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Tag: Fine

  • Addax confirms $32m fine payment for Nigerian bribery saga

    Addax Petroleum Limited has confirmed that it has agreed to pay 31 million Swiss francs about $32 million fine in Geneva, Switzerland, to settle charges of alleged bribes given to Nigerian officials.

    Its Public Relations Officer in Geneva, Switzerland, Mr. Douglas Chene-Bougeries confirmed the development yesterday. In a statement, he noted that the Chinese oil firm has agreed to the terms set out in the Geneva Prosecutor’s Office’s order dated July 5, 2017.

    He said: “Relating to case number P/3851/2017, containing the prosecutor’s decision to close the investigation against the company and its employees, following a thorough review of the allegations.

    “Addax Petroleum is committed to conducting its business with the highest level of integrity, and in full compliance with applicable laws, regulations and industry standards.”

    Reuters had on March 24 reported that the Geneva Prosecutor’s Office was investigating the Chief Executive Officer of Addax Petroleum, Geneva operations, Zhang Yi, over allegations of crime in the company’s business in Nigeria.

  • MTN expects loss after Nigeria’s $1b fine

    MTN Group expects to report a full-year loss due to a $1billion regulatory fine in Nigeria and for under-performance both in Nigeria and South Africa, the company said yesterday.

    MTN had agreed in June to pay a N330 billion ($1.05 billion at the time) fine for missing a deadline to cut off unregistered subscriber identity module (SIM) cards from its network.

    Shares in MTN, which fell more than 4 per cent at market open, were 3.82 per cent lower at 113.25 rand at 07:33 a.m., its lowest level since December.

    MTN is the largest mobile phone company in Nigeria, the continent’s biggest economy, and accounts for a third of MTN’s revenue.

    It said the net effect of the Nigerian fine for the year ended December was a negative impact of 474 cents per share.

    MTN will issue a further trading statement on the likely range within which its headline loss is expected.

    Underlying operational results for full-year 2016 were also affected by fees incurred for a planned listing in Nigeria.

    The result also showed MTN under-performance of its units both in Nigeria and in South Africa in the first half of last year.

    MTN said it aims to list its Nigerian operations on the local bourse this year, subject to market conditions.

  • GM to pay $1 million fine for ignition switch case

    General Motors (GM) has reportedly agreed to pay $1 million to the Securities and Exchange Commission (SEC) as part of the settlement for its faulty ignition switch.

    The SEC announced its verdict last Wednesday. The civil penalty of $1 million to be paid by GM will finally settle the ongoing government investigations into the company’s handling of the defect.

    The ignition switch scandal is the result of faulty ignition switches which reportedly shut off the engine during driving and as a result prevented the airbags from inflating.

    The case was first highlighted in February 2014, when GM recalled nearly 800,000 of its small cars due to faulty ignition switches. The number of recalls, however, continued to climb in the following months and nearly 30 million cars were recalled from all over the world.

    Due to the ignition switch flaw, nearly 124 people lost their lives and 275 people ended up being injured.

     

    Prosecution and penalties

    The first major lawsuit was filed on in July 2014 at a U.S. District Court in Manhattan. The lawsuit was filed on the behalf of 658 people who claimed to be severely affected by the ignition scandal. The lawsuit alleged that even if GM was aware of the problematic switches since 2001, it did not take any measures and recall any of the affected cars till 2014.

    Another lawsuit was filed by the Orange County District Attorney on behalf of the people of California when the company failed to disclose its defects. The lawsuit alleged that GM was engaged in unfair competition and cited false advertisements violating the law of California.

  • NERC slams N47.6m fine on TCN over audit report

    NERC slams N47.6m fine on TCN over audit report

    The Transmission Company of Nigeria (TCN) has been fined N47,670,000 by the Nigerian Electricity Regulatory Commission (NERC) over the company’s failure to submit its 2013 and 2014 audited financial statements.

