Tanzania to review contentious share sale clause

18 Jan 2010

The government of Tanzania has announced it is reviewing a controversial clause in the proposed Electronic and Postal Communication Act 2009, which is due to be tabled before Parliament later this month, which compels domestic mobile operators to sell shares worth billion of shillings to Tanzanians. The Citizen newspaper reports that the move should hopefully avert a major clash with cellcos disgruntled at the plan. The clause in question requires mobile operators to float shares on the Dar es Salaam stock market after three years of operation. However, cellcos are bitterly opposed to the plan and have this week petitioned the regulator, the Tanzania Communications Regulatory Authority (TCRA), to scrap the idea. Yesterday the country’s Communication, Science and Technology minister, Prof Peter Msolla, said the government would review the contentious clauses before finally tabling it before Parliament. As a caveat though he warned that not all of the clauses under dispute would be dropped as some are designed to safeguard public and national interest. The cellcos’ filing to the TCRA called the mandatory listing ‘unconstitutional’ and contradictory to the Company Act and the Capital Stock Market and Securities Act. For its part, the government is keen to stake a claim in the lucrative telecoms market whose phenomenal growth in recent years has amassed millions in profits for telcos.