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28.06.2005 Business & Finance

Westel Starts Negotiations With Gov't

Ghanaian Chronicle

As Western Telesystems Company Limited (WESTEL) continues to pursue its action against the Government of Ghana and the National Communications Authority (NCA) at the UNCITRAL arbitration for causing financial loss to the company, sources close to the company have indicated that Westel has started negotiating with the government to resolve the problem amicably for the company to rejuvenate its business.

Westel is demanding from the government of Ghana, $190 million in compensation for the damage it has caused Westel after eight years of relative passivity from Westel.

The NCA had failed to grant license to Westel to operate a mobile network.

Westel did this apparently because it had no other choice open to it.

Westel is contesting a radio frequency fee of $27.5 million being demanded by the NCA to make the total fee required by government $52.5 million, excluding the $10.1 million it had paid originally for the Second National Operator (SNO) license.

NCA is said to have jumped the licence fee of 1996 to the $71.146m penalty in 2001, skipping conveniently over its fundamental regulatory failures towards Westel in the intervening period.

"It is a joke to say Westel has failed while other operators have done well, as NCA has made a material contribution to Westel's alleged failure.

"Westel has not failed. Rather NCA severely blocked its start-up and operation but later turned around and fined Westel for failing to perform," Mr. William Taylor ever stated, adding: "NCA knows very well that Westel has never made a profit, and has never paid a dividend to its shareholders, and that NCA itself by its unfairly punitive behaviour, has driven Westel's value down to zero.

Westel, late last year, said that NCA was far from being fair and even-handed: "The international arbitration panel is going to receive ample proof that NCA has not been fair, even-handed or transparent in its dealings with Westel," it said.

Indeed, Westel will show that NCA's behaviour has been calculated to make Westel give up and quit the county in despair.