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MTN agrees to pay $1.7bn fine in 3 years


South African telecoms giant MTN said
Friday it would pay a $1.7 billion fine to the
Nigerian government in a "full and final
settlement" over its failure to disconnect
unregistered mobile phone users.
The Johannesburg-based company said in a
statement that "MTN Nigeria has agreed to
pay a total cash amount of Naira 330 billion
over three years."
Africa's biggest wireless operator was fined
$3.9 billion last year and has since been in
negotiations with the Nigerian government
over the size of the penalty.
The company was hit with the huge demand
amid fears that some of the 5.1 million
affected lines were being used by Boko
Haram insurgents.
After the settlement was announced, MTN
shares rose 10 percent, on track for their
biggest gain since 2008, on the
Johannesburg Stock Exchange, according to
Bloomberg News.
The Nigerian Communications Commission
(NCC), the country's telecoms regulator,
handed down the fine last year citing an
inability to trace users in a country plagued
by frequent kidnappings and Boko Haram
militants.
"MTN is pleased to inform shareholders that
the matter has been resolved with the
Federal Government of Nigeria," the
company statement said.
MTN executive chairman Phuthuma Nhleko
"expresses his thanks and gratitude to (the
government) for the spirit in which the
matter was resolved," it added.
MTN paid one instalment in February and
has scheduled six other payments to cover
the sum by May 2019.
"The concern of the federal government was
basically on the security, not the fine
imposed on the MTN," President
Muhammadu Buhari said in March.
"You know how the unregistered GSM
(Global System for Mobile communication)
are being used by terrorists," he said.
"That was why NCC (Nigerian
Communications Commission) asked the
MTN, Glo and the rest of them to register
GSM.
"Unfortunately MTN was very slow and
contributed to the casualties."
Boko Haram violence has left at least
17,000 dead and forced more than 2.6
million from their homes since 2009. Buhari
announced in December the group was
"technically" defeated but attacks continue.
The MTN fine dominated South Africa's
President Jacob Zuma visit to Nigeria earlier
this year.
Relations between the continent's two
economic powerhouses have been strained
over recent years on issues including
economic rivalry and political friction.
South Africa's growth has been undermined
by the slowdown in China and falling
commodity prices, while Nigeria, the
continent's top oil producer, has suffered
from low oil prices.
The Nigerian government made no
immediate comment on the MTN statement.
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