Announcements Corporate Rating Alerts

GCR suspends Continental Transfert Technique Limited’s Ratings

Lagos, 17 December 2019 — Global Credit Ratings has suspended the long term and short term national scale Issuer ratings accorded to Continental Transfert Technique Limited (“CTTL” or “the Company”).

RATING RATIONALE

The ratings were suspended following a court ruling against CTTL, the Ministry of Interior, and the Comptroller-General of Immigration by a Federal High Court sitting in Lagos on 20 November 2019. According to the court judgment, the court declared, among others, that the engagement of CTTL by Ministry of Interior to fix and collect the Combined Expatriates Residence Permit and Alien Card (“CERPAC”) fees in Nigeria is illegal and unconstitutional. The court ruled that only the Nigeria Immigration Service is lawfully empowered to collect such fees. Also, the court made an Order of perpetual injunction to restrain CTTL from interfering with the fixing, collection and distribution of the CERPAC fee paid by every expatriate in Nigeria in any manner whatsoever.

The court ruling followed a petition filed in the Federal High Court against the Ministry of Interior, Comptroller-General of Immigration and CTTL, over the legality of the CERPAC contract as well as the upward review of the CERPAC fee from USD1,000 to USD2,000 in December 2018.

GCR notes that CTTL has filed a Notice of Appeal and Motion on Notice for Stay of Execution on 22 November 2019 with notice to file further grounds of appeal.

Although highlighting the risk that the reliance on a single contract does expose CTTL to policy variations by the Federal Government of Nigeria, at the point of according the ratings on 21 November 2019 there was no indication of the stated developments. As the court ruling against CTTL may have significant ramifications on the Company’s financial position and credit profile, and there is no sufficient information available to determine the potential impact, GCR can no longer support the current ratings.

The ratings will be reviewed when it will be possible to ascertain the longer term impact of the court ruling on CTTL’s financial strength and credit quality.

NATIONAL SCALE RATINGS HISTORY

Initial rating (July 2017)
Long term: BBB+(NG)
Short term: A2(NG)
Outlook: Stable

Last rating (December 2019)
Long term: Suspended
Short term: Suspended

ANALYTICAL CONTACTS

Primary Analyst
Femi Atere
Analyst
Lagos
femi@gcrratings.com
+23 41 9049462

Committee Chairperson
Dave King
Chairman



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