Operator stops Macra over licence

–Kunkuyu’s directive to negotiate licence faulted
–Interested party obtains injunction to stop process

A February 15 2013 directive from a former minister of Information to Malawi Communications Regulatory Authority (Macra) to negotiate a licence deal with a specific mobile phone firm has landed the regulator a lawsuit.
The applicant, Ian Kanyuka of TalkAWE! Limited, obtained an injunction at the High Court in Blantyre on May 15 2015 that effectively stopped Macra from dealing with Lacell Pvt Limited of Singapore regarding award of a fourth mobile phone licence.
According to court documents, former Information minister Moses Kunkuyu directed Macra to negotiate with Lacell Pvt Limited about the awarding of the licence despite Lacell coming fifth—second from the bottom—during the bidding process.

Kaphale the current Attorney General (AG)—who advised Macra that it was going to be unconstitutional to implement the minister’s directive.
Kaphale the current Attorney General (AG)—who advised Macra that it was going to be unconstitutional to implement the minister’s directive.

The High Court granted the injunction against Macra, ordering the regulator not to re-open negotiations with Lacell to the exclusion of all other applicants who had applied in 2008 and other potential applicants.
The court also granted the application sought for judicial review of the matter and that hearing be expedited.
Despite Macra’s fears as communicated in writing on April 3 2013 by the Macra board to Kunkuyu that the directive could attract legal suits, Macra succumbed to the minister’s pressure and wrote to Lacell, inviting them to the negotiating table.
Macra’s decision to engage Lacell was also against a legal opinion it sought from the then private practice lawyer Kalekeni Kaphale—the current Attorney General (AG)—who advised Macra that it was going to be unconstitutional to implement the minister’s directive.
During the bidding for the fourth mobile firm to operate in Malawi, Macra in 2008 advertised for a mobile telecommunications service, inviting operators to apply, and six applied including Lacell.
According to court documents filed at the High Court, Lacell came fifth with a 60.63 percent score.
Macra stated that a preferred bidder must score above 80 percent, and top on the list after the results, according to court documents, was Millicom International Cellular which scored 90.56 percent, Expresso Telecom Group Limited at 88.32 and MTS Viva Cell Consortium that scored 81.96 percent.
A local firm, Forward Ventures Limited, came last, at sixth position after it scored 36.94 percent and on fourth position was Comium Services SARL of Lebanon that scored 75.52; even beating Lacell, the firm the Malawi government wanted Macra to award the licence and allow it roll out its services.
The court documents say at a meeting in Lilongwe on February 15 this year, the incumbent Information Minister Kondwani Nankhumwa met the Macra board to discuss a number of issues, including the controversial licence deal.
At the meeting, the Macra board detailed about the Lacell issue, as the court record would show, explaining that Millicom International Cellular, which came tops after the bidding process, also emerged as a successful bidder when Macra advertised for a third mobile licence but failed to submit powers of attorney document.
The third mobile phone licence, following Millicom’s failure to complete the process, was re-advertised.
The Macra board explained that the evaluation team, therefore, recommended that Expresso Telecom Group be awarded the fourth mobile (Cellular) licence following successful licence negotiations with Macra.
The team recommended that Millicom be considered for the award of the licence in the event that negotiations with Expresso collapsed.
Macra explained that after a series of meetings between the board and government, it was resolved by the board between November 19 and 20 2009 to endorse government’s decision that the fourth mobile licence should be re-advertised.
Macra, according to court documents, explained that both Expresso and Lacell did not apply and the locally owned Celcom was the successful applicant.
The Macra board said the Lacell issue resurfaced in 2013, explaining that by letter to the Macra director general dated February 15 2013, Kunkuyu wrote informing Macra that government had approved a new policy on award of mobile licences, the crux of which was that entry restrictions for new investors would be kept to a minimum.
It was at this point that the Macra board, sceptical of legal suits it was going to likely face, met on April 2 2013 and resolved to inform the minister the challenges the authority was going to face in implementing the ministerial directive.
Kunkuyu, in a letter dated April 5 2013, told the Macra board and management, warning them to stop making reference to the level of scores the applicants scored during the evaluation.
He ordered Macra to immediately resume licence negotiations with Lacell not later than week beginning April 8 2013, declaring that the directive was not negotiable.
In his legal opinion, Kaphale told Macra that the 2008/09 negotiations with Lacell were properly terminated and Lacell did not have any viable legal claim against Macra with respect to the termination.
The Macra board told the new Information minister at the Lilongwe meeting that the regulator, following instructions from the ex-minister, requested Lacell to submit both technical and financial plan before February 22 2013, which it had not done by the date of the Lilongwe meeting on February 25 2015, thereby breaching the time limits that were set.

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