Econet hit with $91,000 fine in Lesotho


Econet Telecom – Lesotho (ETL) has been been fined US$ 91,000 by the Lesotho Communications Authority (LCA) for delaying to submit its license renewal application.

LCA expects renewal applications to be filed two years before their date of expiry. This means Econet Lesotho should have filed for a new license before October 2019. Their currently license expires in 2021.

CEO of LCA, Mamarame Matela, said that the telco will have upto the end of December 2020 to pay the fine.

Speaking to the media, Matela said, “Econet was unable to submit its application for renewal of its licence as expected on 11 October 2019.

“There is a requirement in terms of the rules for a licensee to submit its application two years before the end of the existing licence.

“Econet subsequently applied for condonation that they are allowed to submit their application late and after lengthy deliberations, they were allowed to do so by the LCA board on condition they pay a penalty of M1, 5 million by the end of December 2020.

“Econet was also unable to submit its audited financial statements in terms of the conditions of its licence 90 days after the end of their financial year, which ended in February 2020. The matter is still before the authority.”

According to the CEO, ETL acquired a multi-million dollar loan from the Lesotho government. She demanded that the telco explain its plan to service this loan in the event the license is not renewed. Matela also requested an explanation on how the loan funds were utilised towards the expansion of its infrastructure.

Puleng Masoabi, ETL public relations manager, said, “There is nothing much to say except that we are already addressing these issues with the LCA.”

Ms. Matela added that the sector would soon be opened up to allow other aspiring communications services providers to apply for licences to end the ETL-Vodacom duopoly in the sector. She added that the Lesotho parliament is finalising legislation to support the new licensing regime.

The fine is a small penalty compared to the roughly US$ 10 million paid by Vodacom Lesotho for flouting a selection of licensing regulations.

Following such strict action, various stakeholders have accused the LCA of heavy-handedness, and suggested that the imposition of such penalties will cripple the country’s mobile telecommunications sector.