NCC Fine: Court prevents MTN from repatriating funds abroad

A Federal High Court in Lagos on Tuesday said MTNNigeria Communications Limited could no longer move any funds from all banks in Nigeria abroad pending hearing of its suit challenging the N1.4trillion fine imposed on it by the Nigerian Communication Commission (NCC).

Justice Mohammed Idris ordered parties to maintain the statusquo.“ An order is hereby made directing the parties cited herein to maintain the status quo ante bellum pending further hearing,” the judge said.

Status quo ante bellum is Latin for “the way things were before”. In law, it refers to a temporary restraining order in which a situation is restored to “the state in which it previously” existed.

The Federal Government had, through a motion ex-parte, sought an order of mareva injunction restraining the 21 commercial banks from releasing any funds belonging to MTN. It sought “an order of mareva injunction restraining the aforementioned banks from releasing, further releasing any funds, making sale, transferor payment of any monies or dealing in any manner whatsoever with any and all monies maintained by the plaintiff/respondent (MTN) or its agents, privies,subsidiaries, sister companies or the like in the aforestated banks that will alter, decline or reduce the amount of the first defendant’s/applicant’s fine against the plaintiff/respondent in the sum of N1,040,000,000,000 which has remained wholly unsatisfied, pending the determination of the motion on notice.”

MTN is urging the court to quash the sanction imposed on it by NCC in October for failing to disconnect unregistered subscribers.

The initial fine of $5.2billion was reduced by 25 per cent to $3.9billion last December.

MTN sued NCC and the Attorney-General of the Federation, Abubakar Malami (SAN), contending that NCC, being a regulator cannot assume all thefunctions of the state.

The AGF, while envisaging that MTN could move all its funds out of the country before the N1.04tn fine could be paid, sought an order directing the banks to open a special interest-yielding
account in the name of the chief Registrar of the Federal High Court.

Malami prayed that the N1.04tn be kept with the court’s chief Registrar as trustee, and for MTN to file an affidavit within seven days of being served with the processes.The judge, however, ordered that status quo be maintained, adding: “The parties herein are to be served with the processes in this matter.”

The AGF, in a supporting affidavit deposed to by Steve Nwabueze, argued that MTN was in the habit of regularly repatriating its funds out of Nigeria. According to him, between October 2007 and May 2009, MTN moved over $7.7billion to a foreign account. Specifically, he said MTN, on February 8, 2008, transferred over $936million to accounts in Mauritius, Cayman Island and British Virgin Island.

The deponent said MTN was obliged to pay the fine unless it was reviewed by the commission or nullified by the court. “Unless this honourable court urgently entertains this application, the plaintiff/respondent would move its funds out of Nigeria,being the jurisdiction of this honourable court, and thereby frustrate the enforcement of the fine in the likely event that this honourable court sanctions the imposition of the fine,” the AGF said.

He said NCC had earlier given MTN a concession on the fine and reduced it to N780billion, yet MTN refused to pay on or before last December 31.

Malami said instead of MTN to take advantage of the concession and settle the fine, it chose to sue in a bid to buy time and avoid the payment.
The AGF said the plaintiff’s aim is to move all its fundsout of Nigeria before the case would be decided, adding that not granting the application would render thecourt’s judgment nugatory should it be in NCC’s favour.

However, Justice Idris said the AGF did not show enough evidence to prove that MTN was about to empty its bank accounts and move its fundsout of the country.
The judge said rather than grant the mareva injunction, he would hear MTN’s suit without delay and deliver judgment promptly.

Malami, who justified the imposed fine, said it was his duty, as the chief law officer, to ensure that all the laws made bythe National Assembly were obeyed. Justice Idris adjourned till January 22 for hearing.

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