CBN, AGF Sanction: Multiple views trail $10.1billion MTN Fine

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By Bukola Olanrewaju

Mixed reactions continued to trail MTN  $10.1billion Fine as stakeholders in the telecommunications industry have taken turn to express their differences on the sanction.

It is to be recalled that the Central Bank of Nigeria (CBN) has recently slammed a fine of $8.134 billion on MTN Nigeria and four banks for illegal fund repatriation and as such order the fund to be immediately returned to the coffers of the apex bank.

Whilst the office of the Attorney General of the Federation (AGF) after few days also sanction the telecommunication company for the payment of $2 billion in unpaid taxes over a 10-year period, thereby mandating then to pay within 14 working days. The AGF also directed that the payment of the $8.1 billion is to be dealt with through his office rather than as directed by CBN.

The affected telco company however continue to strenuously deny the allegations saying it has always complied with and carried out all its taxes and financial obligations to the Nigerian government, dutifully.

As thereby proceeded to court to fight it, stakeholders have taken turns to express their views, concerns and fear on the issue in relation to the development of the country’s economy and encouraging foreign investment.

Some alleged that MTN Nigeria have been picked upon due to its sheer size and control of the Nigerian telecom market and as such  become target of every available fines and harassments.

Speaking on the issue a lawyer and investment analyst, Chibuike Okeke said “I think regulators are too harsh on companies with the numerous and high amount of fines they impose on MTN, it looks like state sponsored corporate mugging”

“Effective and impartial regulation is good but if this fines continue, it ultimately could end up hurting Nigeria much more in the long term than it does MTN. Foreign investors don’t look favourably on such risk and will think twice about investing in here.” Okeke added

However, the Nigerian Communications Commission, (NCC) Executive Vice Chairman (EVC) of the commission, Prof Umar Danbatta posited that the commission is doing what it can to facilitate an amicable resolution of MTN’s standoff with the tax and finance regulators.

“Nigeria remains an attractive country for investors who crave for adequate Return on Investments (RoIs)”, Danbatta noted.

While the chairman, Association of Licenced Telecoms Operators of Nigeria (ALTON), Engr Gbenga Adebayo said, “the burden of proof that there was an infraction on the MTN financial transactions with the four banks over funds repatriation, lies on the CBN, based on the earlier report on the investigation of MTN by Senate on the same issue, which freed MTN of any complicity.

“MTN has maintained that it got the approval of the CBN for all dividends it had declared in the past, and that the Senate investigation on alleged funds repatriation had since exonerated it from any complicity in illegal funds transfer.

Reacting to the EVC statement, Adebayo stated that Danbatta statement is in order even though the commission ought to have taken a proactive step before MTN went to court.

He therefore urged the commission to step into the matter with same vitality that it did during the time some banks wanted to take over Etisalat now (9Mobile).

According to Adebayo, “the industry does not need this kind of embarrassing scenarios. It does not give the country positive image that can give foreign investors confidence to come; and we need a lot of them if we hope to use technology to achieve economic transformation

“The NCC should have intervened before now but if the EVC is promising to intervene in the matter, it is a step in the right direction. Nigeria cannot afford to lose face in the international community for issues that can be perceived as double standard. Litigations in the telecom sector does not give impression of a stable industry and investors always loathe that. Seeking out of court settlement would be the best for everybody and the Nigerian economy too”he added

On his part, the President of the Association of Telecommunication Companies of Nigeria (ATCON), Mr Olushola Teniola motioned that

the CBN has no powers to order MTN Nigeria to refund the money.

According to him, ATCON said that the cash in question belongs to MTN in the first place and wondered what the CBN wants to achieve by its order.

He said: “A refund is very unlikely. The size of the demand and timing is unreasonable and not in the interest of the country. After all, the Naira equivalent will have to be returned to MTN Nigeria. It is then an interesting situation that this seeks to redress events that occurred when CBN had full oversight and approved the transactions. How do they intend to do that?” Teniola questioned.

However MTN boss and its head of corporate communication have decided to keep mum as the matter has been transferred to the court for redressing.

Commenting on the sanction, it was reported that the Chairman,  NCC Board of Commissioners, Senator Olabiyi Durojaiye has said the Federal Government wasn’t trying to send the South African telecom operator away from the country, but ‘the telco company should play the game by the rules.

“We do not want MTN to die or leave our country. We want them and we do not have any problem with them; but we believe they must play by all our rules and regulations.

“What is playing out is being settled and we shall get to the root soon,”  Durojaiye noted

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