Nigeria will await MTN's court case before deciding on $3.9bln fine -ministry - CNBC Africa

Nigeria will await MTN's court case before deciding on $3.9bln fine -ministry

Western Africa

by Felix Onuah and Camillus Eboh 0

A date has been set for MTN to pay its $3.9bn fine which it plans to fight in court. Photo: Reuters:

ABUJA (Reuters) - Nigerian authorities will wait for the outcome of a court challenge filed by South African telecoms firm MTN before deciding on whether to enforce a $3.9 billion fine, a spokesman for the telecommunications ministry said.

The ministry spokesman contradicted a source in the Nigerian Communications Commission (NCC), who earlier said "appropriate action" would be taken against MTN if it failed to pay the fine by a Dec. 31 deadline for failing to disconnect users with unregistered SIM cards.

Nigeria has been trying to halt the widespread use of unregistered SIM cards amid worries these are being used for criminal activity, including by the militant Islamist group Boko Haram.

The NCC slapped a $5.2 billion fine on MTN in October but after weeks of negotiations reduced it by 25 percent this month, setting a deadline for Dec. 31.

However, the operator was still not prepared to pay the reduced fine and said last week it would challenge the penalty in a Lagos court.

"The federal government, NCC (regulator) or any government agent will not do anything at the expiration of the Dec 31 deadline," said Victor Oluwadamilare, the ministry's media assistant.

"Now that they (MTN) have gone to court we will await the outcome of the case," he added. "This is a government that believes in the rule of law."

The ministry appears to have taken a softer stance than the regulator on the dispute. The minister Adebayo Shittu told Reuters last month the West African nation did not want MTN to "to die" from the fine.

Shares in MTN, down about 25 percent since the fine was announced in October, were little changed at 141 rand by 1028 GMT.

MTN spokesman Chris Maroleng declined to comment.

The move against MTN came months after Muhammadu Buhari became president of Africa's biggest economy, promising tougher regulation and a fight against corruption.

Other telecoms firms operating in Nigeria disconnected unregistered users within the deadlines set by the authorities.

Some analysts have said the size of the fine imposed by MTN risked damaging Nigeria's efforts to shake off its image as a risky frontier market, but others said it showed Abuja was keen to enforce the law.

(Additional reporting by Tiisetso Motsoeneng in Johannesburg; Writing by Ulf Laessing, editing by William Hardy/Raissa Kasolowsky)