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Senegalese mobile base tops five million users; Tigo fights for licence

12 Nov 2008

At the end of September Senegal was home to 5.01 million mobile users, thanks to the net addition of 289,000 new users in the third quarter, a cellular penetration rate of 47.35%. France Telecom unit Orange Senegal ended the period with 3.188 million customers, up from 3.042 million at 30 June, to lead Millicom International Cellular (MIC’s) local unit Sentel GSM (Tigo), with 1.822 million (up from 1.679 million).

MIC is fighting the government’s threat to remove its operating licence, announced at the end of last month. The Senegalese unit was granted a 20-year licence by a former administration in 1998, prior to the enactment in of Senegal’s Telecommunications Act in 2002. Since then the incumbent governments have acknowledged the validity of Sentel GSM’s concession, but have repeatedly requested that it renegotiate the terms of the licence. Although Sentel has said it would be willing to comply with the state, a stumbling block is the cellco’s insistence that any renegotiation include enhancements to the licence – such as the rights to offer 3G voice and data services. In the wake of the government’s ultimatum, MIC has restated its commitment to seek an amicable compromise but confirmed it is also considering its legal options in the light of the government’s statement.

Yesterday MIC announced that its subsidiaries Millicom International Operations (MIO) and Sentel GSM (Tigo), have instituted arbitration proceedings with the International Centre for the Settlement of Investment Disputes (ICSID) against the Republic of Senegal under provisions of Sentel’s licence and international law. In a statement the group said that MIO and Tigo are seeking compensation for the purported expropriation of the Senegal licence and monetary damages for breach of the licence. In response, the Senegalese government yesterday instituted court proceedings against MIC and Sentel, alleging that it has cancelled Sentel’s licence and is seeking damages against the pair ‘under various theories’ as MIC puts it.

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