Broadband licences revocation: Transmitting wrong signals

The Ministry of Information’s insistence that the 2.3 GHz licenses awarded by Nigerian Communications Commission (NCC) be retracted is a curious case of conflicting signals. Rather than clarify the reasons for its decision, the ministry bandies the rule of law and due process about; emblematic of the present administration’s similar actions.

What is at stake is the NCC’s independence to manage, administer and regulate the telecoms sector. More so the regulator of any other sector in the country. An impartial and independent regulator exudes confidence. A meddling government, over reaching its limits of formulation, determination and monitoring of general policy, doesn’t augur well.
Why the quibbling? The Ministry of Information says the directive from National Frequency Management Council (NFMC) did not follow due process. NCC contends the contrary. A signed letter by the former minister and chairman of NFMC backs NCC’s claims. Then the argument that section 28 sub-section E of 2003 NCC Act was violated. That sub-section reads: “Ensure fair competition in all sectors of the Nigerian communications industry and also encourage participation of Nigerians in the ownership, control and management of communications companies and organisations”.
Fairness and participation, however desirable, cannot be stretched infinitely. 41 applications for four available licences were made. Agreed, the five-day ultimatum for payment was rather short – as pointed out by the chairman of NCC. Even so, none of the bidders complained. Yet, the Federal Ministry of Information insists that due process and the rule of law were not followed. Nonetheless, the fate of investors that coughed out 4.104 billion naira for the licenses is left hanging.
With respect to the NFMC letter authorising NCC to sell the spectrums, nothing suggests the Council acted beyond its powers. The NFMC’s duties, among others, are to “carry out bulk trans-sectoral allocation of spectrum to statutory bodies that are authorised by enabling laws to allocate spectrum to end-users”.

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Besides, “decisions of the Council Committees shall not be effective and valid until they are adopted and agreed upon by the NFM Council”. The letter authorising the sale of the licenses complies with the above. The said letter was signed by the former minister on behalf of the council. In a show of rigidity, the Ministry of Information twists the tale. It alleges that the NCC is sabotaging GSM tariff.
A cursory look at the 2003 NCC Act suggests that unless categorically disproved, NCC has followed the rule book in awarding the licenses, the sale process aside. NCC is said to have pegged the price for the frequency and invited bidders rather than an auction similar to the first three GSM licenses. Industry analysts lend weight to this process. It prevents end-users from paying more since auctioning might have raised the costs such that eventual winners would have charged steep prices to recoup their cost.
Government’s meddlesomeness is considered one of the risks of doing business in Nigeria. Retroactive revocation of already awarded licences based on insubstantial claims is an unaffordable risk. Such practices are becoming the norm rather than the exception. Discretionary award or revocation without explanations makes investors giddy.
Unless there was concrete proof of impropriety, other than the level of participation, due process and rule of law which have been made public, the Ministry of Information is sending the wrong signal to prospective investors and players in the industry.