VCL saga sucks in First Lady

KANANELO BOLOETSE

MASERU – First Lady ’Maesaiah Thabane has been sucked into a raging row between the Lesotho Communications Authority (LCA) and mobile telecommunications giant, Vodacom Lesotho, over the latter’s alleged violation of regulatory compliance regulations.

LCA announced in February it had given Vodacom a 90-day ultimatum to justify why it should be allowed to keep its licence after it “deliberately undermined compliance with the laws of Lesotho”.

The announcement, which came amid growing speculation that a high-level campaign was under way within the government to persecute Vodacom and ultimately revoke its licence, caused widespread confusion across the country, as panic mounted over the future of the company.

Vodacom is the leading mobile communications operator in the country. It is a subsidiary of the Vodacom Group Limited, a South African mobile communications company, providing voice, messaging, data and converged services to over 55 million customers.

Public Eye can report that Vodacom Group dispatched an envoy to Lesotho last week to intervene in the crisis. The group’s non-executive chairman, Jabu Moleketi, came to Lesotho where he met with the communications minister Thesele ’Maseribane, the LCA and the First Lady ’Mesaiah Thabane, Public Eye has established.

So secret was Moleketi’s trip, it seems, that Vodacom Group declined to confirm or deny whether or not he visited Lesotho, but the LCA has confirmed it. “The representatives of Vodacom Lesotho’s major shareholder were in Lesotho last week where they met with officials of the LCA. Discussions were on regulatory and compliance issues,” LCA public affairs manager, Tšiu Tšiu, said in an email.

Vodacom Group holds an 80 percent stake in Vodacom Lesotho, with the remaining share held by the Sekhametsi Investment Consortium, a grouping of local businesses. ’Maseribane also confirmed to this publication on Wednesday that Moleketi was in the country but did not reveal what he was here for. He indicated that his meeting with Moleketi was just a courtesy call.

“I have meetings every day with different people. Why are you asking me about the meeting with Mr Moleketi specifically? What is your interest in this particular meeting? It was just a courtesy call,” he said. When contacted this week, Vodacom Group stated it was a long-standing tradition for its chairman to attend meetings with the management of the group’s subsidiaries.

“In the normal course of business, the Vodacom Group Chairman attends meetings with Vodacom management as part of our stakeholder engagement programme. Vodacom is not at liberty to confirm or discuss engagements of this nature,” Vodacom Group spokesman, Byron Kennedy, said in an email.

Office of the First Lady’s spokesperson, Silas Monyatsi, professed ignorance over Moleketi’s visit. “I am not even aware that Mr Moleketi was in the country last week. The office of the First Lady is not aware of any meeting the First Lady and Mr Moleketi not unless it was a private meeting that took place at the State House,” Monyatsi said. Moleketi is a former SA Deputy Minister of Finance in the cabinet of President Thabo Mbeki, from 2004 to 2008.

Following the resignation of Mbeki, Moleketi was among those members of the Cabinet who tendered their resignations on September 23, 2008. He joined the Vodacom Board in November 2009 and was appointed non-executive chairman in July 2017. Following his visit to Lesotho, Basotho National Party (BNP) deputy leader, Machesetsa Mofomobe told a BNP rally in Berea last Sunday that there was a secret plot to remove ’Maseribane from the ministry of communications and replace him with a “stooge” that will protect Vodacom from LCA’s rage.

Mofomobe told the BNP rally that he was aware of “a clandestine meeting at Maseru West between one Vodacom representative from South Africa and some people in the government who want ’Maseribane removed from communications ministry”, but fell short of definitively mentioned names. ’Maseribane is the leader of BNP, the third largest partner in the four-party coalition government.

Other parties in the coalition include All Basotho Convention (ABC), Alliance of Democrats (AD) and Reformed Congress of Lesotho (RCL). Public Eye last month exposed details of an explosive communiqué to the shareholders of Sekhametsi Investment Consortium, which revealed a widening rift between Vodacom Lesotho and the LCA.

LCA is a statutory body, established in June 2000, with the mandate of regulating the communications sector in Lesotho. This mandate entails, among others, promoting fair competition, approving tariffs and granting licences to operators.

The Sekhametsi communiqué revealed that in August 2019, LCA issued a non-compliance order against Vodacom alleging that the company had not complied with the payment of regulatory fees for the financial year 2018/2019. For this alleged noncompliance, Vodacom was charged a penalty of M8.2 million.

Sekhametsi directors charged in the communiqué that between August and December 2019, LCA targeted Vodacom in various press releases over radio and print media. “The net effect of this unusual step by the LCA, which did not accord Vodacom Lesotho the right of a hearing, has resulted in the following; reputational damage and further deterioration of relations between the regulator and Vodacom Lesotho,” the directors said.

LCA did not take Sekhametsi’s accusations lying down. It released a statement announcing that it had given Vodacom a 90-day ultimatum to justify why it should be allowed to keep its licence after it “deliberately undermined compliance with the laws of Lesotho”.

It said it had hit Vodacom with a four-count indictment covering allegations ranging from failure to pay licence fees on time to failure to comply with tariff conditions. The statement was a damning portrait of Vodacom, which was depicted as a rogue operator which has failed to comply with its own declared business rules, failed to hire an independent auditor and failed to account for a M900 000 universal service fund allocated to it to provide internet in 150 high schools – 30 in 2016, 60 in 2017 and 60 in 2018.

LCA said from as far back as 2015, “Vodacom directors and shareholders failed to appoint independent auditors as specified in section 97(2) (g) in that the external auditor is a relative of the chairman of the board of Vodacom”.

Section 97(2)(g) of the Lesotho Companies Act, 2011 prohibits a company from appointing a person related to an officer (director) of a company in a position to influence financial transactions or financial statements of a company as its auditor.

“The explanation provided by Vodacom Lesotho revealed a deliberate intention to undermine compliance with the laws of Lesotho,” LCA said. It said in the light of the seriousness of the matter, it requested Vodacom “to provide written reasons within 90 days why its Unified Licence cannot be revoked”. It added: “The LCA is still waiting for submissions from Vodacom Lesotho.” It also accused Vodacom of “failure to pay licence fees on time” and “failure to meet Universal Service Fund obligations”.