Cell C, Telkom respond to call termination ruling
Telkom and Cell C welcomed the South Gauteng High Court ruling on the new mobile termination regulations.
The South Gauteng High Court on Monday (31 March) ruled that new call termination regulations issued by the Independent Communications Authority of South Africa (Icasa) are “unlawful and invalid”.
However, the declaration of invalidity has been suspended for 6 months, which means that that the new call termination rates will kick in on Tuesday, 1 April 2014, as planned, but Icasa has been given six months within which to review them.
Among other things, the current regulations cut mobile termination rates (MTRs) to 20c per minute, while allowing asymmetry of up to 44c per minute.
Under the ruling, for the next 6 months Cell C and Telkom Mobile will be allowed to charge Vodacom and MTN significantly more to place to calls to their networks than Vodacom and MTN can charge them.
Telkom
“The court has exercised its discretion in the interest of the public to allow the mobile termination rate of 20 cents and the asymmetric rate of 44 cents to be implemented for the next six months, effective 1 April 2014,” Telkom said in a statement.
“Within the six month period the Independent Communications Authority of South Africa (Icasa) must complete a costing exercise and follow due process,” Telkom said, adding that it will support Icasa in completing this process effectively and efficiently.
Telkom said that it believes the ruling is in the best interest of the industry and that it “will go far in reducing the cost to communicate and stimulating competition in the industry.”
Cell C
Jose Dos Santos, Cell C acting CEO said in a statement that Cell C believes the ruling made by Judge Mayat, “is a step in the right direction and is positive for the consumer and the South African economy as a whole”.
“Unfortunately, Vodacom and MTN have managed to frustrate the long-term process envisaged by ICASA to increase competition in the market, which would have resulted in lower prices for consumers in the long run,” Dos Santos said.
“The uncertainty over MTRs over the next three years will continue to make it difficult for smaller operators to confirm their business plans beyond October 2014. It also negatively impacts on the smaller operators’ ability to bring down prices to ensure all South Africans have access to affordable communications.”
MTN and Vodacom
Both MTN and Vodacom opposed the new regulations, arguing that Cell C should not gain the benefits of asymmetry as it is not a new entrant, and that Icasa did not follow the correct process to determine the rates.
Initially, the new call termination rates were supposed to kick in on 1 March 2014 after being announced on 29 January 2014.
MTN applied for an urgent interdict against the new regulations, resulting in Icasa announcing that it would move the implementation date to 1 May 2014. Later Icasa revised its position and set the commencement date for 1 April 2014 instead.
In a last ditch effort to prevent the interdict from being granted, Icasa also announced that it would relook the rate cuts set out in the regulations for 2015, 2016, and 2017.
Icasa went on to publish urgent amendments to the regulations in the Government Gazette which repealed all the rate cuts but the 20c/44c adjustment for 2014.
More on mobile termination rates
MTN, Vodacom call termination case: court rules
Icasa makes fresh changes to MTR regulations
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