Airtel Uganda paid the Ugandan government $77.79 million to renew its 20-year licence, its latest financial report shows.
The company also borrowed $4 million from Standard Chartered Bank to pay for its licence renewal in October 2020, the new disclosures in its full financial year ending March 2021 show.
This comes as the parent company, Airtel Africa, announced this week that it will spend $60 million to pay off its debt to the Tanzania government after bagging $159 million as part of the sale transaction of its telecommunications tower assets in Tanzania to SBA Communications Corporation.
According to its 2020 financial results, Airtel Uganda said it paid $77.78 million, in October 2020, to the Uganda Communications Commission (UCC) to renew its Public Service Provider License.“The licence period covers July 2020 to July 2040. A payment of $77.78 million has been made for the period covering July 2020 and June 2030,” it said, pointing to the fact that it will have to make additional payments for the 10-year difference.
The revelation of the payment, the highest in the East African Community, opens the lid to how much telecommunications firms in the region are paying governments for their licences.
In June last year, the region’s largest telecommunication provider Safaricom and its consortium that included Vodacom, paid the $850 million licence fee needed to start providing telecom services in Ethiopia.
In 2014, it paid $20.16 million to Kenya’s Communication Authority as its 10-year licence renewal fees. In 2017, it paid a further $25 million for a licence to provide 4G LTE servicesThe payment of the licence fee by Airtel Uganda is also an indication that President Yoweri Museveni’s administration had backed down on its demand for the Airtel unit to list on the Uganda Securities Exchange (USE) as part of its licence renewal.
In September 2018, UCC said it will introduce a requirement for all telecommunications firms to list on the Uganda Securities Exchange as a condition for obtaining or renewing a licence to operate in the country.“The UCC announced an intent to change the licensing framework in Uganda, which might include listing obligations and impact the licence fees payable and duration of the licence. Once the new licensing framework has been established, Airtel Uganda would be requested to submit an application based on the proposed framework,” the company said in 2019.
It added: “Although there is no legal or regulatory requirement for telecommunications operators to list on the Uganda […]