Court rules in favour of MTN in Swaziland

Telecoms

MTN Swaziland this week won a court case that will result in the closure of a network launched by Swaziland Post & Telecommunications Corporation because of a conflict of interest.

MTN Swaziland is 30% owned by MTN, 19% by the Swaziland Empowerment Group, with Swaziland Post & Telecommunications originally owning the other 51% — though it claims this was transferred to Swaziland’s finance ministry (41%) and King Mswati (10%), to pave the way for its independent entry into the cellphone sector.

According to the Times of Swaziland, Swaziland Post & Telecommunications was ordered by the International Court of Arbitration to end the mobile component of any telephony network and service it operated, including mobile data services or functions in competition with MTN Swaziland, voice or text messaging services.

It was also ordered to cease advertising or in any other way promoting these services and to stop canvassing subscribers and other potential users about them for as long as it is a shareholder of the joint venture agreement that exists between the two parties.

MTN Swaziland also said the orders of the Supreme Court and the International Chamber of Commerce had addressed with finality the conflict of interest that arose as a result of Swaziland Post & Telecommunications competing with MTN Swaziland while still a shareholder in it.

MTN Swaziland said it was not opposed to Swaziland Post & Telecommunications venturing into the service and competing with it, but it could not do so while still a shareholder in MTN Swaziland, the newspaper reported.

An analyst who declined to be named said Swaziland was a tiny market for MTN and it is unlikely any pricing pressure would have a negative effect on the company.