Stern legal actions will be taken by the Tanzanian Government against telecommunication companies that fail to float their shares on the stock market by the December 31 deadline.
With only three days to the deadline, the Minister of Works, Transport and Communication, Professor Makame Mbarawa, warned that the phone companies failing to list on the Dar es Salaam Stock Exchange (DSE) will be dealt with mercilessly.
The minister’s reminder came with only two companies – Vodacom and Tigo – having so far heeded the listing requirement as per the Electronic Postal and Communications Act, 2016. There are seven landline and mobile phone operators in the country so far – Airtel, Smart, Halotel, Tigo, Tanzania Telecommunication Company Limited (TTCL), Vodacom and Zantel.
According to the Markets and Securities Authority (CMSA)’s Principal Public Relations Officer, Mr Charles Shirima, it takes about three weeks for the company to get the Initial Public Offer (IPO) and listing on DSE after submitting an application that meets conditions. He elaborated that the three week period is for CMSA to review the submitted application before approving it.
With the exception of Vodacom and Tigo, all the other firms are at the risk of getting punished.
While speaking to reporters in Dar es Salaam Prof. Mbarawa stated that among other punishments, the companies will have their licenses revoked.
“Registering telecommunication companies with DSE would enable majority Tanzanians to own the money minting businesses, and I advise citizens to effectively participate through buying shares,” he added.
The new Act requires that network facilities, network services and application services licensees, including mobile operators, to list on the stock market, with 25 per cent of their shares given to the public.
During the 2016/17 budget debate, the Minister of Finance and Planning, Dr Philip Mpango, explained that the law would help the government to trace the revenues of the telecom companies and enable Tanzanians to own shares in the sector.
Tanzania is the second largest telecoms market in East Africa behind Kenya, with a penetration of 79 per cent of the total population, with subscribers estimated at 40 million in 2015. In the past five years, the landline subscriptions decreased by 22 per cent, from 174,511 in 2010 to 142,819 in 2015, while mobile subscriptions rose by 89 per cent, from 21 million in 2010 to almost 40 million last year.
