ISLAMABAD: Reiterating their concerns over the proposed acquisition of Telenor Pakistan by PTCL, Jazz and Wateen informed a three-member bench of the Competition Commission of Pakistan (CCP) on Thursday that the combined entity would be able to manipulate tariff structures at their discretion.
The fifth and the last hearing in the Phase II review of PTCL’s acquisition of Telenor and Orion Towers Ltd was conducted by CCP Chairman Dr Kabir Ahmed Sidhu alongside members Salman Amin and Abdul Rashid Sheikh.
While Wateen opposed the proposed merger, Jazz and Zong expressed competition concerns and the fear of abuse of dominance after the merger of Telenor Pakistan with Ufone as the merged entity would be operating under the Pakistan Telecommuni-cation Company Ltd, which is the biggest player in the internet as well as other segments of the telecom sector.
Jazz legal counsel Khalid Ibrahim emphasised concerns about frequency allocation, stressing that PTCL already holds a strong position in upstream markets, including spectrum, infrastructure, and IP bandwidth, which could further bolster its dominance post-merger.
He called the CCP to apply specific conditions, like those enforced in the Warid-Mobilink merger.
The representative of Wateen highlighted issues related to the upstream telecom market and said that the Long Distance and International (LDI) operators, including Wateen, would be at a disadvantage as after the merger, the PTCL would be in a position to sign contracts with overseas telecom operators to have their inbound telecom traffic through the PTCL’s LDI.
Wateen highlighted that PTCL could ‘dish out’ other LDI competitors under such conditions.
The CCP bench posed critical questions regarding the potential impacts of the merger, ensuring thorough scrutiny of the competitive dynamics in the telecom sector and inquired about possible benefits to the customers.
PTCL Chief Executive Officer Hatem Bamatraf responded that the country lags behind its regional peers in terms of telecom performance and digital adoption, and the customer would benefit through enhancement in the overall service offerings, including an expanded retail and customer care network, value-added services, and a plethora of digital offerings.
PTCL’s legal counsel Rahat Kaunain responded to the objections and queries against the proposed merger, and extensively referred to the CCP’s 2016 order related to the Mobilink-Warid merger, saying anti-competitive behaviour and abuse of dominance should be the matter of concerns.
She said that after the Mobilink-Warid merger, the new player, Zong, also progressed in terms of subscribers.
Published in Dawn, October 25th, 2024
