Update on N1.04 Trillion Fine: NCC Suspends Regulatory Services To MTN
The Nigeria Communications Commission (NCC) has suspended all regulatory services to MTN Nigeria until its pays the N1.04 trillion ($5.2bn) fine for flouting its directive to deactivate 5.2 million incomplete subscriber identification module (SIM) cards on its network,
Consequently, the share price of MTN Group reacted failing by 12 per cent yesterday.
We had yesterday reported that NCC fined MTN Nigeria N1.04 trillion ($5.2bn) for not deactivating incomplete SIM cards on its network.
We also confirm that Nigeria’s largest mobile operator with headquarters in South Africa is in for more trouble for 28 accumulated breaches.
According to an NCC document exclusively cited by LEADERSHIP which catalogued MTN’s numerous infractions, the regulator decided to wield the big stick to beat MTN into line.
“In the NCC quarterly compliance enforcement report for Q2 2015, out of the six sanctions imposed on operators for various acts on non-compliance, MTN was involved and sanctioned for four separate infractions,” the NCC document stated.
“As it stands today, MTN’s persistent violations have forced the NCC to impose the unprecedented sanction of suspending all regulatory services to MTN following its accumulation of over 28 separate and proven infractions.”
NCC also said MTN’s dominance places limitations on the federal government’s power.
MTN currently has 59.3 million active subscribers, the largest fibre-optic and microwave backbones and the largest data centre in sub-Saharan Africa and uses over 9,000 mobile towers for its operations.
“MTN’s dominant position in the mobile telecommunications market is so strong that the other telecommunications operators in combination cannot provide sufficient capacity to cover for MTN’s traffic if for security or other reasons the government needed to impose ultimate sanctions. This situation may further embolden MTN to not comply with the law in a timely fashion,” the regulator said.
On Thursday, October 22, 2015, NCC reviewed the registration records of all the telecom operators, took into consideration their compliance records, and imposed a fine on MTN alone for noncompliance on SIM registration.
“The fine of N1,040 billion is in line with Section 19 of the SIM Registration Regulations specifying N200,000 per unregistered SIM and the penalty has been applied for the 5.2million MTN SIM card registration records found to be non-compliant by the NCC.
“This unprecedented fine is indicative of the magnitude of the transgression and the seriousness with which the NCC and the authorities are approaching this issue. It is also more likely to ensure that the willful non-compliance by MTN ceases,” NCC stated in the document.
MTN’s infractions, according to NCC, shows that the operator failed to comply with the directive of the NCC and security agencies to deactivate improperly registered subscribers within the seven-day deadline ending on August 11, 2015. Following repeated warnings and compliance enforcement visits as detailed above, MTN only made a partial attempt to bar unregistered subscribers in selected areas over a few days in September 2015.
“Other operators had fully complied and reconciled their deactivations with the invalid registrations shared by the NCC up to four weeks earlier. The consequence of MTN’s refusal to comply with the directive is even more pronounced as about a half of all the invalid registrations shared by the NCC belonged to MTN.
“These SIM cards with invalid registrations pose a grave security risk to the country as their registration information cannot be used to successfully identify their owners in the event of a security issue involving any of these SIM cards. The recent kidnapping of the former finance minister, Chief Olu Falae, is one example of this risk: the kidnappers used MTN SIM cards and MTN was unable to provide any registration data for those SIMs,” NCC explained.
NCC stated that “MTN’s non-compliance with the deactivation directive is unfortunately not an isolated incident. It needs to be seen in the context of a general pattern of non-compliance, with regulatory directives that actually predates the current SIM registration infractions.”