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Thursday 28 March 2019
LegalBusiness
MTN lawyers say AGF’s legal arguments unacceptable and unknown to law
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ireworks continued today as MTN Nigeria and the Attorney General of the Federation and Minister for Justice continued their legal battle over the appropriateness of the latter’s demand for $2 billion in back taxes. While MTN maintained that the AGF was beyond his remit, the AGF sought to justify his demands. At a hearing in the Federal High Court in Ikoyi, Justice C J Aneke heard arguments relating to the substance of the AGF’s preliminary objection (from November 2018), the detail of which was only filed in court by the Attorney General late on March 25th, and which has yet to be served on MTN. The arguments did not focus on the substance of MTN’s suit, as the AGF’s preliminary objection that MTN did not commence legal proceedings within 3 months of the cause of action arising must first be addressed. MTN’s team of lawyers led by Chief Wole Olanipekun maintained that the AGF’s contentions were unacceptable and unknown to law. They argued that the cause of action actually crystalised when the AGF made a demand of MTN and threat-
ened the company with court action on August 20th. Previous correspondence from the AGF was acted upon in good faith by the company, he continued. He revealed that the previous correspondence had requested a self-assessment. He posited that the organization not only undertook the self-assessment but went ahead to submit the result of that process to the AGF’s office. The
assessment was undertaken by KPMG and showed clearly that no back taxes were owed to the Country. Despite this, the letter of August was still written. That letter heightened issues and led to the company seeking to protect itself from the unlawful actions of the AGF. The learned SAN further argued that to the extent that the letter has not been withdrawn, the cause of action continues to
exist. Therefore MTN remains within its rights to approach the courts. Counsel to AGF was asked directly whether the cause of action had been withdrawn (and so the demand itself withdrawn) but declined to respond. The Chief further posited that from the AGF’s pleadings his office had admitted the submission of MTN in so far as his main argument is not in response to the core issues raised by MTN, but to whether or not the AGF is protected in law from the consequences of his actions. The Chief argued that it is implicit in the AGF’s failure to address the substance of MTN’s case, that the AGF is aware it does not have the legal authority to take the action it has taken. Justice Aneke, after hearing the submissions of learned counsel to both parties, reserved ruling on the preliminary objection until May 7th. MTN Nigeria instituted the suit by a writ dated September 10, challenging the legality of the AGF’s assessment of its import duties, withholding of tax and value-added tax in the sums of N242 billion and 1.3 billion dollars. In the suit,
MTN claims that a revenue assets investigation allegedly carried out by the Federal Government on MTN over the period from 2007–2017 violates Section 36 of the Constitution of the Federal Republic of Nigeria. It also claims that the government’s August 20 letter stating the tax demand to the company contravenes the provisions of the section. The telecoms company seeks a declaration that the defendant (AGF) acted in excess of his powers by demanding an assessment, which MTN claims, usurped the powers of the Nigerian Customs Service to demand import duties and the powers of the Federal Inland Revenue Service to audit and demand remittance of withholding tax and valueadded tax. Over-reach by the AGF has been a consistent theme recently, with President Muhammadu Buhari already having ordered him to terminate a separate agreement through which he sought to collect supposedly ‘additional recoverable revenue’ from the International Oil Companies.
NBA-SBL launches banking & finance academy... Continued from page 21 pressed excitement at the collaboration with the NBA-SBL, stating that both organisations have had a long and rich history of partnerships, with Nigerian lawyers being the largest beneficiaries of all ILFA programmes within African jurisdictions. According to her, these benefits, include, internships and programmes for secondment. She said, “When my predecessor sought to launch the Intra Africa secondment programme in 2016, it was to Nigeria that she initially looked and we had six Nigerian law firms hosting lawyers from various West Africa jurisdictions. We have hopes of replicating this programme in future. “I am personally very excited about the Academy and about our blossoming relationship with the NBA-SBL which also extends to our online legal education platform called Angaza Africa law training. The partnership model we have with the NBA-SBL is a template for what we want to achieve in other parts of Africa. I believe that through relationships like this one ILFA
L-R, NBA-SBL Council Members, Chinyere Okorocha, Justina Lewa and Priscilla Ogwemoh, Chair, Media & Communication, Theodora Kio-Lawson, NBA-SBL Chairman, Seni Adio, SAN and ILFA Executive Director, Cynthia Lareine during the launch of the NBA-SBL/ILFA Banking & Finance Academy.
really is well positioned to build legal excellence & strengthen the rule of law and across Africa,” Lareine added. In closing, the ILFA director described Nigeria as a fantastic place with some of the most established and sophisticated law firms across Africa, which according to her has continued to attract international interest.
Speaking exclusively to BusinessDay, the Secretary of the NBA-SBL and Chairman of its training committee, Dr Adeoye Adefulu, disclosed that the Banking & Finance Academy would amongst other things, enable participants understand the structures of corporate borrowing, and how lenders raise money.
“They would also understand the general structure of a loan facility agreement and its key clauses; the reasons for and methods of transfers of loans by banks; an appreciation of the concepts of taking and perfecting security; as well as the reasons and methods of subordination; a fair knowledge of capital markets and types of
debt security; form and nature of a bond; tax matters relevant to banking lawyers, and a good understanding of the nature of derivatives and how the market in derivatives works after this training,” he said. The NBA Section on Business Law (SBL) is an arm of the Nigerian Bar Association, which engenders the development of commercial law and specialised commercial law practice in Nigeria. The Section currently has 20 committees focused on different sectors of the economy. Through its committees and strategic partnerships with government parastatals, legislative bodies, and private organisations, the section organises regular workshops, seminars and training programmes for its members, particularly young lawyers, with a view to promoting commercial and business interests in Nigeria. This is one of the primary objectives of the NBA Section on Business Law. As business advisors, the SBL Council and its members are committed to the well being of businesses and investments in Nigeria.