The commercial court has ordered telecoms giant MTN Uganda to pay the sum of Shs 2.3 billion (about $662,000) in damages to EzeeMoney Limited for sabotaging its business.


Justice Henry Peter Adonyo on November 6, 2015 also ordered MTN to stop acting in an unlawful and anti-competitive manner, which denies other businesses an opportunity to prosper.

Justice Adonyo said MTN should pay Shs 800 million to EzeeMoney in general damages for loss of business. It should also pay a penalty of Shs 1.5 billion in punitive damages to deter not only MTN but also warn other companies against uncompetitive business tactics, reported NAN/Reuters in a joint report on Wednesday.

It all started when EzeeMoney, which runs an e-money business, obtained a contract from MTN for the provision of digital transmission [E1] and 30 fixed telephone lines to carry out its mobile money business.

EzeeMoney then contracted Yo! Uganda Limited (YUL) to implement the service after Uganda Communications Commission, the regulator, approved it on December 2012, to use the 7711 short code to enable its customers to subscribe for e-money services.


But in 2013, MTN cancelled the contract, saying EzeeMoney was a direct competitor to its mobile money business. Through AF Mpanga and company advocates, EzeeMoney went to court, saying MTN’s action “restricted and distorted competition”.

EzeeMoney said MTN also damaged its ties with YUL and deprived it of services of other telecommunications operators. It argued that MTN used its exclusivity agreements to stop its agents from working for any other firm with similar business, further limiting competition.

In a January 28, 2013 letter to EzeeMoney, MTN appeared to say its business would be disrupted if the former was given access to its platform.

“EzeeMoney is in direct competition with MTN in the provision of mobile money,” read the letter in part.

Justice Adonyo said the letter confirmed that MTN was stopping services of the company because it considered it a competitor.

“It is testified that when YUL required the defendant (MTN) to activate the plaintiff’s (EzeeMoney) short code on its platform, the defendant declined to do so on the basis that the plaintiff was in direct competition with it,” the judge observed.

“YUL then seeing that the plaintiff couldn’t carry out the business they had agreed together, by a letter dated 7/2/2013, did terminate all services with the plaintiff as YUL did not want to jeopardize its relationship with the defendant.”

The judge also found that MTN coerced its agents to reject EzeeMoney. One witness, Sammy Mwathi, told the court that he was an MTN money agent and he was restricted from dealing with other firms in the same business by signing exclusivity agreement.

The ruling in Uganda came at a time when MTN Group has just suffered a $5.2 billion fine in Nigeria after it failed to disconnect unregistered lines.

Acidosis:
Now this fine is ideal and decent.



Unlike the greedy NCC

sonOfLucifer:

Did you read the article? Do you understand why they have been fined? Did you understand the nature of the offence? Is it similar to the one for which they received a fine in Nigeria?

Do you know they signed an agreement with NCC, and the fine wasn't arbitrary? Ignorance isn't a crime.

Acidosis:

It doesn't change the fact that NCC, like the typical Nigerian, is greedy

Datsme:
E con be like - Mtn is being forced to vomit all the unjust wealth it has accrued @ any cost. Una remember dt very time when a sim goes for as high as 30k+. No sympathy for dem

Acidosis:


This is WHY Business Education must be properly enforced on all Nigerian students.

There is something they call PESTEL, & 5 Porter's forces in Business/Marketing. There is something they call Relational Capital, Employee capital and supplier capital in entrepreneurship.

Do you know the cost of fibres, and other telecommunication materials when sim cards were sold for N30,000?

Do you know the weight of political forces and legal issues alongside the associated costs 10 years ago?

Why aren't you CASTIGATING NOKIA for selling you a PKALASA phone at N40,000 some 8years ago?

Why MTN?

When they tell people like you to attend business and entrepreneurship classes, you wouldn't go, but you'd sit back eyeing the CEO position in SHELL & AGIP. These are issues mere common sense should solve without quoting some complex business models and consumer theories.

Acidosis:


This is WHY Business Education must be properly enforced on all Nigerian students.

There is something they call PESTEL, & 5 Porter's forces in Business/Marketing. There is something they call Relational Capital, Employee capital and supplier capital in entrepreneurship.

Do you know the cost of fibres, and other telecommunication materials when sim cards were sold for N30,000?

Do you know the weight of political forces and legal issues alongside the associated costs 10 years ago?

Why aren't you CASTIGATING NOKIA for selling you a PKALASA phone at N40,000 some 8years ago?

Why MTN?

When they tell people like you to attend business and entrepreneurship classes, you wouldn't go, but you'd sit back eyeing the CEO position in SHELL & AGIP. These are issues mere common sense should solve without quoting some complex business models and consumer theories.