    According to a document with reference number NERC/Directive/160 signed by the acting Chairman, Dr. Anthony Akah, and General Manager, Legal, Licensing and Enforcement, Mrs Olufunke Dinneh, TCN has up to two weeks to pay the fine beginning from December 2  when the Directive was signed. The fine attracts five per cent interest daily after the due date.

    The commission said in a statement that TCN for failure to submit audited financial report has violated “Section 63 (1) of the Electric Power Sector Reform Act, 2005 that stipulates“a licensee shall comply with the provisions of its license, regulations, codes and other requirements issued by NERC from time to time.”

    Other infractions as contained in Directive 160 include Condition 4 and 5 of TCN’s Transmission Licence. Condition 4 stipulates that “Licensee shall furnish to the Commission information, in such a manner and at such times as the Commission may require” at the time and format as may be required by the Commission to perform its regulatory functions.

    Condition 5 of TCN’s licence further directs it to submit audited financial reports to the Commission as detailed in its Transmission Licence.

  • N780b NCC fine: MTN pays N30b

    N780b NCC fine: MTN pays N30b

    MTN yesterday said it has paid N30 billion into the Nigerian Communications Commission (NCC’s) Treasury Single Account (TSA) with the Central Bank of Nigeria (CBN) as part payment of the fine imposed on it by the NCC.

    Last year, a total fine of N1.04trillion was slammed on the telco over subscriber identity module (SIM) card registration infraction concerning some 5.2million improperly registered lines on its network.

    The fine was first reduced to N780billion by the Federal Government but was later reduced to N330 billion. The telco first paid N50billion in ‘good faith’ after withdrawing the court case it instituted gainst the regulator.

    The final resolution of the impasse was that the balance of N280 billion would be paid by the telco in six tranches between this year and May 31, 2019.

    Its CEO, Ferdi Moolman, said: “I am pleased to announce that the first payment of N30 billion in the terms of settlement has already been disbursed to the NCC in addition to the earlier payment of N50 billion which we paid in good faith and without prejudice on February 24, this means we have now paid a total of N80 billion.”

    Meanwhile, after the payment of N18.96billion licence fee for the 2.6 gigahertz (GHz) spectrum to the NCC, MTN said it has obtained the letter of award of the spectrum from the regulator.

    The licence for the spectrum which guarantees superior performance for wireless networks, especially 4G long term evolution (LTE) services, has a 10-year life span.

    MTN was the only telco that participated in the bid that took place last month as other telcos shunned the auction. NCC had earlier confirmed that MTN’s bid was in full compliance with the relevant provisions of the Information Memorandum (IM) for the exercise.

    Although Nigeria is one of 28 African countries that currently offer 4G/LTE services, the rate of penetration is restricted to a few major cities. As such, MTN’s success in this auction is a big boost to its plan to deliver global mobile broadband and LTE 4G services to over 60 million customers in the country.

    MTN also plans to use Frequency Division Duplex (FDD) networks in addition to its existing Worldwide Interoperability for Microwave Access (WIMAX) over time division duplex (TDD) networks, as this provides for greater consistency with existing 2G and 3G deployments.

    “After complying with all the requirements for the 2.6GHz auction and making the licence payment of N18.96 billion to the NCC, MTN has been issued a letter of awar,” Moolman said.

  • Senate and MTN fine

    SIR: I want to thank the Senate of the Federal Republic of Nigeria for taking up the gauntlet on behalf of the Nigerian people to challenge the unilateral decision of the federal government to slash that fine imposed on MTN by the NCC.

    The infraction by the MTN resulted in the deaths of a lot of Nigerians.  Not slashing the fine will not bring back these lives. But we must not promote impunity and executive rascality by making decisions which affect Nigerians, in what looks like dictatorship.

    Let the cut in the fine be cancelled. Let the President constitute a committee involving the executive, the judiciary, and the legislative arms of government together with CSOs, to resolve the matter.

