The Competition Commission has cleared SA's two largest cellular operators of colluding to set interconnection rates between themselves, to the detriment of Cell C.
The commission's manager of advocacy and stakeholder relations, Oupa Bodibe, says it will not refer an investigation into alleged collusion by MTN and Vodacom to the Competition Tribunal for a hearing.
Bodibe explains that the commission could not find evidence that MTN and Vodacom had agreed among themselves to fix interconnect rates to the detriment of Cell C, SA's third mobile operator.
The investigation dates back to around 2004, when complaints against the cellular operators were lodged with the commission. The complainants alleged the two largest operators had abused their dominance by fixing interconnect rates, which limited competition in the sector.
The first complaint of collusion brought to the Competition Commission against the operators was lodged in 2004. Two others were submitted in 2005, one relating specifically to interconnect.
In 2009, Keith Weeks, head of the commission's Enforcements and Exemptions Division, said the initial fees were a bilateral agreement between MTN and Vodacom, and sanctioned by the Independent Communications Authority of SA (ICASA).
All sorted
However, Bodibe says the fees were set during a period when ICASA was not regulating the market, but the authority has since stepped in and set interconnect rates. ICASA's regulation followed voluntary drops by the operators.
Mobile termination rates dropped to 73c per minute at peak and 65c during off-peak times this month. Next year, rates will drop to 56c and 52c. By March 2013, wholesale mobile termination rates will drop to 40c, regardless of the time the call is made.
MTN's chief corporate services officer Robert Madzonga says the company has not officially been informed the matter has been dropped. The company welcomes the decision as it can now get on with business without the issue “hanging” over its head, he says.
Vodacom executive head of corporate communications Richard Boorman says the company has not been officially informed and he can't comment.
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