In 2015, we told you that telco Airtel Kenya was yet to renew its license with the Communications Authority of Kenya. Instead, Airtel was using the Essar Telekom YU’s, whose operating license and subscribers it acquired, in a buyout deal of Essar’s operations with rival Safaricom. Airtel Kenya was first issued with the license in 2000 for 15years, when it launched operations locally as Kencell. The company has over the years changed ownership and subsequently re-branded as Celtel, then Zain and now Airtel Kenya. Communication Authority charges included renewal license fee of Kshs 2.3 Billion, Kshs. 30.2 million for initial annual operating fees, outstanding frequency fees of Kshs 24.9 million and a penalty payment of Kshs 1.5 million from Airtel.
The Communications Authority of Kenya was reviewing certain factors including whether Airtel Kenya can continue to use YU’s license in its operation or if the use of the continued use of the license complies with law. The board eventually agreed to have Airtel pay the license fees. Airtel has now lodged an appeal with the Ministry of ICT, seeking to be exempted from paying the fees. Airtel cites an agreement made with the Communications Authority of Kenya when acquiring Essar which exempted it from license renewal.
According to Business Daily, the Kenya Revenue Authority (KRA) is seeking Kshs. 531 million in taxes from Airtel for its first two years of operation in Kenya. The amount in taxes arose from the purchase of the operating license when it begun operations in Kenya as Kencell. KRA has since gone to court seeking to have the telco compelled to pay the debt.