No levy relief for mobile operator’s losses due to deactivated SIM cards

Martin Endjala

Communications Regulatory Authority of Namibia (CRAN), says it will not offer levy relief to mobile operators who lose money due to deactivated Subscriber Identification Module (SIM) cards as a result of unregistered cards.

The regulator insists that the only solution to avoid such losses is to ensure that the three-month period given to SIM card holders whose numbers have been deactivated for failing to register their cards before the set deadline on 31 March and ensure they retain their numbers.

This is according to CRAN’s Chief Executive Officer, Emilia Nghikembua while responding to questions sent to the regulator by Observer Namibia, regarding contingency plans to assist mobile operators who stand to make a loss in the form of levy relief.

Nghikembua clarified that any revenue loss incurred by operators due to regulatory variances is not considered a direct cost of regulation. “Consequently, the authority will not provide relief”.

She stressed that mobile operators must ensure that deactivated SIM cards are registered and reactivated during the three months.

“While it is true that projected losses will affect the sector’s overall financial outlook, the authority is encouraged by operators’ proactive measures to mitigate further losses.

It is crucial to understand that the authority’s primary responsibility is to ensure regulatory compliance within the telecommunications sector. This is essential for operators to protect their financial interests and maintain viability,” said the CEO.

She explained that the levy regime operates on a cost-based principle intended to cover regulation expenses. Adding that the most effective approach to addressing this challenge is to conduct proactive campaigns to reconnect unregistered SIM cards.

She reminded operators working in a regulated environment to recognise that any deviation from regulatory compliance will inevitably impact their operational efficiency and financial standing.

Nghikembua underscored the imperativeness for operators to establish robust systems to ensure compliance and implement rigorous mitigation strategies to counteract the negative effects of any compliance lapses. This risk, she said, is inherent in any regulated industry.

Early this month, Mobile Telecommunications Limited (MTC) announced that it has deregistered an estimated 323,200 customers, contributing about 3.1 percent of the company’s revenue, which equates to an average of N$8.1 million in revenue per month.

Since the mandatory process started, MTC has registered over 1.6 million SIM cards, representing an 83.3 percent registration rate.

Telecom Namibia indicated that it could lose N$7.5 million per month due to its 191 598 deactivated unregistered SIM cards. The company records indicated 442,410 active mobile subscribers as of 31 March 2024.

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