Since October last year, MTN and the Nigerian government have been involved in a bitter spat after the company was fined N1.04tn ($5.2bn) by the NCC for non-compliance with a deadline to disconnect all non-registered Sim cards. However, the fine was reviewed downwards by 25% with a fresh payment deadline of December 31, 2015 after appeals by the company.
Hoping to get the fine reduced further, MTN has recruited Mr Holder and expect him to begin negotiations with the Nigerian government. MTN had approached the Federal High Court in Lagos a few days to the payment deadline of August, challenging the legality of the fine and by the time the matter came up for hearing, it asked for an out-of-court settlement and requested a 60-day window to sort things out with the NCC.
At the hearing, the court obliged MTN in part, adjourning the matter till March 28 this year and the company is hoping that before then, Mr Holder would have reached a deal with the government. According to MTN, the fine represents 95% of its annual Nigerian turnover, so it is desperate to secure a reduction.
Mr Holder was one of President Barack Obama’s longest serving cabinet members, holding office from 2009 to 2015 before returning to Washington-based corporate law firm Covington and Burling after standing down as attorney-general in April 2015. He has presided over some of the biggest corporate settlements in US history, including the $13bn that JPMorgan Chase paid over the sale of mortgage-backed securities before the financial crisis and BP’s $18bn fine for the Horizon oil spill.
Apparently, Mr Holder has already started work with an initial visit to Abuja last month to plead with senior government officials on behalf of the telecoms company. However, he did not find favour with the regulatory authority, as NCC officials told him that the fine was computed strictly according to the regulations set out in 2011.
MTN's appeals have been falling on deaf ears lately because according to the NCC, the telecom company had acted in contempt of the regulatory authority’s several warnings about the dire consequence of its failure to disconnect unregistered Sims by the August 25, 2015 deadline. NCC sources also said MTN failed to respond to warnings about how unregistered Sim cards were used by criminals and Boko Haram terrorists to evade surveillance.
Security chiefs had been particularly incensed when a terrorist commander was captured with dozens of MTN Sim cards after the deadline set last August for all telecom groups to disconnect unregistered subscribers. Professor Umar Danbatta, the NCC's vice chairman, allayed fears that the fine was so punitive that it would scare away foreign investors, adding that it was open to favourable review.
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