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2.3 GH2 Spectrum: Presidency keeps Akunyili, Ndukwe guessing

President Umaru Yar’adua, reported to have waded into the matter with a view to resolving the controversy, was expected to have made a final decision…

President Umaru Yar’adua, reported to have waded into the matter with a view to resolving the controversy, was expected to have made a final decision public on the issue last week, according to media reports, but he has remained silent.

Although both camps have abstained from making official pronouncements on the issue in the media on the orders of the Presidency, a sort of proxy battle of words has continued between supporters of the Minister and those of the NCC EVC. The controversy, apparently generated by differences in understanding of the Nigerian Communications Act (NCA) 2003, snowballed into a personality clash between Akunyili and Ndukwe, and was reduced to local politics by commentators and advertorials in the media. Sources close to Akuniyili have accused Ndukwe of sponsoring advertorials questioning the Minister’s capability to govern Anambra state, where both come from.

The controversy was fired by a petition Akunyili received on December19, 2008, from the National Broadcasting Commission (NBC) with reference to an advert placed by the NCC in one of the national dailies on December 15, 2008. The advert, which stated that NCC was going to auction more spectrum as decided by the National Frequency Management Council (NFMC) contained, according to NBC, erroneous information as the NFMC never made such a decision.

Previously, the NBC had written a letter to the EVC of NCC on December 11, 2008 protesting the latter’s public announcement that it had taken possession of the 2.3 and 2.5 GHz spectrums, which were previously used by licensees of the NBC. The NBC argued that “only the National Frequency Management Council (NFMC) has the authority to decide and make such a pronouncement”, and urged NCC to await the outcome of the meeting of a committee set up by both commissions on the direction of the then Minister of Information and Communications, Mr John Odey. The former Minister, according to NBC, directed both commissions to work together to fashion out modalities for the relocation of the users of the spectrums based on its protestations to him on the release of the 2.3 GHz spectrum to NCC.

The NFMC, in an internal memo to the Minister of State for Information and Communications dated was also said to have complained that the NCC was usurping its statutory functions. The memo, also stated that at its 10th regular meeting of March 29, 2007, the NFMC had directed NCC to stop unauthorised allocation of spectrum to itself.

In reply to the letter sent to it by NBC, NCC maintained that although it was allocated the bands as communicated by a letter written by the former Minister on October 31, 2008, and users were in the process of being relocated, it only made its announcement “to make the general public ware of the NCC’s processes for assignments in the future”.

The Minister also wrote a letter on February 18, 2009, to both NCC and NBC referring them to Odey’s letter, directing that the commissions should “henceforth desist from press publications on this issue”. But the NCC advertised the sale of the exclusive frequency bands on April 30, 2009, giving applicants a window of eight days, three of which were not working days, to pay N1.368 billion each for the licences. At the end of the exercise, three of the four slots advertised were bought. The fourth bidder, Galaxy Wireless, which had paid one percent of the amount, did not qualify.

This resulted in more petitions, with some interested parties alleging that the NCC intended to get a predetermined outcome. One of such petitions, which was addressed to the Minister and copied to the President, dated May 6, 2009, stated that the time frame given to applicants was “difficult if not impossible” to meet the dead line unless the funds were sourced were sourced from the bank where NCC had its account.

A source close to NCC told Sunday Trust that having been informed of the possible sale of the spectrum months earlier, any serious bidder would have been fully prepared. He also said the fact that three firms had been able to pay was enough evidence that it was not impossible, adding that even if the NCC had given a window of a hundred days or more, bidding would close the moment the advertised slots were paid for because it was on a first-paid-first-served basis.

He also denied the allegation that Galaxy Wireless was dropped for Multilinks Telkom, quoting a press statement released by the NCC on May 16 which said that “One of the applicants, Galaxy Wireless Ltd, did not pay the full fixed price and, therefore, did not meet the conditions for the offer of licence”.

This exercise, in the view of sources close to Akunyili, added to the flaw in the bidding process, prompting the Minister to instruct the NCC EVC to stop all the process of the sale of the 2.3 GHz spectrum until the President was fully briefed on the matter. They maintain that Odey’s release of the 2.3GHz spectrum to NCC, on which the commission relied to go ahead with the sale, was only in principle as the Minister had no power to release, transfer, or allocate any frequency because, according to the Part II, section 28 of the NCA 2003, the NFMC had the authority to “carry out bulk trans-sectoral allocation of spectrum to statutory bodies that are authorised by enabling laws to allocate spectrum to end-users”.

The Minister reportedly queried the NCC EVC for failing to abide by her directives and also informed the Economic and Financial Crimes Commission (EFCC) because, according to sources, it became “necessary to forestall further breaches and embarrassment to the government”. President Yar’adua subsequently met with the two government functionaries and directed that all parties involved meet and resolve the matter.

The meeting, held on May 22, 2009, reportedly resolved that neither the release of the frequency to NCC nor its sale by the commission followed due process, therefore, the whole process was cancelled.  This was said to have been conveyed to Ndukwe in writing on May 25. Also, the NFMC met on May 26 and officially released the radio frequency to NCC. But the NCC EVC, who was at the NFMC meeting, wrote a letter to the Minister the same day saying that the resolution of the May 22 meeting was contrary to the provisions of the NCA and the National Telecommunications Policy.

A source close to the NCC said Ndukwe did not refuse to abide by the directive of the Minister or the decision of the May 22 meeting. According to the source, by the time the Minister sent the NCC EVC a query, bidding had already closed and the transactions could not be cancelled as demanded.

In his letter of May 26, Ndukwe advised the Minster that any cancellation would undermine investors’ confidence in Nigeria’s telecommunications environment, and also warned that from the legal point of view, the cancellation might lead to litigation by the three winners. He urged the Minister to refer the matter to the Attorney General and Minister if Justice and that, because of the amount involved, “any reversal of the process will require the approval of the President”.

The source also said that the minutes of the May 22 meetings could not be tendered as evidence that even the Chairman of NCC, Alhaji Ahmed Joda, had agreed that due process was not followed in the sale of the 2.3 GHz spectrum, because it had not been read and ratified by the chairman and secretary of the meeting.

He also said the letter conveying to NCC the release of the 2.3 GHz spectrum to NCC was very valid because, as the chairman of NFMC, the Minsiter had every authority to do as she did.

However sources close to the Minister argued that the legal and financial concerns raised by Ndukwe were among issues dealt with at the May 22 meeting and that no reasonable judge would give judgement in favour of the companies that fraudulently paid, and that it is “irrelevant to refer the issue to the Attorney General of the Federation…when we are convinced beyond every reasonable doubt that due process was not followed ab initio”.

As things stand now, the President was reported to have referred the case to Chief Michael Aondoakaa who, according to media reports, has advised Yar’adua that Akunyili had not been vested by law with the powers to cancel licences issued by the NCC. Yar’adua, according to the reports, had asked Aondoakaa and the Aso Rock Villa counsel to review the transaction. All parties involved, as well as other stakeholders, are holding their breath waiting for the President’s pronouncement, which is expected to serve as the water to douse the flames.