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Published On: Thu, Mar 12th, 2015

Cabinet approves closure of Telecel, Mandiwanzira

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CABINET has approved the closure of the country’s second largest mobile phone network, Telecel Zimbabwe, for operating without a licence, ICT minister Supa Mandiwanzira said Wednesday.

The fact Telecel did not have an operating licence was revealed in 2013 after rival Econet Wireless, having paid the government US$85 million, refused to interconnect with the company.

Said Econet at the time: “Econet Wireless was on 10 July 2013, awarded a renewed 20-year license following the expiry of the 15-year license issued in 1998.

“This license places certain strict conditions on our operations. Clause 5.2.2 of our license requires us to interconnect only with licensed operators.”

Authorities only moved against Telecel recently following a bitter shareholder dispute over the disposal of a 40 percent shareholding in the company for about US$20 million.

On Wednesday, Mandiwanzira told journalists in Harare that Telecel is now supposed to stop operating.

“Our position that Telecel should seize operations because they have been operating without a licence is the position that has already been adopted by Cabinet,” said Mandiwanzira.

“There is a committee in place to execute the decision of cabinet. That committee is being chaired by Honourable Chris Mushowe.

“Our position that Telecel has been operating without a licence and failed to honour local empowerment laws is the same position that has been adopted by Cabinet.

Telecel, the second largest mobile operator after Strive Masiyiwa’s Econet, has over 2,5 million active subscribers.

Mandiwanzira said in executing the decision, government will pay attention to the predicament of workers and subscribers who stand to be affected by Telecel’s closure.

“Government will be guided by the fact that there are employees there and that there are subscribers who might be affected. But our position as the ICT Ministry has not changed,” said the minister.

In January, the Postal and Regulatory Authority of Zimbabwe (POTRAZ) wrote to Telecel Zimbabwe Management announcing the withdrawal of the company’s operating licence due to non-compliance with local empowerment laws.

The country’s empowerment laws require foreign-owned firms to cede majority shareholding to locals.

A subsidiary of global telecoms firm Orascom Telecom Company owns 60 percent shareholding in Telecel Zimbabwe with the balance held by a group of indigenous entrepreneurs.

 

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