UCC Cracks Down on 4,000 Unlicensed Wi-Fi Operators, Cites Shs148 Billion Tax Loss

The Uganda Communications Commission (UCC) has identified around 4,000 individuals and businesses operating public Wi-Fi services without proper authorization. The regulatory body estimates that this widespread unlicensed activity results in an annual tax revenue shortfall of Shs148 billion, alongside significant risks to the nation’s telecommunications infrastructure.

UCC Executive Director Nyombi Thembo described the practice of reselling internet services without licenses as an “economic crime,” asserting that these operators do not genuinely offer affordable internet. Instead, they allegedly purchase high-speed internet from licensed providers and then resell it to the public at lower rates, bypassing regulatory approvals and tax obligations.

This practice creates an unfair competitive landscape for licensed telecommunications companies, which invest heavily in network infrastructure and adhere to regulatory requirements. Licensed providers typically charge around Shs2,000 per gigabyte, inclusive of taxes and operational costs, while unlicensed operators are reported to charge approximately Shs1,000 for the same data volume.

Beyond the financial implications, the UCC has raised serious concerns regarding consumer protection, national security, and public safety associated with these unregulated Wi-Fi hotspots. Users may not receive guaranteed service quality, lack accessible complaint mechanisms, and face risks of data misuse. Furthermore, the unauthorized installation of equipment, sometimes on electricity poles and existing telecom infrastructure, poses electrocution risks and interferes with essential maintenance.

MTN Uganda’s CEO, Sylvia Mulinge, has called for a sustainable approach to internet pricing. While acknowledging the growing demand for affordable data, she stressed that efforts to lower costs should not compromise the necessary investments in network quality and reliability. Mulinge urged a balanced strategy that considers both consumer affordability and the financial viability of maintaining robust telecommunications infrastructure.

The UCC is collaborating with the Uganda Revenue Authority to address the importation of equipment by unlicensed operators and is considering enforcement measures, which could include equipment seizure. Operators are urged to regularize their services or cease operations that fall outside regulatory compliance.

Source: https://nilepost.co.ug/news/377943/ucc-targets-4000-unlicensed-wi-fi-operators-over-shs148bn-tax-loss-claim