MTN floors Katuntu in Commercial court over Mobile Money services



High Court Judge Justice Christopher Madrama on Friday dismissed a case in which Bugweri Member of Parliament Abdu Katuntu had sued MTN for allegedly operating a financial services (Mobile Money) without being licensed as a financial institution.

Katuntu had claimed he was acting in exercise of his constitutional duty under Article 17 of the Constitution, instituting a public interest litigation. He was seeking court’s intervention to declare MTN and other operators who are dealing in mobile money transfer services as amounting to engaging in financial services and as outside the scope of their Operator’s licences as telecommunications operators. Further sought for declarations, that such provision of mobile money services by MTN, not being a regulated financial institution is illegal in the circumstances and as such should be compelled to declare and refund all moneys and profits accrued under the purported illegal practices.

Before the hearing of the case, the lawyers representing MTN (U) Ltd; Joseph Matsiko, Bruce Musinguzi and Idoot Augustine, all from Kampala Associated Advocates (KAA), did raise objections as to the propriety of the case against their client and further challenged the capacity of Abdu Katuntu to institute the case against their client. The judge upheld the preliminary objections raised by MTN lawyers  who argued that Katuntu did not show any individual right that he enjoyed in regard to the mobile money services, which right right had been violated by MTN. The disclosure of such a right, they argued was a fundamental pre-condition for the success of any suit. They further argued that, Abdu Katuntu had failed to show court any violation of any constitutional right or provision by MTN, which would have brought the case under public interest litigation.

The judge also based decision on the fact that there was no proof that Katuntu had explored other avenues to pursue his or public rights by reporting the matter to Police or DPP. He advised Katuntu as a legislator to explore alternative avenues through bringing any such activity of mobile money within the express provision of the Financial Institutions Act, which duty lies with Parliament as the Supreme Legislative Organ. Court held that, declaring MTN mobile money as a financial service, would amount to usurping parliament’s constitutional duty and therefore breaching the Constitutional principle of separation of powers.

Justice Christopher Madrama concluded that there is no constitutional right or duty that MTN has violated by operating MTN mobile money transfer services. He therefore dismissed the entire case against MTN and other Telecommunications Operators, for failure by Hon. Abdu Katuntu to disclose a cause of action against MTN.

Idoot Augustine, one of MTN Lawyers who handled the case expressed satisfaction with the ruling.

“I think we are satisfied with the outcome of this case. Court has upheld all the grounds that we had raised in opposition  and that affirms that MTN is carrying out its operations within the confines of the law”, he said.