by its top managers for almost 14years if not more? Capped with their sarcastic comment during the xenophobia issue in SA. I am sure that what they do in Nigeria cannot be dreamt of in other countries talk less of practicing them. Pls let them dor once bear the pain ppl around themhave been feeling for so long
ReplyDeleteI know that MTN has violated the rules. However, there is no need to use a hammer to kill a fly. While the fly dies, other major damages would result.
ReplyDeleteNCC should exercise caution and restraint quickly.
Nigeria or any other country need foreign investors.
Nigeria is a dead country. Both the regulators, govt and MTN are all lawless and unfocused
ReplyDelete1.4Trillion can not pay for Olu Falaye's life if is to say he is killed. Today you still can get over 1million mtn sims not duly registered. To me the fine is very ok cos they are the same kinds of lines they used (kidnerpers).
ReplyDeleteThe US slams fines on large corporations who violate US laws and they are still operating in the US. Whether anyone likes it or not, Nigeria is a huge potential for investments. So if MTN wants to run because they simply cannot adhere to rules they are a signatory of, then they can leave and allow someone else take their space. There is so many waiting out there to have their slot.
ReplyDelete