Policy & Legal Issues in Mobile Money Transactions

Presentation to Uganda Colloquium of Judges and

Magistrates in 2014-Imperial Royale, Kampala, Uganda

By Ojijo Pascal Al Amin

Lawyer & Guest Lecturer In AICT Law, Law Firm Management, And Financials Services Law; Public Speaker, Consultant,
Entrepreneur. ojijo@lawpronto.com: +256 776/701 1000 59

Same Monkeys, New Forest

Common
Law
Principles

Equity
Maxims

Mobile
Money
Law

Statutory
Rules of
Interpretatio
n

Constitutional
& Public Law
Principles

to smartest way to
learn the law, is to
learn the principles
upon which the law is
founded

Ojijo-Legal Rhetoric:
Principles,
Presumptions, Maxims,
Doctrines, Rules and
Tests of Law. ISBN.
978-9966-123-02-2

ISBN
978-9966-123-00-8

author of 35 books

consulta
nt
PUBLIC SPEAKER
Financial Literacy
Personal Branding
Public Speaking
BUSINESS
STRATEGY
Strategic Planning
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Clubs
EXPERT LAWYER
ICT Law

My Offices

Mobile Money in African Countries -34/54

Not Covered
37%

Covered
63%

Mobile Money: Facebook Users

3:1

Telcos with Mobile Money

Without Mobile
Money
23%

With Mobile
Money
77%

MM Accounts vis-a-vis Bank

Accounts

4X
more mobile money accounts than bank accounts

(Kenya, Madagascar, Tanzania and Uganda)

>mobile money agent outlets than bank branches in 28

countries

Chart Title
East Africa

World

83%

75%
63%

37%

36%

25%
17%
5%

Top 20 Mobile
Money
Companies

Top Transactions

Adult Users

% of GDP

From 1 provider in 2001, to 219 providers in 2013

Mobile Money-Uganda Statistics

20% of GDP (GSM, 2013)

8.9 million of 15 million mobile subscribers using

MM (UCC, 2013)
Growth Rate of transactions is 211% (Lous
Kasekende-BOU, 2013)
Main transactions (air time purchase, person to
person and person to business, utility bills,
service bills, saving vehicles, bank transactions)

Why?

"Justice for all."

Mobile
Payment (
Commerce &
Government)

Mobile
Money
Mobile Money
Transfer

Mobile
Banking
(Deposits &
Withdrawals)

Jurisdictional
Sovereignty & Limiting
Agreements
Subject Matter/Geography
Criminal vs Civil
Parties
Mandate Wars (Judicial
Review)
Cross Industry Regulators
(UCC, BOU, Competition
Authority, Insurance Regulatory

Deposit Protection
Consumer Protection

Prudential Regulation!
Trust Accounts c.f. Lawyers Trust Accounts

Management
Ascertainability =Insurability!
Interest on Deposit (Assets)
Case Study: Pass Through Deposit Insurance
(US & Kenya)

telcos

banks

mobile money
players
ecosystem

regulato
rs

agents/
mercha
nts

legal ecosystem
BOU Act

UCC Act, 2013

Financial Institutions Act, 2004

Computer Misuse Act (2011)

Electronic Transactions Act, 2011

Electronic Signatures Act, 2011

Attendant Regulations

Money
Laundering

Consumer
Protection

Interopability

Supervision

Bank of
Uganda MM
Regulations
(2013)

Definition of
Terms

Standards

Stakeholders

BOU-UCC
Clarity?
NITA-U?
Legal Entities

SACCOS
?

Competition

Mobile Money Transaction

Agent

Escrow
Bank
Account

User

Agent

EFT Message
Simultaneous
Debit/Credit
Order

Bank of
Uganda

Competition
Authorities/
Courts

Mobile
Money
Transactions

URA

UCC/
NITA-U

Money Laundering Generally

Placement

Layering

Intergration

Splitting
Deposits
(Agents &
Users)

Round-Tripping

Black Salaries

Blending Funds

Mobile Money
LaunderingStrategies

Mobile
Gambling

Currency
Exchanges

Loan
Repayment
(Mobile
Banking)

Mobile Money Laundering-Response

Know Your Customer (KYC) Rules

SIM Registration
Recording Transactions
Intelligent Networks
Spot Supervisions

Mobile Money Frauds

Pin Code Fraud

Network Busy
Telecoms Employees
Fraud Agents

Mobile Money Crimes

Derivative Crimes

Money Laundering
SMS Fraud
Help My Mother Fraud
Deposit Splitting
Ghost Agent Lines

Dispute
Resolution

Personal &
Traffic Data

Price
Information

Complaints
Mechanism

MOBILE
CONSUMER
PROTECTION

Competition

Protection of
Consumer
Assets

Privacy

Cancellation
Right

Net Neutrality!

Access

Neutrality

Balkanization

Mobile Money to Forex Exchange

Do we need new pedigree of forex license?

Money Transmittinglicense
Money Transfer License
Forex License/Money Changing License
How much?
What qualifications?
Additional tax to agents?
Loss of revenue?

Taxation vis--vis Innovation

Double Taxation, Place of Supply Doctrine,
versus Permanent Establishment Doctrine,
Residence, Source Rules & Cross
Ownership of Agencies, Sub Agencies, etc

Capital Gains (Interest on Deposits,

Income Recognition, Advances to Agents)

Commissions (Agents, Shared Resources,

etc)

Assets vis--vis Liabilities (Agents

Financing, Deposits, etc)

Competition

Agency
Doctrine

Freedom
to Contract

Websites + Mobile Phones

Webile

Data Fluidity= Liability Swamp

Civil
Claims

Torts

Breach of
Contract

Crimes

Strict
Liability

Other
Crimes

Regulation?
Public
Choice
Theory/
Utilitarian
Analysis
Transaction/
Functional
vis--vis
Institutional/
Statutory

Cost Benefit
Analysis/
Economic
Analysis of Law

Mobile Money & Internet Banking

Act!
Liability of ISPs, telecos, banks

Definition of emoney, and currencies

Crimes, police powers,

Taxation, regulation, jurisdiction,

interoperability of mandates

Consumer protection (data, security

guidelines, privacy, deposit protection,
dispute resolution mechanisms)

Software
As A
Service

Cloud
Computing

Shared
Resource
Models
Shared
Towers

Shared
Agents

MNOs Becoming Telcos

(Competition)
Equitel

Legality of BOUs Involvement

Financial Consumer Protection

Mobile Money Guidelines
Indirect Supervision (Escrows, Partners)
Setting Limits on Withdrawals, Sent Amounts, etc
Investigation, Compliance and Reporting
Requirements
Deposit Protection Requirement (Financial
Consumer Protection)
Prudential Regulations
Fiscal Policy (Anti Money Laundering)
Monetary Policy (Macro Debt vis--vis Micro Credit)
Regulating Legal Tender vis--vis Alternative
Currencies

Matters Arising

Stored value, escrow

Crypto currencies,
virtual currencies,
alternative currencies

emoney

money

Other Legal Issues

Breach Of Contract Enforcement

Intermediary Liability (Strict, Negligent, etc)

Data Security (Equitel Case)
E-Intellectual Property: , c-Patents, TradeMarks,

Domains

Institutional Reforms
Gaming
Authority/Gaming
Commission

Competition Authority

Mobile Money Working

Group

Aggregators

Thank You!
Webale Nyo!
Ahsateni Sana!

My Mother is Very Proud of You!

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