Cell C Voice Heard in MTN Case in South Africa

Telecoms

Cellular operator Cell C has won the right to question MTN when the Competition Tribunal stages hearings into alleged anticompetitive behaviour.

MTN will be in the dock for charging a commercial rate to connect calls made from Cell C's community service pay phones when callers dial an MTN number. Since the phones are in underserviced areas, Cell C believes MTN should charge the subsidised interconnection fee of just 6c, instead of the R1.25 it demands.

The two companies are withholding the fees from each other, with Cell C claiming that MTN owes it R1bn after years of overcharging and Cell C owing MTN R800m in retaliation. Last week the tribunal agreed that Cell C could participate in the hearings against MTN by calling its own witnesses, cross-examining witnesses and presenting evidence of its own.

The dispute has been going on since April 2005 when Cell C lodged a complaint with the Competition Commission alleging that MTN was abusing its dominance and was guilty of price discrimination. The commission agreed and referred the complaint to the higher authority of the tribunal in July.

MTN is accused of engaging in prohibited price discrimination by charging Cell C the commercial interconnection fee despite charging Vodacom the subsidised rate for calls made from Vodacom's community service phones, even when the phone boxes are standing side-by-side.

The commission accuses MTN of abusing its dominance by engaging in prohibited practices by disregarding the interconnection deal it has with Cell C and refusing to terminate calls from Cell C's community phones at the subsidised rate.

MTN argues that Cell C is placing its community service phones in areas that are not underserved, and it therefore has no right to expect the reduced interconnection fees .

Cell C says that the areas were selected in consultation with the industry regulator.

Business Day