     

    • Bob MajiriOgheneEtemiku

    Benin City.

  • Why MTN’s N1.04tr fine was cut to N330b, by minister

    Why MTN’s N1.04tr fine was cut to N330b, by minister

    The Presidency and the Senate are heading for a showdown over the reduction of the N1.04 trillion fine imposed on MTN Nigeria first to N780 billion and thereafter to N330 billion.

    MTN was fined for failing to meet the deadline fixed by the Nigerian Communication Commission (NCC) to disconnect unregistered subscribers .

    The firm was fined $1,000 per each of its affected 5.2 million subscribers, totalling $5.2 billion

    Minister of Communication Adebayo Shittu explained at the weekend, that the reduction was approved by the Federal Executive Council (FEC) to avoid stifling foreign investments.

    But the Senate has queried the action, alleging that the process was not transparent.

    It summoned the Minister of Communication, the Attorney General of the Federation, the Governor of the Central Bank  of Nigeria (CBN) and the chief executive of the NCC.

    Speaking at the Achiever’s Award ceremony in Ibadan, the Oyo State capital, at the weekend, where the Otun Olubadan of Ibadan, Senator Lekan Balogun, was honoured, Shittu said FEC decided to relax the penalty after realising the negative impact the burden could have on the nation, its people and the economy.

    He said:  “As far as we are concerned, the MTN issue is a closed matter. The Federal Executive Council has remitted substantial part of the penalty to them. Nigeria as a country must move on. We must not do anything to drive away foreign investors. Foreign investments are potent means of bringing about development and wealth creation.

    “Again, we must not forget that before MTN and other telecoms operators came on board, Nigeria had only less than 500,000 telephone lines. Today, because of their involvement, Nigeria now has more than 152 million lines and MTN is the dominant operator in the field. It controls almost 50 per cent of the lines. Though they (MTN) have violated the law and we have put in the necessary penalty, we must put a halt to the limitless crisis so that we don’t discourage foreign investors. That is what the executive has done to ensure we move ahead.

    “We know, for instance, that MTN operates in 22 countries. And that what they make in Nigeria alone is more than what they make in other 21 countries put together,” he said.

    Shittu also advised telecoms operators against taking Nigeria and their customers for granted, warning that all infractions would be appropriately sanctioned.

    “The operators owe a duty to Nigerians to continue to improve on their services. Nigerians have been paying through thick and thin to enjoy and patronise them. To whom much is given, much is expected.”

    The Senate said the transactions were fraught with “suspected criminal tendencies as they were perfected secretly, particularly without recourse to due process”.

    Senate Committee on Communications Chairman Gilbert Nnaji, in a letter titled “Re: Settlement between NCC and MTN over fine”, expressed dismay over how the “settlement agreement of N330 billion was reached with MTN out of a whooping N1.04 trillion”.

    The letter was dated June 15, 2016 and addressed separately to stakeholders, including Minister of Justice and Attorney General of the Federation, Minister of Communications, Executive Vice Chairman/CEO of NCC, Accountant-General of the Federation, Minister of Communications, Managing Director/CEO of MTN and the Governor of the Central Bank of Nigeria.

    He noted: “As a committee and representatives of the Nigerian people, we are saddened about this development at a time when the Nigerian economy needs all the available capital infusion to bolster it.

    “It is our strong opinion that Nigeria has been shortchanged in this whole process on account of the ridiculous settlement payment plan, coupled with the disparity in the exchange rate regime when the fine was imposed ab initio compared with the current prevailing exchange rate when it was agreed to cut the fine to N330 billion.”

    Specifically, Senator Nnaji lamented that “NCC could engage in such a negotiation that is tainted with a lot of questionable conclusions without the knowledge of the Committee”.

    He added that “the Committee is worried about this development because it is on record that during our last investigative meeting with all the relevant parties to this matter on Thursday, March 10, 2016, the Committee was informed that the case was still in court and that it was adjourned till March 18.

