Legal team size: 11

What are the most significant cases and transactions that your legal team has recently been involved in?

Safaricom Ethiopia, along with its subsidiary Safaricom M-Pesa Mobile Financial Services, is actively engaged in telecommunications and mobile financial services. The company launched its commercial operations in October 2022 for its telecom business and in August 2023 for its M-PESA business. As the head of the legal and regulatory team, I have overseen a range of initiatives to ensure the successful launch and operation of these businesses.

Telecom Business

In the realm of telecommunications, one of our key achievements has been the development of over 10 standard foundational contracts. These include agreements for Master Purchase Agreements (MPA), Service Level Agreements (SLA), construction and consultancy services, hotel accommodation (HOTAC), device purchases, key account partnerships, and distribution. These contracts provide a solid foundation for our engagements with various vendors. Beyond these, we also draft non-standard contracts for specific purposes and meticulously review contracts drafted by counterparties to ensure they align with our legal and operational standards.

Customer satisfaction and legal compliance are at the core of our operations. For every product we launch, we ensure that customer terms and conditions are clear and user-friendly, translated into various local languages, while still protecting our legal rights. To date, we have drafted and implemented over 30 sets of customer terms and conditions, supporting their translation into local languages to enhance accessibility and understanding.

Our legal team has played a crucial role in negotiating, interpreting, and enforcing backbone and backhaul infrastructure contracts. These include agreements related to Service Level Agreements (SLA), Base Transceiver Station (BTS) rollouts, managed services, fiber deployment, data centers, Ethiopian Electric Power, Ethiopian Electric Utility, and Enterprise Resource Planning (ERP) systems.

In terms of financing, we have successfully negotiated and closed overdraft and term loan facilities worth hundreds of millions of dollars. This includes local law-governed contracts on IFC financing, such as the Debt Service Reserve Account (DSRA) contract. Additionally, I have led the team in defending the company’s interests in more than 10 court cases, achieving these results with an almost entirely in-house team, which underscores our capability and efficiency.

Mobile Financial Services (M-PESA)

On the mobile financial services front, our legal and regulatory team has been instrumental in achieving three major milestones. First, we successfully revised the National Bank of Ethiopia (NBE) legal framework, including the National Payment System Proclamation and the PII Directive, to allow foreign investors to engage in mobile financial services. This was a significant step towards liberalizing the mobile money sector in Ethiopia.

Second, we established Safaricom M-Pesa as the first foreign mobile financial services company in Ethiopia. This task was particularly challenging because the foundational work had to be done before the directive was officially amended. The various subsidiary options for setting up the MFSco were contentious, each with its unique advantages and disadvantages. However, through diligent facilitation of discussions among consortium shareholders, the National Reserve Fund (NRF), Safaricom Ethiopia management, and various government bodies, we successfully established the entity as a wholly-owned subsidiary of Safaricom Ethiopia in record time.

The third milestone involved securing a license from the NBE. This required presenting our case before the NBE and participating in parliamentary public consultations to advocate for the fast-tracking of mobile money sector liberalization. Our efforts culminated in the enactment of the revised proclamation and PII directive, ensuring a level playing field for all players in the sector.

To support our operations, the legal team prepared at least seven standard M-PESA contracts for use with different categories of counterparties. I also managed the Delegation of Authority (DOA) for M-PESA, as well as shared service contracts and novation/accession agreements.

In summary, our proactive legal and regulatory efforts have been pivotal in establishing and expanding Safaricom Ethiopia and Safaricom M-Pesa Mobile Financial Services. Through meticulous contract management, strategic negotiations, and robust regulatory advocacy, we have laid a strong foundation for continued growth and success in the Ethiopian market.

Which recent political, economic or regulatory changes have impacted your work the most in recent years?

In addition to the MPESA Ethiopia licensing mentioned above, I can highlight two recent determinations by the regulator of the telecom business, the Ethiopian Communications Authority. My team has been engaging with the regulator to secure these determinations over the past couple of years. The first determination is the Market Review Result, where the incumbent operator was declared a Significant Market Player (SMP). This designation subjects the SMP operator to stricter regulations, ensuring that market entrants such as Safaricom Ethiopia can compete fairly and survive against unfair business practices. The second determination pertains to the Cost Study, in which the regulator set the Mobile Termination Rate (MTR)—the rate that an operator pays to another operator when its customers call the other operator’s line. This determination ensures that operators cannot charge more than the MTR rate for these calls. The full implementation of these two determinations is crucial for the regulator’s goal of ensuring a level playing field among all operators.

Are there any causes, business or otherwise, that you are passionate about?

Currently, my primary ambition is to play an instrumental role in successfully transitioning this company (which is still under investment phase) to one of the most successful brands in the country. I started my professional career as a university professor 16 years ago before I moved to the corporate legal practice. I plan that once I retire from my corporate practice, I would return to the academic’s life to coach and mentor the youth and also carry out legal research on various topics.