Nigeria Seeks An Equitable Resolution To Dispute With MTN

"The recent sanctions on the banks arose due to irregularities with respect to repatriations made on behalf of MTN Nigeria Limited and were not in any way designed to restrict access to investor returns."

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MTN
MTN

The Central Bank of Nigeria is seeking an equitable resolution to an $8.1 billion dispute with MTN, Africa’s largest mobile phone operator.

Last month, the Central Bank of Nigeria (CBN) demanded $8,1 billion (R115 billion) allegedly paid as a dividend to MTN to be refunded to it.

The money was transfered by Standard Chartered, Stanbic IBTC Bank, Citibank and Diamond Bank.

Standard Chartered was fined 2.4-billion naira ($7.86m), Stanbic IBTC Bank 1.8-billion naira, Citibank 1.2-billion naira and Diamond Bank 250-million naira.

The move resulted in MTN’s shares being hard hit by the news.

Last month, MTN’s share price crashed more than 23% after it confirmed that the Nigerian authorities were demanding the $8.1 billion allegedly taken out of the country illegally to be paid back to its central bank.

“In response to the recent regulatory actions, the Banks and MTN are engaging the CBN and have provided additional information which is currently being reviewed with a view to arriving at an equitable resolution,” Isaac Okorafor, a spokesperson of CBN, said in a statement.

“We assure all investors that the integrity of the CCI (Certificates of Capital Importation) regime remains sacrosanct and there shall be no retroactive application of foreign exchange rules and regulations.”

He added that CBN welcomes all legitimate investors to take advantage of the enormous investment opportunities in Nigeria.

“The recent sanctions on the banks arose due to irregularities with respect to repatriations made on behalf of MTN Nigeria Limited and were not in any way designed to restrict access to investor returns.”

MTN CEO Rob Shuter told Reuters early this month t was confident a multi-billion dollar dispute with the Nigerian government would be resolved even as it applied for a court injunction to protect its Nigerian assets.

“Nigeria, it’s our largest market. We’ve been operating there since 2001,” Shuter told reporters at the ITU Telecom World conference in Durban. “We do have some challenges these past few weeks, but we believe we will be able to make our case and I’m sure we will move past that as soon as we can.”

MTN has applied to the High Court of Nigeria to protect its assets and shareholder rights within the confines of the law while the company continues to engage with the relevant authorities.

“We believe that we have complied with all relevant laws, and in light of that, and the conflicting instructions from different organs of State, we have had no choice but to seek relief from the Courts in Nigeria. We remain firmly committed to the Nigerian market and will continue to engage with the authorities on these matters,” Shuter said earlier this month.

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