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LCA GIVES VODACOM 90-DAY ULTIMATUM

By Staff Writers

Maseru, Feb 17 (The Night’s Watch) – The fight between the Lesotho Communications Authority (LCA) and Vodacom Lesotho is over six months old, and in the latest round of the fight, LCA announced on Sunday that it has requested Vodacom to provide written reasons within 90 days why its licence cannot be revoked.

“The LCA is still waiting for submissions from Vodacom Lesotho,” LCA said in a statement on Sunday.

It accused Vodacom directors and shareholders of failing to appoint independent auditors as specified in Section 97(2)(g) of the Lesotho Companies Act of 2011 in a deliberate intention to undermine compliance with the laws of Lesotho.

“The licence conditions of Vodacom Lesotho require them to submit annual financial statements accompanied by certification issued by independent auditors,” it said.

It indicated that Section 97(2)(g) of the Lesotho Companies Act of 2011 prohibits a company from appointing a person related to an officer (director) of a company in a position to influence financial transactions or financial statements of a company as its auditor.

According to the Authority, from as far back as 2015, Vodacom failed to appoint independent auditors as specified in Section 97(2)(g) “in that the external auditor is a relative of the Chairman of the Board of Vodacom Lesotho”.

“The explanation provided by Vodacom Lesotho revealed a deliberate intention to undermine compliance with the laws of Lesotho,” it said.

The Night’s Watch reported on Friday that a high-level campaign is under way within the government to persecute and discredit Vodacom and revoke its licence using the company’s alleged non-compliance with the regulations as an excuse.

LCA on Sunday refuted this report and emphasised that in regulating the communications sector, it “always resolves issues of compliance in a fair, equitable and transparent manner”.

LCA is a statutory body, established in June 2000, with the mandate of
regulating the communications sector in Lesotho.

The mandate entails: granting licences to operators; promoting fair competition; approving tariffs; empowering and protecting consumers, among others.

It said on Sunday: “LCA reassures the public that all measures taken by LCA are designed to uphold compliance and stability within the communications sector to protect all affected parties including consumers, employees and investors in accordance with its mandate under Communications Act, 2012.”

During this obviously unusual times for Vodacom, its management has tried to put out an image of business as usual.

“Vodacom Lesotho is aware of media reports related to its operating licence conditions and is fully committed to addressing these through the relevant forums in due course,” Vodacom management said in a statement on Sunday.

The statement added that: “Vodacom Lesotho wishes to refute media reports that the Government of Lesotho has ordered it to halt its operations in Lesotho. Vodacom Lesotho remains licensed to provide telecommunications and M-Pesa services. In this regard, all services and products, Vodacom shops and independent outlets remain operational as normal.”

In its statement, LCA also accused Vodacom of “failure to pay licence fees on time”, “failure to meet Universal Service Fund obligations”, and “failure to comply with tariff conditions”.

It said on August 2, last year, it issued a penalty of M8.2 million against Vodacom “for failure to pay regulatory fees as they fell due and payable on or by 1 July 2019”.

It explained that the Lesotho Communications Authority (Licensing Classification and Fees) Rules 2018 prescribe on clear terms that the authority shall impose penalties for non-payment of regulatory fees and prescribes how these penalties shall be imposed.

Vodacom is challenging this penalty and the matter is pending before the High court.

The LCA also revealed in its statement that it paid M900,000 to Vodacom to provide internet in 30 high schools in 2016/17 financial year, 60 high schools in 2017/18 and 60 in 2018/19.

It said after it received complaints from some schools that had not received internet as promised, it requested Vodacom to provide complete reports in relation to the service but it failed to do so.

The communications act requires anyone who receives funds from the Universal Service Fund to provide complete and accurate performance reports.

LCA said: “The licence conditions of mobile network operators require them to issue timely and accurate billing to its customers. Vodacom Lesotho failed to provide correct, complete and accurate bills on time.

“Despite several requests to provide complete and accurate information regarding the provision of internet to schools, Vodacom Lesotho has still failed to do so. The matter is still pending before LCA.”

It added: “Vodacom Lesotho submitted a notification of Vodacom Summa Campaign to LCA together with the business rules to be applied during the campaign. LCA conducted a compliance audit and found that Vodacom Lesotho had failed to comply with their own declared business rules. The matter is still before the Authority.”

Vodacom Lesotho is a subsidiary of the Vodacom Group Limited, a South African mobile communications company, providing voice, messaging, data and converged services to over 55 million customers. NW

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