Editorial: Revisiting the MTN Fine Saga

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It is just as well that South African telecoms giant MTN has paid nearly $100 million of the $1.7 billion fine for failing to disconnect unregistered SIM cards in Nigeria. Tony Ojobo, spokesman for the Nigeria Communication Commission (NCC), disclosed Friday that MTN has already paid N80 billion of the total fine of N330 billion. Ojobo said the payments were based on the schedule agreed by the two parties. MTN was initially hit with a $5.2 billion fine in October 2015 for failing to cut off 5.1 million unregistered SIM cards as requested by the Nigerian government. In December 2015, the fine was cut to $3.4 billion, and then further reduced in June last year to $1.7 billion (N330 billion). It is regrettable that, for motives unclear, a straightforward matter that could have proven the effectiveness of the NCC as a regulatory authority and the firmness of the government to enforce the rules no matter whose ox is gored was messed up by government bureaucrats.

The Johannesburg-based firm, which is the largest mobile provider in Nigeria, threatened to pull out of the country during the SIM card row, until the fine was reduced, thanks to the personal intervention of President Buhari, who more or less directed government agencies to reduce what was considered a very steep fine and give MTN time to pay gradually. The result was the reduced $1.7 billion fine staggered over three years. Predictably, the reduced fine and the manner it was negotiated attracted a hailstorm of public condemnation. The Senate Committee on Communication condemned the negotiating process by which it said MTN flexed its muscle and imposed its will on the country.

The question must therefore be asked: why did the Attorney-General of the Federation, Abubakar Malami, and the Ministry of Communication enter into negotiations with MTN without the knowledge of NCC which imposed the initial $5.2 billion fine; and whose advice ought to have guided any such negotiations? Against the backdrop of speculation of collusion between MTN and some public officials, it must be emphasized that mutual respect and international best practices must begin to define the conduct of business in Nigeria.

The presidency defended Buhari’s intervention, arguing that it was not so much the money from the fine, hefty as it may have appeared, but that the concern of government was basically on the security of Nigerians. Security was cited over fears that Boko Haram terrorists were using unregistered SIM cards to plan and execute attacks, which have left at least 20,000 dead and displaced over 2.6 million from their homes since 2009. Security of life and property is the primary duty of, and key constitutional purpose of government. It is this sacrosanct duty that the government accused MTN of putting at risk. Of course, no responsible government would tolerate that. Still, the question remains: Why involve the president at all in a matter that was purely of regulation and of law? Certainly, this does not reflect the “change” for which Nigerians voted Buhari and his party into power.

Undoubtedly, no one can take away the good that MTN has done to, and for Nigeria. Since it began operations in August 2011, it has added value to itself and to Nigeria in immeasurable material and non-tangible ways. In the telecommunications sector in Nigeria, MTN is a leader by subscriber base, by earnings and by taxable profit. Of course, it has earned billions for its shareholders, created an enviable niche as a pioneer and leading telecommunications company; and has directly and indirectly created jobs for Nigerians and pays taxes in billions of naira to the government. It has imparted skills to its employees, funded projects all over the country to the tune of billions in areas of education, health, skill acquisition and economic empowerment. It has also strengthened the career of several artists; in addition to remunerating the MTN ambassadors. And MTN has engaged in, and continues to undertake numerous other corporate social responsibility activities worth billions; which impact the lives of Nigerians. So, this country cannot seek the ruin of such a responsible corporation.

But these cannot be an excuse to flout the laws of Nigeria and put at risk the lives of the very customers who, in the words of its mission statement, MTN seeks to make “a whole lot brighter.” Besides, other operators complied with the NCC edict that MTN was held in contempt. Sanctions needed to be meted out and it was not arbitrary. The NCC did its duty correctly until typical opacity and tardiness; some have even suggested collusion by top government officials hijacked and torpedo the process.

Now that the issue seems to have been resolved, it is hoped that the right lessons have been learnt; especially that everyone must play by the rules or face the consequences. MTN and other foreign businesses operating in Nigeria need Nigeria just as Nigeria needs them. But, it can never be emphasized enough that, a Nigeria of clean government, functional system, and efficient operating environment will further the interest of business better than a dysfunctional and corrupt nation. It is therefore in the overall long term strategic interests of the business sector to avoid cutting corners and play by the rules all the time.