Earlier today we wrote about the notification issued by local telecoms regulator POTRAZ, to mobile network Telecel Zimbabwe advising it of the cancellation of its licence.
Telecel has since issued a statement calling the action unfair and stating that it will take the necessary steps to ensure the maintenance of services. We haven’t received any other comment from other players involved in this issue, but we will keep you updated. In the meantime, you can read the full statement from Telecel below.
Telecel Press Statement on Licence Cancellation
Telecel Zimbabwe has been notified by the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) of the cancellation of its licence to provide national cellular telecommunications services.
This measure is unfair and unwarranted. Telecel has made every effort to comply with all legal and governmental requirements in Zimbabwe, and objects to this treatment in the strongest terms.
Telecel and its global shareholders are taking immediate action both locally and internationally to challenge this decision.
Telecel would like to assure its customers and stakeholders that it will take all possible steps to maintain the full range of its services throughout this process.
We thank all our valued customers and partners for their on-going support. Your welfare is of the utmost importance and priority to us and we will continue to act in the interests of Zimbabwe and its people.
Telecel Zimbabwe
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21 comments
Its about time Telecel took the bull by the horns. 11% to the workers. Ndiyo indegenisation yacho.
VaMugabe chipindirai…. Mosiya unemployment ichikwira pakadai….. mabasa hakuna iwo mashoma mongovhara zvamunogona kugadzirisa. vashandi veTelecel, other people who have been benefiting, other companies, maguards mavendor. Inga vari kuda kupa vashandi 11% chaipa chii, is it because pane masharks anga achida… VaMugabe muripiko nyika ichi urawa nevafana ava
When has POTRAZ become an enforcer and or regulator of Indigenization ? POTRAZ is being used as a front. POTRAZ is a professional body mandated to deal with postal and telecommunication issues and NOT indigenization. They are being used as a condom.I will tell it as it is.
Hahaha, “They are being used as a coondom”
DEINDIGINISATION..aah aah hihihi
Like Mai Masamba would say, “Chatsvuka chikakwata”
If they do not want the 11% to be given to the local Telecel employees, why then not take them and hold them in trust until a “suitable” investor is found instead of shutting down a company that has been paying its taxes fully unlike others that we know have been allowed to operate without doing the same. Surely a solution that does not involve shutting down such a big company could have been found??
Cry the beloved country!!
And to know that some people have been licensed to open banks and newspapers and then allowed to employ slaves or they kindly call the volunteers and get away with. Telecel is paying its taxes, wants to pay its subs, pays its workers regularly and on time and they become victims. This is the problem when teachers by virtue of holding a party card are put into regulatory boards to regulate what they don’t know just because the head of the home was also a teacher, its is a mess. I have no bone to chew with teachers but being putting teachers mujibhas and chimbwidos into highly technical ares is a risking the economy of a country its not done in normal societies.
The issue of the payment of licence fees for Telecel have been deliberately muddled up and it is high time the truth be told. The total licence fee for every operator renewing their licence was set at $137.5m. It has always been argued that this fee was way too high for an economy like ours but that argument will be argued for another day.
Documents from the regulator will indicate that the biggest operator in the country used up to $80m that it was owed by the Government operators in interconnect fees to offset its fees. In other words, the biggest operator paid $57.5m. Of course the reality is that it was the Zimbabwean tax payers who paid the other $80m because they subsidised the Government operators by allowing money that should have flowed directly to Treasury to be used in paying that debt.
Telecel, on the other hand, was owed only $12m by the same Government operators and they also used that to offset the $137.5m levied. Clearly, only very big companies would be able to raise the difference required. It is understood that Telecel went to the regulator and negotiated for a phased payment plan which was approved. They were supposed to pay another $20m in the first year and the rest spread out over some years. In addition to the initial $12m, they paid the$20m in the same year. The unfortunate thing was that $6m of that money was not honoured by one of their banks, MetBank because of the liquidity crisis that hit that bank then. Up to now that money has not been honoured by the bank. So Telecel had to fork out another $6m to cover that gap. The next instalment is due this June and another in December. These instalments are all in order as per agreed payment plan.
People have been given the impression that Telecel has not paid anything at all and this is wrong. No one can really fault someone for being honest in indicating they are not able to pay such a huge sum all at once and for negotiating payment terms. It is one thing not to pay at all and another to ask for a payment plan.
