Airtel Kenya has opted to pay Ksh 2 billion in an out of court settlement with the telecoms regulator for its expired licence. This brings to a close a seven-year legal battle it has been facing since 2015. The company had been at loggerheads with the Communications Authority of Kenya over its expired licence and a settlement has been reached for Airtel to pay 2 billion shillings over the next two years in order to be approved as an operator in the East African country.
Airtel had previously embarked on a legal tussle with the state but a recent directive says that telecommunication operators must have thirty per cent local ownership. This may have forced the company, which is one hundred per cent owned by India’s Bharti Airtel, to compromise and reach the settlement- as it exempts it from the rule.
Airtel is Kenya‘s second-largest telecommunications provider after Safaricom and has struggled to compete with the more dominant operator. Since its licence expired in 2015, it has been operating on that of yuMobile which it acquired in 2014. That expires in 2025.
The settlement of the long-standing dispute has been welcomed by the authorities in Kenya. “We have had this long-standing dispute with Airtel over the Essar transaction. The dispute has been there for seven years. But I am glad to report that we struck a deal and this is a major achievement for us,” said the director-general Ezra Chiloba, the director-general of the Communications Authority of Kenya. “Taxpayers are guaranteed of receiving about Sh2 billion in the next two years. They came up with a payment plan, which we agreed on. The idea was to have this matter resolved so that they can also start focusing on investing properly in this particular space.”
He adds that the deal was reached on February 11, and it will file a consent in court to withdraw the suit once Airtel pays the first instalment of the Sh2 billion this week.