    “The Committee was not aware of the outcome of the court case, neither was it privy to any active negotiation that led to the fine being reduced to N330 billion.

    “It is our concern that Nigeria has been shortchanged in this whole process on account of the ridiculous settlement payment plan, coupled with the fact that parties involved in the negotiation were either oblivious of the exchange rate value of the Naira to the Dollar when the sanction was meted originally compared to current exchange rate regime when the value of the Naira is now on the downward slide.”

    “Consequently, you are hereby invited to appear before the Committee to shed more light on the issues surrounding the settlement.

    “You are requested to furnish the Committee with the following information to guide it in its deliberation: Document(s) detailing Presidential Directive to “accede that MTN should pay N330 billion to the Nigerian Government” as contained in paragraph1of your letter.”

    “Document (s) specifying evidence of negotiation such as the terms of negotiation.

    “Parties to the negotiation; modalities for arriving at N330 billion; minutes of negotiation meeting and other relevant information.

    “Relevant section(s) of the NCC Act 2003 that empowers NCC to impose fines accompanied with sections empowering the commission to reduce fines.

    “Detailed reason(s) for the reduction of the fine from N1.04 trillion to N780 billion to N330 billion;

    “Detailed information on the major role(s) being played by Accountant-General of the Federation in the entire negotiation and settlement process.

    “A copy of the settlement agreement and evidence of participation of the Ministry(of Communications) and its major inputs at the negotiation meeting.

    “Evidence of out-of-court settlement between MTN and the Federal Government.

    “Then for “the Governor of CBN as the custodian of the CBN Recovery Account into which the initial N50 billion was lodged and as a principal player in the whole process” he is expected to present to the committee, the “Current position of the Recovery Account”, the memo said.

  • Reps reject MTN’s offer to pay N330bn fine

    The House of Representatives yesterday rejected an agreement reached between the Federal Government and MTN that the telecoms giant should pay a reduced fine of N330 billion ($1.7bn) as against the N1.04 trillion ($5.2bn) originally slammed on it by the Nigerian Communications Commission (NCC)..

    The NCC had on October 20 last year imposed $5.2 billion on the company for allegedly undermining efforts by the Nigerian government to tackle security challenges and the war on terror and allied crimes, as the telecoms operator allegedly refused to deactivate unregistered mobile phone lines on its network.

    Both NCC and MTN had confirmed the development in separate statements yesterday

    The Director of Public Affairs of NCC, Mr Tony Ojobo, said in Abuja that MTN would pay the fine in six tranches over the next three years.

    The amount, according to him, includes the “goodwill” payment of N50 billion earlier made by MTN to the government.

    He said:”The balance of N280 billion will be made in six tranches in the following order:

    “By the terms of agreement, MTN will pay N30 billion into NCC’s Treasury Single Account (TSA) with the Central Bank of Nigeria (CBN) 30 days from the date of the agreement dated June 10, 2016.

    Other dates of payments include:

    • March 31, 2017 – N30 billion;
    • March 31, 2018 – N55 billion;
    • December 31, 2018 – N55 billion;
    • March 31, 2019 – N55 billion and the balance will be on
    • May 31, 2019 – N55 billion.”

    The agreement and resolutions were signed by Executive Vice Chairman (EVC) of NCC, Prof. Umar G. Danbatta; NCC Commission Secretary, Mr. Felix Adeoye; Chief Executive of MTN, Fredinand (Fredi) Moolman and MTN’s Company Secretary, Mrs. Uto Ukpanah, and witnessed by Mr. Tony Ojobo, NCC, Director, Public Affairs; Mr. Usman Malah, Chief of Staff to the EVC, NCC; Ms Helen Obi, Assistant Director, Legal, NCC and Ms. Amina Oyagbola, Corporate Executive, MTN.

