Uganda Communications Commission has granted conditional approval to Africell’s exit plan from Uganda, requiring that the outgoing service provider settle outstanding debts and liabilities and comply with data protection and privacy, environmental, and labour laws, among other conditions.
Through multiple letters exchanged, especially in July and August 2021,UCC offered detailed guidance on how to manage the exit process. Africell made commitments to the Commission to comply with the conditions set before exiting.
“The Commission has no objection to Africell’s proposed date of 8th October 2021 as the date for cessation of operations following the one-month notification of customers and staff effective 8th September 2021,” said Ag. Executive Director Irene Kaggwa Sewankambo, in one of her letters to the Africell CEO.
“Africell must, however, strictly adhere to the commitments it made to the Commission with respect to ensuring that all customers’ claims and complaints are concluded before the actual date of cessation,” she added in the letter dated 7th September 2021.
In a press statement issued on 9th September, UCC explained that Africell, which entered the Ugandan telecom market in 2014 after acquiring majority shares in Orange Uganda Limited, had now decided to consolidate its business in other parts of the world where they have a competitive advantage.
The Commission said pre-exit conditions are intended to ensure that the interests and rights of Africell’s customers, agents, employees, trade creditors and the Government of Uganda are safeguarded before the exit.
The Commission added in its statement that it is working with sister agencies to ensure Africell complies with the various laws, including the National Environment Protection Act and the Data Protection and Privacy Act.
In that regard, UCC demanded that Africell submit written evidence of settlement of all its creditors, as well as confirmation of settlement of all staff claims (if any) and completion of the staff termination processes by 15th September 2021.
The Commission advised all persons with claims against Africell to immediately contact the company to work out arrangements to settle their claims before the 7th of October 2021.
On the possibility of Africell migrating its business customers to other licensed providers, the Commission guided that Africell would have to ensure that its existing customers are informed of their right to migrate to any other licensed operator of their choice or consent to whichever provider they are moved to.
The Commission further guided that any such arrangement to facilitate the continued provision of services to Africell’s customers after 7th October 2021 must align with the existing legal and regulatory framework.
To comply with Uganda’s data protection and privacy laws, the Commission advised Africell to seek the express approval of the National Data Protection office at NITA-U before concluding its transfer of customer information to any other entity.
UCC is cognisant that, like other telecoms, Africell is in possession of subscribers’ data that must be protected and the subscribers’ privacy secured in line with the Data Protection and Privacy Act 2019.
Besides, as a key stakeholder in the E-waste Management value chain, the Commission promotes adequate and sustainable disposal of electrical and electronic equipment (EEE) – a cause that gained more traction with the launch of Uganda’s first National E-waste Management Centre in June 2021.
“In view of the above outstanding issues, the Commission maintains its CONDITIONAL APPROVAL of Africell’s exit plan, subject to Africell meeting the outstanding conditions stated hereinabove and in the letter of 17th August 2021,” the Ag. Executive Director wrote.
Allaying fears about the health of Uganda’s communications sector in view of this development, the Commission assured all stakeholders that Uganda’s communications sector remains resilient and attractive to local and foreign investors.
“Sufficient measures have been instituted to ensure that Africell’s exit does not negatively affect the stability and integrity of the communications sector in Uganda,” the Commission said in its statement.
Risks to the sector’s resilience and integrity would manifest in debts that impact the financial health of other stakeholders in the telecom ecosystem or compromise the continuity of services.
Notwithstanding Africell’s impending exit, the recently released market performance report shows robust growth across the communications sector over the last six months.
Highlights of the quarterly report produced by the Commission indicate that telephone subscriptions grew from 28.3 million at the end of March 2021 to 28.9 million at the end of June 2021.
During the same period, the number of smartphones jumped from 8.1 million to 9.7 million, as internet subscriptions grew from 21.5 million to 21.9 million.
The report also shows robust growth in the mobile money business, with registered mobile money subscriptions rising from 30.5 million in March 2021 to 31.3 million in June 2021.