MTN Nigeria, one of the country’s leading telecom companies, is currently in a heated dispute with the Osun State government over a Right of Way (RoW) fee and penalty totaling over N1 billion.
According to documents obtained by Nairametrics, the Osun State government is demanding that MTN pay N945 million in RoW fees for 270 kilometers of fiber optic cables. Additionally, the state is asking for a N100 million penalty for what it claims is non-payment of the fee.
However, MTN argues that it does not owe this fee. The company says it entered into a legal agreement with Odua Infraco, a company partly owned by the Osun State government and licensed by the Nigerian Communications Commission (NCC). MTN claims it has already made all necessary payments to Odua Infraco before laying its cables in the state.
Odua Infraco holds the rights to lay fiber optic cables across 1,031.44 kilometers in four states: Osun, Oyo, Ondo, and Ekiti. MTN’s contract with Odua Infraco covers the fiber infrastructure in these areas.
The conflict between MTN and the Osun State government began when the state appointed Global Transaction Nigeria Limited (GTNL) as a consultant to manage RoW charges. This appointment came even though Odua Infraco was already handling this responsibility.
MTN’s relationship with Osun State had been smooth until September 14, 2023, when it received a letter from GTNL. In the letter, GTNL introduced itself as the Technical Consultant to the Osun State Ministry of Environment on telecommunications infrastructure and informed MTN of its role in overseeing telecommunications infrastructure in the state.
GTNL also informed MTN that it had been tasked by the Osun State government to inspect, audit, and monitor installations within the state to ensure they complied with environmental laws and safety standards.
In December 2023, GTNL sent another letter to MTN, notifying the company of an ongoing investigation into Odua Infraco’s activities in Osun State. GTNL alleged that Odua Infraco did not have the legal right to lay fiber optic cables in the state and requested a meeting with MTN.
During the meeting, GTNL informed MTN that there were plans to terminate Odua Infraco’s RoW and Easement Agreement with Osun State due to alleged breaches, including the failure to remit fees to the state, violations of environmental laws, and the illegal awarding of RoW to telecom operators like MTN.
However, Odua Infraco responded to these claims in January 2024, insisting that its agreement with the Osun State government was still valid.
Despite these back-and-forth exchanges, MTN received two Demand Notices from GTNL in March 2024, asking the company to pay N945 million for its fiber cables, plus a N100 million penalty.
While GTNL continues to demand over N1 billion from MTN, the matter has now been brought to the attention of the NCC’s Compliance Monitoring and Enforcement Department. The NCC is working to resolve the issue, which threatens to disrupt its infrastructure project.
The NCC had previously licensed Odua Infraco under its InfraCo project, aimed at fast-tracking the deployment of fiber optic cables across Nigeria. However, disputes like this one between MTN and Osun State highlight the broader challenges facing the telecom sector, especially as state governments increasingly view RoW charges as a source of revenue.
Although there is a federal policy that sets a harmonized RoW charge of N145 per linear meter to encourage the rollout of fiber infrastructure, only about seven out of Nigeria’s 36 states have complied with this policy. As the industry continues to face these obstacles, the NCC’s role in mediating disputes and advocating for a more favorable operating environment for telecom operators is crucial.
