$8.1bn demand: MTN opts for out-of-court settlement with CBN

 
Telecommunications firm, MTN Nigeria Communications Limited, on Tuesday, asked the Federal High Court in Lagos to further adjourn the hearing in the suit it filed to challenge the $8,134,312,397.63 being demanded from it by the Central Bank of Nigeria (CBN).
The $1.8bn demand by the CBN followed alleged forex remittances infraction by MTN.
MTN’s lead counsel, Chief Wole Olanipekun, told the court that his client had approached the CBN for possible amicable resolution of the dispute.
He urged Justice Saliu Saidu to further adjourn the suit to enable parties to fully explore out-of-court resolution and deliberate on the terms of the settlement.
The position was confirmed by CBN’s lead counsel, Mr. Seyi Sowemimo (SAN), who added that the discussions for possible out-of-court settlement were in the advanced stage.
Consequently, Justice Saidu adjourned till December 12, 2018, for a report of the settlement between the parties.
MTN filed the suit, marked FHC/L/CS/1475/2018, in November, urged the court to the declaration that the CBN acted ultra vires its statutory powers when it wrote an August 28, 2018 letter to it demanding a refund of $8.1bn.
The firm urged the court to hold that the CBN’s $8.1bn demand was “illegal, oppressive, abusive, unauthorized and unconstitutional.”
The telecommunications giant urged the court to declare that “the 1st defendant’s decision in its letter of August 28, 2018 with Ref No GBD/GOV/COM/DGF/118/121 addressed to the plaintiff and titled, ‘Investigation into the remittance of foreign exchange on the basis of the illegal capital importation certificates issued to MTN Nigeria Communications Limited’ were reached in breach of the plaintiff’s right to fair hearing.”
It also urged the court to void a September 3, 2018 letter written to it by the 2nd defendant, the Attorney General of the Federation, demanding $8.1bn as “penalties for the offence of ‘infraction of forex remittances’.”
MTN sought a court order “restraining the 1st and 2nd defendants from giving effect to the decisions, demands, and directives in their letters of August 28, 2018, and September 3, 2018, respectively.”
However, the CBN, in its statement of defense and counter-claim, urged the court to dismiss MTN’s suit, insisting that the telecommunications giant must refund $8.1bn to the federal government.
The dispute over $8.1bn repatriated funds started when the CBN alleged that MTN used improperly issued certificates to transfer funds out of Nigeria after the telecom giant converted shareholder loans in its Nigerian unit to preference shares in 2007, but MTN denied the allegations.
The apex bank said MTN’s banks failed to verify that the telecom group had met all the country’s foreign exchange regulations.
 

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