GUINEA-BISSAU REGULATOR SEIZES SPACETEL EQUIPMENT TO SHUT IT DOWN

Telecoms

The Guinea-Bissau regulator has raided the headquarters of the country's second mobile operator and seized all equipment that enables it to make international calls. Police were used in the raid even though the company has a "cease and desist" order from the local courts, allowing it to operate the link. Initially a small group of police tried to persuade the company to cut the international link but they refused. Later a larger number of police returned and seized the equipment.

Guinea-Bissau was one of the last African countries to get mobile telephon. SpaceTel won the bid to become its first mobile operator. Almost immediately the incumbent telco GuineTelecom decided to make a pre-emptive strike and launch its own network. Their new cell phone company, called GuineTel, never received a presidential decree from the Interim President. GuineTelecom had been in a long-term dispute with its owners Portugal Telecom who fled the country after the civil war of 1998.

The dispute was resolved and the Prime Minister signed a contract with Portugal Telecom, giving it exclusive telecommunications rights until 31 December 2005. And this has created the current dilemma as it had already given a licence to SpaceTel, signed by the Prime Minister (along with the Minister of Telecommunications) but not approved by the Council of Ministers or the National Assembly, which could in effect annul SpaceTel's international license.

Faced with all these legal uncertainties, SpaceTel decided last year to begin its international call service and simulataneously, they opened a network throughout the country, while their competitor, (GuineTel), only offered its services in about 30% of the country. SpaceTel is owned by Investcom Holdings of Luxembourg.

The new President of the regulator ICGB (a former employee of Marconi, the predecessor to Portugual Telecom) did not accept the agreement signed with SpaceTel. Over the last six months there has been continuous meetings between the Ministry of Telecommunications and the regulator to try and resolve the situation.

It is these kinds of uncertainties and heavy-handedness that make Africa for all but the most strong-willed of external investors. The independent regulator siding with the incumbent and the Courts and parts of Government siding with the first mobile operator? You couldn't make it up and get believed.