Mobile Operator Vodacom to fight back after Lesotho revokes its operating license

Why is Lesotho trying to shut down its biggest mobile operator? Bruce Whitfield speaks to TechCentral editor Duncan McLeod.

Lesotho’s informed Vodacom its operating license is being revoked, after the country’s communications authority imposed a huge fine on the company on Monday. 

Vodacom has said it will take the matter to court.

The dispute centers on allegations that the mobile operator hired an auditing firm allegedly owned by the sister-in-law of Vodacom Lesotho chairperson, Matjato Moteane.

Bruce Whitfield gets more detail from the editor of TechCentral, Duncan McLeod.ADVERTISING

About ten days ago or so the regulatory authority issued a fine equivalent to about R134 million against Vodacom Lesotho, accusing it of various things including being in breach of corporate governance over its auditing firm.

Duncan McLeod, Editor – TechCentral

The accusation is that his sister-in-law owns the auditing firm.

Duncan McLeod, Editor – TechCentral

The Lesotho Communications Authority [LCA] is saying, this is not only in breach of your license conditions but in breach of the Companies Act in Lesotho… and you must pay R40 million worth of this fine immediately.

Duncan McLeod, Editor – TechCentral

The remaining amount is suspended for five years provided the company “does not commit any further contraventions of its regulatory obligations” during that period.

But they’ve now written a letter, today, to Vodacom Lesotho saying your license has in fact been revoked.

Duncan McLeod, Editor – TechCentral

The company intends to lodge an urgent high court interdict against the LCA, saying the body’s own rules state that Vodacom should have been given a certain amount of time to respond.

Lesotho is Vodacom’s smallest operation by subscriber numbers, McLeod says, but it is the biggest mobile operator in the country.

We know that the country is politically unstable and I do wonder whether there’s something more to this in terms of the politics, and possibly business machinations going on between the political interests in the country.

Duncan McLeod, Editor – TechCentral

Background

The Lesotho Communications Authority has issued a notice threatening to revoke the licence of mobile operator Vodacom in that country. The authority said Vodacom has failed to pay a R40 million fine that was due on Wednesday.  The regulator said Vodacom had been using an external auditor who is the sister-in-law of the board chairperson. It also fined Vodacom R140 million for failing to comply with directives to appoint another auditor.

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