MTN Uganda has officially filed a notice of appeal in response to a landmark High Court ruling delivered on April 21, 2025, in the case of VAS Garage Limited v. MTN Uganda Limited (Civil Suit No. 0689 of 2022).
The appeal challenges key findings by Justice Stephen Mubiru, who ruled in favor of VAS Garage, holding the telecom giant liable for breach of contract, conversion of proprietary data, and engaging in unfair competition.
According to sources close to the matter, the appeal, now filed in the Appellate Court, contests the core of the High Court’s reasoning—that VAS Garage held a proprietary or beneficial interest in a subscriber database developed during its contract with MTN.
MTN’s legal team insists that while aggregators are granted access to the network and a subscriber base for operational reasons, this does not equate to ownership or control over MTN’s customers.
The High Court had previously found that the dispute stemmed from MTN’s unilateral action taken in 2015 to “expire” or delete VAS Garage’s profiled subscriber database. MTN had cited a 2014 directive from the Uganda Communications Commission (UCC), which called for the implementation of a “Do Not Disturb” (DND) solution to block unsolicited SMS messages.
However, the Court found that the UCC directive did not authorize the deletion of content providers’ databases, but merely required telecoms to offer opt-out mechanisms to consumers.
Justice Mubiru, in a detailed 70-page ruling, held that MTN’s actions exceeded the scope of the directive and violated the contractual obligations it owed to VAS Garage under the Content Provision Agreements of 2013 and 2014.
The judge noted that VAS Garage had invested significantly in advertising and content development and had built a database of subscribers who opted into its services using MTN’s shortcodes 6666 and 0800206666.
The Court held that although MTN owns the overall customer relationship, the specific profiled subscriber data that VAS Garage compiled for its services had commercial value and was therefore entitled to protection.
The Court further ruled that MTN’s failure to process billing for VAS Garage’s services, its deletion of active subscriber data without notice, and its demand that customers re-subscribe monthly, amounted not only to a breach of contract but also to acts of conversion and unfair competition.
Justice Mubiru described the deletion of the database as a continuing tort, lasting as long as the plaintiff was deprived of its use.
In defending its actions, MTN had argued that all subscriber relationships on its network belong exclusively to MTN and that VAS Garage, like other content providers, was merely granted temporary and non-exclusive access to facilitate content delivery.
MTN maintained that the database in question was not owned by the plaintiff and that all modifications to the system were done in compliance with national regulatory requirements. The defendant also submitted that it had attempted reconciliation and paid out all outstanding invoices based on agreed reconciliations, and therefore considered the matter settled.
However, the Court rejected those arguments, stating that UCC’s 2018 ruling clearly established that MTN’s expiry of the VAS Garage database was not supported by the directive and constituted a misuse of dominant market position. Moreover, the Court emphasized that UCC, while serving as a regulatory body, does not have the legal power to award monetary compensation or enforce damages, thereby justifying the plaintiff’s recourse to the High Court.
Justice Mubiru clarified that although administrative remedies exist under the Uganda Communications Act, the Uganda Communications Tribunal—intended to handle such disputes—has never been operational. In such circumstances, the Court affirmed that it retains jurisdiction to enforce commercial rights and award remedies where appropriate.
Among the damages claimed by VAS Garage were UGX 1.2 billion in interest on delayed payments, UGX 8.3 billion in lost income over 29 months, special damages for promotional investments amounting to UGX 300 million, and general damages for lost business, goodwill, and revenue streams. The Court ruled that these claims were not barred by limitation, as part-payments made by MTN in 2022 restarted the statutory period, and the injury caused by the deletion of the database was a continuing tort.
In its appeal, MTN now seeks to overturn these findings. The company’s lawyers argue that granting a content aggregator access to a network and subscriber list does not transfer ownership or entitle the aggregator to claim revenue rights over individual customers.
They maintain that the High Court mischaracterized the nature of the contractual and operational relationship between a telecom operator and its third-party VAS providers.
The appeal contends that the plaintiffs had no independent customer base, and therefore the loss of the so-called database cannot constitute conversion or economic injury in the form described.
Although MTN has yet to issue a formal public statement, sources confirm that a comprehensive response is being prepared to explain its position both to the public and to the regulatory bodies.
Internally, MTN believes the High Court ruling, if allowed to stand, could set a dangerous precedent by assigning proprietary rights to external vendors over telecom subscribers.