Judge rules mobile money operations by MTN, others as illegal

An Ugandan court has pronounced that the mobile money business being operated by the five major telecommunication companies in Uganda is illegal.

Commercial court Justice, Christopher Madrama made the pronouncement in Kampola on Friday.

The judge had made the pronouncement during a a case where BugweriCounty MP AbduKatuntu had filed a petition seeking for a declaration to have mobile money regulated under the financial institutions act.

Katuntu wanted a declaration that the mobile money services are currently operating outside the license issued to them by the Uganda Communications Commission (UCC) to operate as telecommunication companies.

In the suit, he alleged that the mobile money operators; MTN, Warid, UgandaTelecom, Airtel and Africell are registered as telecommunication companies, not financial institutions.

Justice Madrama agreed saying, “MTN is not a financial institution. It needs to obtain a license from either bank of Uganda or any other commercial bank to carry out financial businesses and operate mobile money.”

However, Madrama dismissed the case saying it was instituted in the wrong court, adding the plaintiffs should have raised the issue before a tribual setup by UCC to handle such matters.

He said under the Uganda Communications Act, Parliament ruled under section 75 to establish a tribunal and an office of a technical advisor to determine matters under the Act. The jurisdiction of the tribunal is provided for under section 79 and includes the right to hear all matters relating to the telecom services.

In a related development, an Ugandan pop singer Panado wa Basajja also faces a 10-year jail term for allegedly producing a raunchy promotional video for her song, ‘Ensolio Yange’ (Medicine for Men).