MTN Nigeria has urged the Federal High Court, Lagos to quash the $3.9 billion sanction imposed on it by the Nigerian Communications Commission (NCC).
The action came as a lawyer, Abubakar Sani, in a separate suit, also asked a Federal High Court, Abuja to declare the fine unlawful. NCC had in October sanctioned the company for allegedly failing to disconnect unregistered subscribers. The initial fine of $5.2 billion was reduced by 25 per cent to $3.9 billion earlier this month, with a December 31 payment deadline.
But MTN, through its lawyers led by a former Nigerian Bar Association (NBA) President Chief Wole Olanipekun (SAN), is challenging NCC’s powers to impose the fine. It argued that NCC, being a regulator, could not assume all the functions of the state. MTN said the commission could not make the regulation, prescribe the penalty and impose the fine payable to it and not to the Federal Government.
The firm alleged that it was not afforded its constitutional right to fair hearing before a court of competent jurisdiction.
Besides, MTN said it had not been found guilty of any offence that would warrant it to pay such a fine. It contended that the sanction imposed on it by NCC was within 24 hours of its written submission on the disconnection exercise and the impractical nature of the NCC deadline.
According to MTN, the deadline of seven days to disconnect 5.2 million subscribers was grossly inadequate and impracticable. The telecoms company said the deadline was unfair and ran contrary to the requirement to give adequate notice to the subscribers to update their records. It accused the regulatory agency of acting as a legislator, executor, accuser, prosecutor, judge and beneficiary of the penalty.
MTN said NCC’s N200,000 per SIM sanction was excessive, being the highest fine ever imposed on a telecommunications company in the world. The company wondered if the fine is truly commensurate with the purported breach and if it would not frustrate its business in Nigeria.
Attorney-General of the Federation (AGF) Abubakar Malami (SAN) is also a defendant in the action.
MTN urged the court to determine whether having regard to Sections 1 (3), 4 and 6 of the 1999 Constitution (as amended), the regulatory agency can validly enforce Section 70 of the NCC Act in a manner that encroaches on the exclusive legislative powers of the National Assembly, as well as the judicial powers of the courts established under the Constitution.
It said having regard to the express tenor of sections 1 (2), 4 and 6 of the Constitution when read together with Section 70 of the NCC Act, whether the commission’s promulgation of regulations 11, 19 and 20 of its Act (Registration of Telephone Subscribers) Regulations 2011 is not ultra vires its subsidiary rule-making powers.
It also wants the court to determine whether the regulations did not amount to an encroachment on the National Assembly’s legislative powers, as well as the courts’ judicial powers.
Sani, in his suit, among others, argued that it was illegal for NCC to impose a fine of N200,000 per contravention on any of the four mobile telecommunication companies operating in the country for any breach of its regulations. The suit has as defendants NCC, MTN, Emerging Markets Telecommunications Services Limited (Etisalat Nigeria Limited), Globacom Limited and Airtel Networks Limited.
He urged the court to order NCC to give account of and refund the money it had collected from the four telecommunication companies as fines/penalties in excess of the N100 per contravention for any alleged contravention of the NCC (Regulation of Telephone Subscribers) Regulations 2011.
Sani, in a supporting affidavit, stated that the NCC had on two occasions imposed fines on the four mobile telecommunication companies for contravening some provisions of the Regulations 2011, under which it imposes N200,000 per contravention.
He gave an instance in April 2013 when the telecommunication companies were made to pay a cumulative fine of N53.8 million (MTN, N29.2 million; Etisalat, N5 million; Globacom, N11 million and Airtel, N8.6 million). He also cited the N1.04 trillion fine NCC imposed on MTN for allegedly refusing to deactivate 5.2 million unregistered/irregularly registered subscribers.
Relying on Section 12(1)(c)(ii) of the Interpretation Act, Sani argued that the NCC Regulations 2011, being a subsidiary legislation, enacted by the NCC pursuant to Section 70(1) of the Nigerian Communications Act 2003, cannot empower NCC to impose fines in excess of N100.