MTN Group contests operating licensing fee USD213 million in Benin

MTN Group contests operating licensing fee USD213 million in Benin

South Africa’s MTN Group said it is currently in disagreement over a license fee it was levied in the Republic of Benin put at USD213 million.

The group said in a statement that:

MTN Benin has received notification from the telecoms regulator (ARCEP) on the 8th November 2017 that a process was being initiated to review the reasons why MTN Benin has not paid outstanding invoices on frequency fees for 2016 and 2017.

On 30 March 2017, the Government of Benin issued MTN Benin frequency fees invoices for an amount equivalent to approximately USD 213 million for the period March 2016 to December 2017.

Whilst the license agreement prescribes the calculation methodology for frequency fees it also provides that fees should take into account regional benchmarks, international practises and the local economy.

MTN Benin has contested this amount on the basis that, inter alia, the amount is excessive which has been confirmed by an independent benchmark report commissioned in terms of MTN Benin’s license.

We will continue to engage with the regulatory authorities in Benin to find an amicable solution to this matter.

MTN has not paid the fees, Benin authorities acknowledged that they are reviewing the non-payment of the invoice sent to the company.

It is not clear if the matter will degenerate into a lawsuit, however, MTN Benin might afford a shut down as it currently holds over 50% market share in the country.

Nigeria’s Globacom also operates in Benin with a smaller market share.