NCC slashes MTN’s $5.2B fine - then raises it again

The Nigerian Communications Commission (NCC) has cut MTN’s $5.2B fine by 25%, reneging on its initial offer to lower the penalty by a third.

On December 2, the regulator informed MTN that it would reduce the fine to $3.4 billion, but just one day later has revised the amount to $3.9 billion. The NCC has not explained how it calculated either amount, or why it chose to retract its initial offer, but has maintained the original deadline of 31st December 2015.

MTN incurred the fine by failing to disconnect 5.1 million unregistered SIMs, which violated measures imposed by the NCC aimed verifying subscriber identities to combat terrorism. Thus far, 3 senior executives have resigned from the South African operator, including group president and CEO Sifiso Dabengwa, MTN Nigeria CEO Michael Ikpoki, and head of regulatory and corporate affairs Akinwale Goodluck.

Negotiations are being conducted by the group’s former CEO Phutuma Nhleko, now acting as executive chairman. Nhleko has noted that the firm is “carefully considering” the NCC’s letters and will “immediately and urgently re-engage” with the NCC “before making a formal response.” Reuters has reported that “the fine is still big enough to cripple MTN’s ability to invest in its network and that’s what further talks with the NCC are about.”

MTN has stated: “It is essential for the company to follow due process to ensure the best outcome for the company, its stakeholders and the Nigerian authorities, and accordingly all factors having a bearing on the situation will be thoroughly and carefully considered before the company arrives at a final decision.”

The group has revised its operating structure in the wake of the fine, dividing into 3 regions: West and Central Africa (WECA), South and East Africa (SEA) and Middle East and North Africa (MENA). Chief technology and information officer Jyoti Desai has taken the role of CEO, but this is not a final appointment as MTN has stated that replacing Dabengwa is a priority.

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