3 months ultimatum  for Vodacom

3 months ultimatum for Vodacom

MASERU – THE Lesotho Communications Authority (LCA) has given Vodacom Lesotho three months to justify why its licence should not be cancelled.
This comes hard on the heels of revelations that relations between the authority and the mobile network company had soured over several compliance issues.

It is not clear when the show “cause letter” was issued and when the 90-day deadline lapses.
The LCA, in a statement on Sunday, said the show cause letter relates to Vodacom Lesotho’s alleged failure to appoint an independent external auditor.

The authority said since 2015 Vodacom Lesotho has had an external auditor whose partner is a relative of the company’s board chairman.
It said “the Companies Act prohibits a company from appointing a person related to an officer (director) of a company in a position to influence financial transactions or financial statements of a company as its auditor”.

“The explanation provided by Vodacom Lesotho revealed a deliberate intention to undermine compliance with the laws of Lesotho,” said the statement.

The LCA said Vodacom Lesotho is yet to respond to the show cause letter.
The LCA’s statement however shows that its tiff with Vodacom Lesotho goes beyond corporate governance issues. Some of those issues were revealed in a statement Sekhametsi Investment Consortium, the local company that owns 20 percent of Vodacom Lesotho, sent to its shareholders.

They include the company’s failure to pay its annual fees on time and provide reports on its broadband services to 90 schools under a Universal Service Fund (USF) contract with the LCA.
The authority fined Vodacom Lesotho M8.2 million for the delayed fees, but the company sued to block the penalty.
The High Court will hear the case next month.

On the USF the authority said Vodacom is yet to provide “compete and accurate” information on the provision of internet services to the schools.
Last week Sekhametsi claimed that Vodacom Lesotho had provided a detailed report on the contract.
The LCA also alleged that Vodacom Lesotho failed to comply with the rules of a promotion the authority had approved.

“LCA conducted a compliance audit and found that Vodacom Lesotho had failed to comply with their own declared business rules.”
Vodacom Lesotho has also issued a brief statement, saying it is “aware of media reports related to its operating licence conditions and is fully committed to addressing these through the relevant forums in due course”.
It also denied social media reports that the government had ordered it to stop operations in Lesotho.

Meanwhile, Communications Minister Thesele Maseribane has moved to dispel social media rumours that the government wants to kick out Vodacom Lesotho to make way for a new mobile network company.
Maseribane said the allegations are “baseless lies”.
“I am pleading with the public to handle these issues with utmost care as it affects the economy, people’s jobs and funds.”

Staff Reporter

 

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