CRAN loses legal battle against MTC

The dispute centres whether the nullification of levies is only valid from the date of judgement, or has a retroactive effect.

17 June 2021 | Technology

Marc Springer


The High Court has blocked the Communications Regulatory Authority of Namibia (CRAN) from implementing plans not to consider an application for a spectrum licence made by Mobile Telecommunications Limited (MTC) until the latter had settled N$100 million in outstanding levy fees allegedly owed to the regulator.

Although the Supreme Court declared these levies charged by CRAN to be unconstitutional three years ago, the tiff about the tariffs continued.

This time around, the dispute centres whether the nullification of the levies is only valid from the date of judgement or has a retroactive effect.

CRAN argued that the invalidation of the levies to 56 telecommunication providers, radio stations and TV institutions registered with it only took effect on the date of judgement, 11 June 2018.

As such, it insisted that Telecom and MTC still owed it N$67 million and N$100 million respectively; amounts that were allegedly outstanding on the date the levies were struck by the Supreme Court.

The CRAN board decided on 23 March that it would not consider any licence applications by entities until all their levies were paid in full.

The regulator refused a request for a spectrum licence for fixed satellite services filed by MTC in 2000, stating the applicants still owed N$100 million in outstanding levies and were thus not in good standing.

MTC launched an urgent application against that decision, and Judge Harald Geier ruled in its favour yesterday.

‘Irregular, unfair, unreasonable’

In an affidavit filed with the High Court, MTC’s legal officer Patience Kanalelo pointed out that CRAN’s decision was "irregular, unfair and unreasonable".

She further said between February 2018 and February 2021, MTC had made no less than 30 other applications to CRAN, which were all granted.

Despite the dispute about the alleged outstanding license fees still being ongoing during that two-year period, CRAN "never adopted the coercive approach it recently employed and not once was the prevailing circumstances regarded as MTC not being in good standing".

Kanalelo also stressed that there was no judgement supporting CRAN’s contention that the striking of the levies had no retroactive effect and MTC was thus still liable to pay all outstanding fees.

The Supreme Court declared the levies unconstitutional, reasoning that it was impermissible for CRAN to charge a fee amounting to 1.5% of the turnover of all the registered licence holders.

The judgement was the result of a lawsuit filed by Telecom in which the state-owned company argued the levy could not be linked to the turnover of individual communication providers since they all benefitted from the regulatory work done by CRAN in equal measure and should thus all pay an identical fee.

CRAN had opposed that argument, saying it was financially dependent on the income derived from levies and could not function as an independent and efficient regulator without it.

The regulator has since repeatedly stated that without the income derived from levies, its financial situation has deteriorated to such an extent that it is hardly able to provide the service it was tasked with any more.

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