MTN sues Uganda Telecom over Shs7b

Mergers, Acquisitions and Financial Results

MTN Uganda has taken its competitor, Uganda Telecommunications Ltd to court, seeking payment of Shs7.2 billion in interconnection fees. In its case filed at the High Court’s Commercial Division, the communication company accuses UTL of breaching a contract the two companies signed for a period of November 2008 to September 30 2009.

MTN claims on February 1, 2001, its management entered into an agreement with UTL where the parties agreed to interconnect their respective telecommunication network system for purposes of providing a broader range of services to the largest number of the public. This, according to MTN, was a requirement in their respective telecommunication license with the Uganda Communications Commissions.

MTN contends that the two agreed to pay each other interconnection fees for stated period.

According to MTN, in accordance with the interconnection charges that were detailed in the agreement, its management issued invoices to UTL claiming payments due but UTL failed to pay the money.

“In accordance with Section 6 of charges for interconnection fee and Article 7 which provides for payment, the plaintiff issued invoices for interconnection fee due to it... but the defendant has refused to pay the money which has accumulated interest of Shs757.7 million,” read part of the plaint.

According to MTN, the management of UTL issued two cheques worth Shs600 million as payment for the debt but the cheques bounced. MTN wants a court order compelling UTL to pay money claimed with interest, damages and costs.

The court’s registrar, Ms Glady’s Nakibule, has issued summons giving the management of UTL 15 days within which to respond to the case, failure to do so MTN may proceed with the matter and judgment may be entered in their absence.

The Monitor