What was the fine for?
Well, it was about the deactivation of unregistered SIMs. NCC said MTN failed to deactivate 5.1 subscribers before the deadline passed. And according to the NCC 2011 Act there is a fine of N200,000 per subscriber line that should be deactivated that wasn't.
So legally, the fine wasn't arbitrary and the rules had been made clear long ago.
So what is MTN saying?
MTN said it deactivated the lines but couldn't get it done within the short time window NCC gave and that it had explained to NCC before the deadline passed that it can only do a staggered deactivation over a month and not the 7 days NCC required.
So what do I think?
My thoughts are based on the following:
- MTN definitely can't afford to pay that huge fine. Our entire national budget is N4.493 trillion and we want to get one company to squeeze out N1.04 trillion. That's almost a quarter of our national budget. And as usual if we get it, we'll be sure to squander it rather than create economic value which the unwilling donor had been doing.
- Our international risk rate has just gone up. Our companies will find it hard accessing global investor funds and our big companies will now be faced with a higher rate international loans/bonds. We are slowly going back to how our economy was perceived during the military era.
- The simultaneous hammering of Stanbic IBTC (another South African company) isn't helping matters too. Multichoice is probably expecting it would soon be accused of some random offence and hammered too. As much as we would like to see companies acting too big to be brought low, we might be doing more economic harm if we have one standard for the private sector and another for the public sector. If we can't prosecute the ones looting our treasury and are unsympathetic in killing the ones creating jobs for the masses, then we are doing ourselves more harm. The countries that levy this type of fine would have put many people in jail for the running to ground of NITEL.