The Central Bank of Nigeria has declared the decision of its argument with MTN Communications Limited, saying the organization will presently make up just for the illicit reimbursement on inclination shares announced in 2008.
CBN’s representative & chief of corporate correspondences, Isaac Okorafor, reported the progress in an announcement distributed on the bank’s site on Monday.
The MTN additionally authenticated the agreement in an announcement also announced in Johannesburg.
As per the terms of agrement, the CBN advised MTN Nigeria to execute a notional turnaround of the 2008 private arrangement of offers in MTN Nigeria at a net expense of around N19.2 billion – identical to US$52.6m (the notional reversal amount).
“This is on the basis that certain certificates of capital importation (CCIs) utilised in the private placement were not properly issued.”
“MTN Nigeria and the CBN have agreed that they will resolve the matter on the basis that MTN Nigeria will pay the notional reversal amount without admission of liability”, MTN stated.
“In terms of the resolution agreement, the CBN will regularise all the CCIs issued on the investment by shareholders of MTN Nigeria of circa $402,625,419 without regard to any historical disputes relating to those CCIs, thereby bringing to a final resolution all incidental disputes arising from this matter.”
The CBN revealed that MTN was told some months back to move back to Nigerian pocket $8.1 billion repatriated around 2007 & 2015, on account of capital importation authentication inconsistencies.
4 banks engaged with the restoration, Standard Bank, Stanbic IBTC Nigeria, Citibank Nigeria & Diamond Bank Plc, were charged by the CBN.
Standard Chartered Bank was charged N2.47 billion, Stanbic IBTC, N1.88 billion, Citibank Nigeria, N1.26 billion & Diamond bank, N250 million.
Here is the announcement by CBN:
The Central Bank of Nigeria (CBN) in August 2018 directed MTN Communications Limited (MTNN) to reverse repatriations valued at $8.1 billion done on its behalf by four commercial banks between 2007 and 2015 on the basis of Certificates of Capital Importation (CCIs) irregularly issued to MTNN.
Following the keen interest shown by various stakeholders sequel to the regulatory action, the CBN committed to engage further with MTNN with a view to achieving an equitable resolution.
Consequent upon the above, MTNN, led by its Nigerian shareholders, held intensive engagements with the CBN in the course of which it supplied additional material information, not previously offered to the Bank, satisfactorily clarifying its remittances. Having now reviewed the additional documentation provided by the company, the CBN has concluded that MTNN is no longer required to reverse the historical dividend payments made to MTN Nigeria shareholders.
However, the CBN identified that the proceeds from the preference shares in MTNN’s private placement remittances of 2008 were irregular having been based on CCIs that were issued without the final approval of CBN.
The CBN and MTNN have mutually agreed that the aforementioned transaction be reversed notionally to bring it into full compliance with foreign exchange laws and regulations.
The parties have resolved that execution of the terms of the agreement will lead to amicable disposal of the pending legal suit between the parties and final resolution of the matter.
“The CBN assures foreign investors that the integrity of the CCIs issued by authorised dealers remain sacrosanct. Potential investors are encouraged to take advantage of the enormous investment opportunities that abound within Nigeria”.
However, the telecommunications giant has another issue to resolve: the court suit over the demand by the attorney general for back taxes.
MTN assured its shareholders that it is also moving towards resolution of this problem.
“Shareholders are advised that the legal process initiated by MTN Nigeria for injunctive relief restraining the AGF from taking further action in respect of its orders for back taxes is continuing.”
“The AGF matter came up for initial mention before the Federal High Court of Nigeria Lagos Judicial Division on 8 November 2018 and has been adjourned to 7 February 2019. MTN Nigeria continues to maintain that its tax matters are up to date and no additional payment, as claimed by the AGF, is due, and consequently no provisions or contingent liabilities are being raised in the accounts of MTN Nigeria for the AGF back taxes claim”, the company said.
The attorney-General of the Federation (AGF) is demanding from the company the payment of N242 billion and 1.3 billion dollars, for import duties and withholding tax.