The Competition Commission of Pakistan (CCP) has passed an order directing the management of DHA-I Islamabad to restore a level playing field by giving ‘Right of Way (ROW)’ to Nayatel to provide its Cable Internet and Telephony Services (CIT Services) on the same terms and condition as are being offered to other existing operators.
The CCP conducted an enquiry after taking a Suo moto notice of the complaints and concerns received from the residents of DHA-I Islamabad, stating that had been deprived of an alternate choice of CIT services provider, which was restricted to only two operators, i.e., Pakistan Telecommunication Company Limited (PTCL) and DHAI Teleman.
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They alleged that DHA was not letting Nayatel operate in the area despite the company’s interest to provide its services.
The Right of Way (ROW) is a platform for internet service providers for the provision of CIT services. According to complaints, DHA management had given ROW to PTCL and DHAI Teleman in DHA-1 while denying the same to Nayatel on equal terms and conditions.
It was alleged that DHA’s management had created a barrier to entry for Nayatel by offering dissimilar conditions and demanding a higher price of ROW than the already existing internet service providers.
The CCP’s enquiry concluded that DHA management, prima facie, abused its position in violation of Section 3 of the Competition Act, 2010, by not allowing Nayatel to operate in the relevant market and recommended initiating proceedings against DHA under Section 30 of the Act.
After hearing the parties, the bench passed the order, in which it applied the ‘essential facility doctrine’ to the matter and observed that in the current era, the CIT services are an essential need for the citizens, both for personal and commercial use.
The order further stated that the residents of DHA-I were demanding CIT services from Nayatel, being a Fiber-to-the-Home (FTTH) based CIT service provider. However, DHA-I’s management, abusing its dominant position, refused to issue a NOC to Nayatel to install its infrastructure within DHA-I Phase-I and other sectors.
As per the order, DHA-I held a dominant position in the relevant market and had already granted ROW to four parties, i.e., PTCL, Transworld, Wateen, and its very own subsidiary, DHAI Teleman, for providing (G-PON) and allied CIT service to the residents of DHA-I. Whereas, the licensee seeking the ROW was Nayatel.
The already existing service providers are on a cost-sharing basis with DHA-I rather than on a revenue-sharing basis. The order observes that DHA-I has failed to explain any logic as to why there has been a disparity between the charges offered to Nayatel and other incumbents, which amount to discrimination and application of dissimilar conditions to the same transaction, under Section 3 (1), read with subsection 3(e) of the Act.
The order also finds support from the directive issued by the Ministry of Information Technology and Telecommunication in October 2020, called the “Public and Private Right of Way Policy Directive” (the Policy Directive) which stated that “the Public Authority shall not discriminate any licensee towards charging of right way fee and there shall not be any differential or preferential treatment in right of way fee for any type of licensees, including other utility service providers, and those wholly or partially owned by the Federal or Provincial Government, or the Pubic Authority.”
Keeping in view all circumstances, and to give a chance to DHA-I to correct its behavior, it was ordered to offer Nayatel within 90 days from the date of the order to use the ROW on terms and conditions, no less favorable than the incumbent service providers.
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The CCP has not imposed any penalty on DHA for now. However, in case of non-compliance, DHA-I shall be liable to pay Rs. 2 million for violating Section 3 of the Competition Act, 2010, in addition to appropriate penalties for non-compliance under Section 38 of the Act.
DHA-I has been further directed to file a compliance report before the Registrar of the Commission no later than 7 (seven) days from the date such offer is made to Nayatel.
