$8.1bn Fine: MTN Group seeks off- court settlement with CBN

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Ralph Mupita, chief financial officer of MTN Group Ltd. Photographer: Waldo Swiegers/Bloomberg

Sources with the knowledge of the matter reveals that the South Africa’s mobile company, MTN Group is exploring the possibility of an out-of-court settlement with the Central Bank of Nigeria (CBN) over the $8.1 billion fine slammed on the telecoms firm last August.

MTN had filed a suit to challenge a directive by the CBN directing it to return the $8.1 billion, which the apex bank said was illegally repatriated.

When the case was called yesterday, MTN’s lead counsel, Chief Wole Olanipekun (SAN), said his client had decided to pursue an out-of-court settlement with the CBN.

Olanipekun said his client had approached CBN for an amicable settlement and this was confirmed by Seyi Sowemimo, CBN’s lead counsel, who told the court that the negotiations were already in an advanced stage.

Olanipekun said, “May it please your lordship, the matter today, is slated for hearing of pending applications, but we owe the court a duty to inform it that parties are engaged.

“Counsel have conferred, and in view of this, we are asking for a short date for report,”

On his part CBN counsel, Sowemimo, said, “We have advanced stages towards settlement, and it remains to cross the Ts and dot the Is; it is just for report of settlement.”

MTN had filed the suit, seeking an injunction to restrain the CBN and the Attorney-General of the Federal (AGF) from taking further actions to reclaim the alleged debts.

The firm asked the court to hold that the CBN lacked the power to determine its civil obligations or penal liabilities.

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It urged the court to declare that the CBN acted outside its statutory powers when it wrote a letter to it on August 18, demanding a refund of $8.1 billion.

It asked the court to hold that the demand was illegal, oppressive, abusive, unauthorised and unconstitutional.

On its part, CBN alleged that the telecoms firm improperly repatriated dividends, and requested that MTN should return $8.1 billion to its coffers.

Following this development and based on agreement of parties, the presiding judge of the court, Justice Saliu Saidu, adjourned till December 12 for a report on the settlement.

The CBN had September disclosed that it had been engaging MTN Nigeria and the four banks that were recently sanctioned over allegation of illegal capital repatriation.

The development, the apex bank said, followed the provision of additional information by the affected institutions, which it said was being reviewed.

Meanwhile, MTN had filed a sister case before another judge of same court, Justice Chukwujekwu Aneke, against the AGF, challenging a withholding tax assessment of $41.3 billion and an import duty tax of N242 billion.

MTN queried these assessments.

Justice Aneke has fixed February 7, 2019 for hearing of all pending applications in this suit.

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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