    Besides, MTN agreed to :

    • “Tender an apology in line with the apology previously tendered in correspondences relating to this matter to the Government of Nigeria and Nigerians within the one month of the execution of this Agreement;
    • “Subscribe to the voluntary observance of the Code of Corporate Governance for the Telecoms Industry and would ensure compulsory compliance when the said Code is made mandatory for the telecommunications industry; and
    • “Undertake to take immediate steps to ensure the listing of its shares on the Nigerian Stock Exchange as soon as commercially and legally possible after the date of execution of this Settlement Agreement.”

    Both parties agreed that the terms of settlement “cannot be altered, varied, annulled or modified in any respect, except by writing duly executed by both parties; and the terms of settlement constitute all the terms and conditions of the settlement and supersede and replace any previous offers, representations and terms.”

    The fine is the biggest ever in Nigerian business history.

    Danbatta at the signing of the agreement said it was “taken based on professionalism and global best practices, and in line with the NCC core value ‘to be fair, firm and forthright.’”

    He added: “ the Commission has always carried industry and stakeholders along in taking transparent regulatory actions, adding that at no point will the regulator do anything to jeopardize the business health of the entire sector.

    “We were careful not to take decisions that were likely to cripple the business interest of the operators we regulate. Besides, the downturn of the global economy is biting hard on everybody and every sector, so we must therefore be sensitive and flexible in our decisions”

    “This perhaps is one of the attractions of the global communities to the activities of the Commission through multiple awards recently.”

    MTN,in its own statement,undertook to: “subscribe to the voluntary observance of the Code of Corporate Governance for the Telecommunications Industry and will ensure compulsory compliance. The company also undertakes to take immediate steps to ensure listing of its shares on the Nigerian Stock Exchange as soon as is commercially and legally possible.

    “Always ensure full compliance of its license terms and conditions as issued by the NCC.

    MTN Nigeria Chief Executive Officer (CEO) Ferdi Moolman offered the company’s “ most sincere apologies for the series of unfortunate events that led to the imposition of the fine.” He said: “It was of critical importance to reach a solution that would be of universal benefit to all stakeholders given the importance of the ICT industry in Nigeria and its tremendous impact on socio-economic growth. Along with the authorities, we believe that has been achieved.”

    Regarding the company’s undertaking to list, Moolman said “MTN Nigeria is undoubtedly one of Nigeria’s success stories. Broader public participation exemplifies this.”

    The initial fine of N1.04 trillion was first adjusted by 25% to N780 billion.

    MTN deemed the fine inimical to the sustainability of its business and sought judicial determination in December 2015 to protect the extensive local ecosystem, valued and supported by MTN’s business.

    However in February 2016, at the request of the Federal Government, the company announced the withdrawal of its case against NCC and made an initial “goodwill” payment of N50 billion in order to create a conducive atmosphere for further negotiations.

    Commenting on the final resolution of the NCC fine, MTN Group Executive Chairman Phuthuma Nhleko expressed his thanks to the Federal Government of Nigeria for the spirit in which the matter was resolved saying ‘ this is the best outcome for the company, its stakeholders, the Federal Government and the Nigerian people and the relationship between MTN, the Federal Government and the NCC has been restored and strengthened.’’

    Yesterday’s announcement immediately sent shares in the telecoms provider soaring in South Africa.

    The shares surged 18 percent to 146 rand after the announcement in their biggest jump since April 2000. They have shed 22 per cent since the fine was announced.

    A few days before the imposition of the fine, MTN had said its Nigerian operation lost 5.1 million subscriber lines in the month of August to the deactivation of incomplete SIM registrations ordered by NCC.

    This led to MTN cutting its full-year forecast for subscriber numbers.

    Rejecting the deal yesterday, the House of Representatives issued an invitation to the Minister of Communications Adebayo Shittu to come and shed light on it on Monday.

