MoIT Proposes Endless Powers for PTA to Regulate Anti-Competitive Laws

Ignoring the recommendations of Competition Commission of Pakistan (CCP), Ministry of Information Technology and Telecommunication (MoITT) has drafted ‘Pakistan Telecommunication Competition Rules, 2017’ to discourage anti-competitive conduct, avoid abuse of dominant position and ensure open and fair competition within the telecommunications sector.

CCP had recommended the MoITT to review telecom policy, where it has been stated that competition rules would be developed for the telecom sector. CCP had categorically stated that empowering Pakistan Telecommunication Authority (PTA) to regulate competition related matters in the telecom sector will not only create duplication of jurisdiction but will also engender legal uncertainty for the telecom operators and therefore recommended to review the telecom policy 2015.

However ignoring the CCP recommendations, the ministry has formulated Pakistan Telecommunication Competition Rules, 2017.

Keep reading to know more about MoIT’s Anti-Trust Laws for telecom sector:

Anti-Competitive Conduct

• Telecom operators cannot enter into an agreement — either with another operator or a third party — that is likely to prevent or lesson competition in the market.
• Unless approved by PTA, operators can not
  • fix prices
  • Co-ordinate separate bids for assets, resources or rights, or for any input in licensee’s services or for the provision of any telecommunication services;
  • Restrict competition in relation to the provision of telecommunication service or equipment to specific customers or to competition in specific areas;
  • Refuse to do business with a specific licensee, carrier, competition or customer;
  • Open and fair competition:

Draft said that PTA will regulate tariff or other terms and conditions of any telecom service. PTA will also be responsible for a check on telecom services for any anti-competitive practices.

Draft said that if an operator tries to defame another operator through ads, then it will be considered anti-competitive.

Moreover, telecom operators will also be barred to activate services automatically and from deducting any charges without the consent of the user.

Here are some other bindings for telecom operators:

• Hide actual prices of the packages.
• Abuses its dominant position in the relevant market
• Discriminates or reduces interconnection or other facilities to competing licensees
• Gets involved in vertical price squeeze in a relevant market where no substitutes are available
• Engages in cross-subsidization
• Misuses the information acquired for provisioning of services to the competitor including essential facilities or interconnection
• Attempts to lock in customers by any unfair means including high switching costs
• Engages in price squeezing of the margin of profit available to a competitor that requires wholesale services from the licensee by increasing the prices for the wholesale services required or decreasing the prices of the retail services in markets where they compete
• Undertakes bundling of services whereby the customers are required to purchase one product or service over which it has market power conditional on the purchase of a second, competitively supplied, product or service whereas the two products or services can be provided and consumed independent of each other

Draft also outlined the process for determination of significant market player and said that an operator will be considered SMP if it has a share of forty per cent (40%) or above of a relevant market.

Complete copy of the draft is available for download here.