LCA tightens screws on mobile operators


Herbert Moyo

THE Lesotho Communications Authority (LCA) has tightened the screws on the country’s mobile communications operators by ordering them to seek the authority’s approval before appointing chief executive officers (CEOs), directors and other senior managers.

Vodacom Lesotho and Econet Telecom Lesotho are the country’s two mobile phone operators. They both received letters from LCA CEO, ‘Mamarame Matela, ordering them to obtain written approval from the authority before appointing CEOs and other top officers.

A copy of the letter seen by this publication yesterday is titled: ‘Directive on prior approval of approval of directors, officers, senior managers and auditors of unified licensees and biennial fit and proper assessments’.

“All holders of unified licenses shall obtain prior written approval of the Authority before appointing any of the following officers:

“All directors; chief executive officers; chief technology officers; chief financial officers; chief operations officers; human resource managers; company secretaries; head of legal; head of compliance; head of marketing and public relations; head of commercial and sales; chief internal auditors and chief information officers.

“All existing officers shall within three months of issuance submit their applications for approval accompanied by comprehensive curriculum vitae indicating relevant qualifications, experience in their current roles including certificates of registration with relevant professional bodies where applicable,” Ms Matela states in the letter to the mobile operators dated 10 November 2020.

She said all senior company officers would now be required to complete a ‘Fit and Proper Assessment Form’ which will be available on the LCA website.

They must complete the form within three months of its issuance by the authority and thereafter, every two years.

“All new appointments of officers shall be subject to the prior written approval of the Authority upon application for such approval, provided that officer meets the fit and proper assessment by the Authority,” she added.

The new requirements come against the background of the LCA’s attempts to stamp its authority on what it views as errant behaviour by the mobile communications companies.

The two companies have had run-ins with the LCA over various alleged infractions.

Vodacom is currently locked in a legal battle with the authority over its 8 October 2020 decision to revoke the latter’s operating licence.

The LCA issued a notice to revoke Vodacom’s licence after the company refused to pay a M40, 2 million imposed on it for allegedly violating its licensing regulations by among other things “submitting audited financial statements that were unaccompanied by a certification issued by an independent external auditor”.

Vodacom instead opted to file an urgent High Court application for an interim order nullifying the revocation. This was duly granted by Justice Thamsanqa Nomngcongo paving the way for the company to continue providing services until its application for a final order against the decision to revoke its licence is heard by Justice Keketso Moahloli on 27 November 2020.

The LCA board chairperson, Ms Matela and the LCA are first to third respondents respectively in the application.

Econet on the other hand was fined M1, 5 million for the late submission of its licence renewal application. It has since paid the fine.

Last week, the LCA also amending the licensing regulations to allow more players into the mobile communications industry.

In the past, companies had to wait for the LCA to issue an invitation to apply for them to apply for licences but the invitations never came enabling Vodacom and Econet to enjoy a duopoly in the sector for more than a decade. Vodacom was the first to be licenced in 1996 and Econet followed suit in 2008.

But their stranglehold on the sector is set to end after the LCA amended the regulations to allow more players. In terms of the new regulations, prospective mobile phone operators need not wait for the LCA to invite applications. They can apply without prior invitation as long as they meet the criteria which includes “financial and technical capabilities to own and construct a network that will efficiently provide services to the Basotho nation”.

Commenting on the latest regulations yesterday, Ms Matela said the new requirements were not aimed at punishing anyone.

She said they were meant to ensure that the top officers appointed by the licensees “are well qualified” to run them.

“On 13 May 2020, the (LCA) board made a decision to start subjecting directors and officers of our licensees to proper assessments in the light of some of the challenges experienced by consumers.

“This is part of the consumer protection and strategic direction that the LCA is taking. Whenever, we have found something wrong the organisation is fined but nothing happens to the management or directors. They will continue to do the wrong thing over and over again without facing any consequences. So, the main thing we are trying to achieve (with the new requirements) is to ensure that people are accountable.

“We want to ensure that the people appointed by these organisations to positions where they control a lot of public money are well qualified,” Ms Matela said.

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