A Lagos judge has adjourned a hearing in an $8.1 billion dispute between telecoms firm MTN and the Central Bank of Nigeria until 12 December, after lawyers said they wanted to report back on settlement talks.
The apex bank is demanding that MTN repatriate $8.1 billion to the country. MTN and the central bank have been in a dispute since August over the transfer of the funds, which the bank said the company had sent abroad in breach of foreign exchange regulations, which MTN has denied.
Lawyers for both parties told the court they were in talks to agree to a settlement.
Meanwhile yesterday Reuters reported that a Lagos court hearing concerning a dispute between MTN and Nigeria’s attorney general over a $2 billion tax demand will only take place on 7 February 2019.
MTN faces the $2 billion tax demand from the country’s attorney general, a claim which the company has said is without merit. A judge was scheduled to hear the case on Monday but a registrar said the court would not sit and the hearing had been moved to February.
Chasing Investors away
There are already fears that the action of the Nigerian government may just be chasing away investors away, particularly in a sector like telecoms that is in dire need of FDI.
“Nigeria is currently facing tough economic conditions and its perceived attack on large foreign-owned companies such as MTN, by imposing hefty sanctions, may be seen by potential investors as an attempt by government to cushion the impact of these tough economic conditions, by targeting healthy revenues generated by multinationals that are flourishing in that market,” said Ofentse Dazela, director of pricing research at Africa Analysis.
He said while companies in all markets are subject to rules and regulations, the noise coming from Nigeria around compliance is now a cause for concern for stakeholders with vested interests in that market.
This is not the first time MTN has been in hot water in Nigeria. It was hit with a $5.2 billion (R71 billion at the time) fine from the Nigerian Communications Commission (NCC) in October 2015. This after the telco failed to meet a deadline to disconnect 5.1 million unregistered SIM cards on its Nigerian network.