EVENTS surrounding the fine imposed by the Nigerian Communications Commission (NCC) on a telecommunications company, MTN, over failure by the latter to deactivate unregistered SIM cards at the expiration of the stipulated deadline and eventual recourse by MTN to seek legal redress, without doubt, will go down in history as one of the biggest face-offs between a regulator and an operator in the country.
On October 22, 2015 the NCC imposed a fine of $5.2 billion (N1.04trn) on MTN for allegedly violating its directive on the 5.2 million subscribers with unregistered SIMs and incomplete registration details on its network.
Worried by the need to check crime, such as kidnappings and activities of insurgents, the National Security Adviser’s (NSA) office had on May 1, 2010, in collaboration with other security agencies and the NCC, mandated telecoms operators to start collecting biometric personal information of their subscribers.
In March 2011, the sum of N6.1 billion from the Federal Government was granted NCC before flagging-off the process and six months period was given to the operators to comply.
NCC had recruited seven consultants; SW Global; PNN; Chams; JKK; DatagroupIT; Eagle/CBC and E-Kenneth/SageMetrics to carry out the SIM card registration exercise. However, because they did not have a synchronized software solution that could detect double registration, the contracts were revoked.
On November 7, 2011, the SIM Registration Regulations came into force. SIM Card Registration Code, Section 19 to 21, stipulates a fine of N200, 000 to a telecoms company for failure to deactivate any SIM Card without proper registration details. And following the expiration of an initial grace period, the NCC mandated all operators to deactivate all unregistered existing SIM cards on their networks by the 30th of June 2013. By November of the same year, telecoms operators were directed to fully bar any newly-registered SIM card which failed to perform a voice or data communication within 48 hours after its registration.
In September 2014, the NCC shared with the operators, details of registration records that the commission judged as invalid on its system, directing them to clean up their records through deactivation within 30 days Again, on 8th July 2015, NCC directed operators to deactivate all the SIM cards registered but without a record of activity within 21 days.
On 4th August, 2015, the operators, representatives of the security agencies and the NCC held a meeting to discuss issues around SIM registration and how it had become a serious threat to national security. At the end of the meeting, a final directive was issued to the telecoms operators to deactivate all SIM cards with improper/invalid registration details by 11th August 2015.
According to the Head of Enforcement and Monitory Department of NCC, Idehen Efosa, in September 2014, NCC discovered that from the SIM data the operators sent to the commission for harmonization, some of them were defective and had to be returned to the operators for proper checks.
Efosa said about 18.6 million SIM data were sent back to MTN Nigeria; 7.49 million to Airtel; 2.23 million to Globacom and 10.46 million to Etisalat.
Idehen, however, said the monitoring exercise done recently by the NCC showed that operators only showed partial commitment to the exercise.
According to him, out of the about 18.6 million SIM registration data found to be defective on MTN network, only about 1.6 million had been barred. He explained that what MTN did was to put the affected subscribers on “Receive Calls Only,” which means the subscribers cannot put a call through to another network.
“During our visit to Airtel, the telecommunications service provider had fully barred 2.3 million from its network. These were SIM data found to be incomplete. At Globacom, 3.5 million lines were barred also from its network, although with assurance that others lines found to be defective on their networks would be deactivated in 24 hours.
“Etisalat barred 3.3 million and promised that within 24 hours, others found to be challenging will be removed totally from the networks,” he hadstated.
It is to be noted that as a result of this, the CEO, Mr. Sifiso Dabengwa, led a team from South Africa, to engage with the Federal Government. Dabengwa, who had served as CEO of MTN Nigeria between 2004 and 2006, met with the NCC Executive Vice Chairman, Umaru Garba Danbatta, Secretary to the Government of the Federation, Mr. Babachir David Lawal, Inspector General of Police, Mr Solomon Arase, Director General of the State Security Service, Mr Lawal Musa Daura, National Security Adviser (NSA), Major-General Babagana Monguno (rtd.) and Chief of Staff to the President, Mallam Abba Kyari.
This, as well as other diplomatic consultations eventually led to a 25 per cent reduction in the fine. What the developments suggested was that MTN, as a responsible corporate citizen, was ready to cooperate with Nigerian authorities with a view to finding an amicable solution to the face-off.
However, the decision by MTN to proceed to court to challenge the propriety or otherwise of the fine, came to not a few by surprise given that already the operator was beginning to win some public sympathy on account of the weight of the fine.
Much as we respect the decision of MTN, we still feel that the fact that it remains the only defaulter, speaks volume of the disdain with which the operator holds the nation. This is particularly worrisome, given the fact that in South Africa, every intending subscriber is made to register the SIM immediately at the point of purchase. Why, therefore, should this be an issue for MTN if it had any modicum of regard for Nigerians who wholeheartedly received it when it landed on the shores of the nation? This is in spite of the fact that it is an open secret that the South African business environment has been openly aggressive and hostile to both ordinary Nigerians and businessmen from here.
It is also worrisome to note the present harrowing experience subscribers have been going through to register SIM cards which many of them have as much as registered over five times. This is completely avoidable, if ab initio, MTN had attached any seriousness to this otherwise basic exercise.
It is not in the interest of the operators to engage the regulator of a sector of the economy where it generates more than 30 per cent of its total global revenues, in avoidable controversy.
We commend the NCC and call on all other regulators in the economy to ensure adequate supervision and regulation of their sectors. Now that sanctions have been imposed, it is left to both parties to find a workable way of resolving the imbroglio.
We believe that valuable lessons will have been learnt from this so that in future, any intending investor will realize that the era of impunity where anything goes is over and that not only can the regulators bark but they can as well bite when push comes to shove.