     Moments after news of the deal broke, the Chairman of the House of Representatives Committee on Communications, Mr. Saheed Fijabi, told reporters he did not understand the sudden shift in position by the NNCC on the fine.

    He dismissed the agreement as unacceptable.

    “It came to us as a surprise to hear that MTN is paying N300bn. How can they be paying that amount when the minister told us that everything was stalled pending the outcome of our investigation?” Fijabi asked.

    “As a House, we have opposed the reduction of the fine because there is no provision in the NCC’s Act that the fine can be reduced. In fact, Section 21 of the Act stipulates that even the CEO of a defaulting firm can be made to pay additional fine of over N200,000 on each of the lines.”

    The lawmaker said ordinarily, MTN’s total fine “should be doubled to about N3 trillion and not even the N1.4 trillion they were asked to pay.”

    The committee chair noted that it was wrong to accept a reduction while the House was investigating the ongoing negotiations between the Federal Government and MTN on the fine

  • N1.04trn fine: Reps reject MTN’s N330bn offer

    N1.04trn fine: Reps reject MTN’s N330bn offer

    The House of Representatives Friday rejected the offer of the service provider MTN to pay N330bn instead of the N1.04 trillion it was fined by the Federal Government.

    In a briefing on the issue Friday, the chairman of the House of Representatives Committee on Communications, Hon. Saheed Fijabi said he wondered why the sudden shift in the position of the NCC offer the issue of MTN fine.

    A March 1, 2016 memo from the Nigerian Communications Commissions, and in possession of our correspondent reads: ” The proposal to pay the sum of N300 billion as against the N1.04 trillion (and subsequently reduced to N700 billion by the Federal Government of Nigeria “FGN”) is not supported by any verifiable justification.

    “When considered vis–a – vis the quantum of fine, the present sum is a far cry and there is no verifiable basis for arriving at the new figure.”

    The lawmaker said the offer of $1.7billion (or N330 billion) by MTN, instead of the total fine of $3.9 billion (N1.04 trillion fine by NCC for violation of SIM card registration laws was unacceptable.

    According to him the Minister of Communications, Mr. Adebayo Shittu, has been summoned by the committee to explain the new development on Monday.

    The committee chair noted that it was wrong to accept a reduction while the House was investigating the ongoing negotiations between the Federal Government and MTN on the fine.

    He said:  “It came to us as a surprise to hear that MTN is paying N300bn. How can they be paying that amount when the minister told us that everything was stalled pending the outcome of our investigation?

    “As a House, we have opposed the reduction of the fine because there is no provision in the NCC’s Act that the fine can be reduced. In fact, section 21 of the Act stipulates that even the CEO of a defaulting firm can be made to pay additional fine of over N200, 000 on each of the lines.”

    The lawmaker said ordinarily, MTN’s total fine “should be doubled to about N3 trillion and not even the N1.4 trillion they were asked to pay.”

  • MTN ‘will pay fine’

    The Deputy Chairman of the House of Representatives Committee on Information and Communication Technology (ICT), Alhaji Ahmed Garba Bichi said yesterday that the on-going probe instituted by the House on the N1.04 trillion fine on MTN by the Nigerian Communication Commission (NCC) would not stop the payment of the fine.

    He said the action of the House would rather facilitate consultations which would lead to the payment of the fine.

    He spoke with reporters in Abuja shortly after the opening ceremony of the 2016 Nigeria Internet Governance Forum (NIGF) at the Shehu Musa Yar’Adua Centre.

    His remarks came as the Minister of Comminications Technology, Adebayo Shittu said the Federal Government would leave no stone unturned to ensure the success of e-governance in the country.

    Represented by Mr Tope Fagbenle, he said all hands should be on the deck to develop the nation’s ICT sector, stressing that government would continue to implement policies that would attract investments into the industry.

    However, Alhaji Bichi confirmed that MTN was yet to pay the fine because of on-going investigations on the matter by the lawmakers.