By Moses Kaketo
In what the Courts of law described as anti-competitive, telecom giant MTN Uganda terminated the system of solutions provider ezeemoney. As a result, hundreds of Ugandans lost their jobs and the company lost billions of shillings. The case was settled in courts in favour of the latter. This case exposed gaps in our policy frameworks, which must be fixed urgently to avoid the re-occurrence of the same in the future.
For example, the case revealed that the country badly needs fair trade laws for the entire spectrum of business. Yesterday, it was the telecom; tomorrow it could any other sector. Unfortunately, the Communication’s Act can only be applicable if the telecom is involved. Unlike other countries, there is no anti-competitive law in Uganda. Kenya and South Africa have very strong anti-competitive laws, the very reason why anti-competitive actions cannot happen in these countries.
Bank of Uganda (BOU) must fast track mobile money guides into law. In their defense, MTNUganda lawyers noted that the BOU guidelines which bars any telecom to exercise agent exclusivity are ‘‘mere guidelines and not laws’’. Thus, the telecom giant could not depend on them. Do we have to wait for the same to happen again? This case is a wake up call for BOU and Uganda Communications Commission (UCC) to ensure the guidelines are turned into law sooner than later.
From a policy perspective, there should be some sort of structure at Uganda’s Chamber of Commerce and Trade that supports new businesses.
This department should focus on upcoming and promising businesses. While this looks broad and indeed needs time and resources, this structure is necessary for the future of business in Uganda particularly young and innovative enterprises.
Also read: Is Airtel on sale?
MTN Group started as a small company in South Africa. If we allow the practice of killing small businesses through unnecessary competition, we are denying another MTN to rise up. Just imagine if the MTN Group was ‘’killed’’ at an early stage, the more 1,000 Ugandans directly employed by telecom giant for example would be unemployed today, not forgetting the telecom’s contribution to the development of this country.
More importantly, the regulators and statutory bodies in Uganda need to be more firm and play their role effectively. Information has it that EzeeMoney management reported MTN Uganda anti-competitive behavior to the regulator. A year later, UCC is yet to respond. Never mind that it is less than two kilometers from ezeeMoney offices on Kampala road to UCC offices in Bugolobi.
Even after the judgment was passed, in favour of Ezeemoney, UCC has not responded in any way or issue a press statement for that matter.
Also read: Tracing the origin of Airtel woes in Africa
The indifferent response by the industry regulator is concern and one wonders why MTN or any other powerful company may fail a small firm.
The UCC earns 01 percent on gross profit of all telecom companies in Uganda. The MTN is the only profitable telecom company in Uganda, whose profits are billions of shillings; you understand the regulator’s rather lukewarm response.
We need to give credit for the great work so far done to our regulators. However, one wonders these regulators are playing their roles efficiently?
Outside the telecom industry, we see some Ugandans filling up our Lakes and swamps to create beaches and build houses in the middle of the lakes. And the regulator National Environmental Management Authority is looking the other side. However, when it comes to ordinary Ugandan, NEMA is quick to act.
With the increasing unemployment in Uganda and the need for the country to be self reliant, we need laws that give room to the young, innovative Ugandan entrepreneurs to operate and thrive. Just imagine if we had 100 firms like EzeeMoney starting every year in Uganda, How many jobs would be created? What will be the effect on the economy?
Over to you our Members of Parliament and all concern authorities.