In this operating environment, how many companies are able to pay $137.5m as a one-off payment. At some stage, the hope is that all about Telecel will be revealed and those that have been trying to influence things negatively for the organisation in the shadows will be revealed. Telecel has a convoluted history but it has been trying to clean up its image. It is unfortunate that it is not given the chance to succeed.
Hi.
Interesting reading and it seems you got more information, am interested in this case more, pls inbox me more details in my email provided there.
Linus
tell me more detail on my email
whats your email address
I think techzim you should write on the effects the closure. Chief among them will be tax which will spiral down to the fiscus to our empty coffers At a glance we are talking of Telecel company tax, airtime tax, its employers paye, contractors and suppliers vat, their boosters are running on electricity and fuel 24 Hrs i presume……Then there is also the increase in unemployment rate of all these entities affected. Just too painful to talk about. Maybe infographic content might explain better asi zvinorwadza
We would want to know what business analysts think of such a move as well.
i also think that we should look at the repercussions of closure of a company like telecel. Zim asset wants to create 2mil jobs, the gvt wants to close off 2000. now thats looking for people to take to the streets. i am sure there are alternative measures the gvt can take to better manage this situation.
90% unemployment and then the govt says they want t shutdowm a big company? Who does that??
Econet paid 137 mill. Econet is an indigenous company. Telecl did not pay. telecel is not 51% indigenised. That is all to say. telecel must close. case closed. However I predict that telcel is not closed. Now that it is ‘closed’ the foreign majority shareholders will sell their shares at firesale prices and a group of Zimbabwean investors will take ownership of the cell company. Keep your lines telecel loyalists. Closing the company is merely negotiation ‘by other means’.
Documents from the regulator will indicate that the biggest operator in the country used up to $80m that it was owed by the Government operators in interconnect fees to offset its fees. In other words, the biggest operator paid $57.5m. Of course the reality is that it was the Zimbabwean tax payers who paid the other $80m because they subsidised the Government operators by allowing money that should have flowed directly to Treasury to be used in paying that debt.
Advantage Econet! i have a feeling that the authorities are not keen on a solution that closes out some vultures angling to worm their way into Telecel. why would they refuse to let the workers take up the 11%? Are they not Zimbabwean workers? Minister Supa, taurai chokwadi!
All this nonsense about Telecel having met its license renewal obligations is all balony. It is not true to say that they paid $20m the first year as purported by some overzealous and misinformed blogger above. The agreement struck with the then Minidtry of Infrastructural Development and Communications under Goche allowed for an initial downpayment of $14M with subsequent payment to be made over a 7 year period. Trlecel managed to pay only $8M with the balance of$6m for the downpayment remaining outstanding for almost 2 years until a $5.3M payment that was made in Feb this year after repeated warnings from POTRAZ and the cancellation of the agreement by the new ICT Minister. In addition, as part of the conditional renewal of the license, the company was supposed to come up with an indigenisation plan before the end of 2013, which it failed to do until the recent pseudo 11% ESOP plan for employees that was rushed and presented to government only on March this year. It is important to note that precious proposals for lower ESOP schemes of 3-5% had been rejected by both shareholders in the past as they were considered to be excessive, and why the generosity now at the last hour.
In any case this 11% shareholding for employees through an ESOP scheme implies that they can’t vote or participate in any resolutions and this their equity is non participatory from a stakeholder perspective until their shares are fully paid for. Taking into consideration the current dismal performance of the company, there is no hope of dividends bro g paid soon implying that the intended future dividend streams that the employees are to use to pay up for their shareholding may not happen in the foreseeable future and thus the 11% ownership may never pass on to employees for a very long time to come.
Don’t be fooled. Telecel shareholders have abrogated their responsibilities for almost 2 decades and its time for new and more serious players to take over at the fledging company.
The biggest problem is even the head of the home does not know the value of the USD. How on earth did they arrive at that obscene figure, is this the reason why we hear of people being paid millions of backpay as if they are paid bearer cheques. Chinamasa has to go down to the drawing board, borrow some few budget books from his countrepart say RSA, do a bit of maths he will see that were a ministry in RSA gets 1 billion rands with a bigger economy, a Zimbabwean useless ministry gets 3 billion rands. Look even at our lawsuits, many goes to thousands instead of just hundreds because we don’t know the value of a USD. Go back to basics.
arsene wenger anogona shona. zvzzvinhu