MTN Uganda goes to court over interconnection rates

IDG News Service

 Edris Kisambira, The Industry Standard
Uganda's largest mobile telephone operator,
Mobile Telephone Networks (MTN) has taken
the industry regulator, Uganda Communications
Commission (UCC), to court over plans
to fix interconnection rates.

In April this year, the UCC announced that
it would come in to regulate interconnection fees
that players in the mobile telecom sector pay
when they carry each other's call traffic.

A fixed interconnection rate is
international practice, which
the Ugandan market had yet to adopt.

Today, every one of the five players in
the Uganda market charges
a high interconnection fee to maximize profit.

In the suit, which was filed at
the Kampala High Court, MTN wants
a declaration that UCC has
no legal authority to fix
telephone interconnection rates
among telephone operators.

MTN Uganda wants a permanent injunction
restraining the management of UCC
from fixing the interconnection rates.

MTN claims that on Dec. 7, the UCC fixed
telephone interconnection rates at
US$ 0.066 for mobile and fixed termination
near end; $0.063 for fixed termination far end;
$0.013 for transit; $0.007 for SMS termination;
and wholesale leased line charges
 at a retail rate of less 20 percent.

"By law fixing telephone interconnection rates
between telephone operators is a matter
of negotiations and agreement and
as such UCC's decision shall have effect
of re-writing the said agreement contrary
to the law and public policy,"
the complaint reads in part.

The move to regulate interconnection charges
was informed by a consultation study
on interconnection, retail costs and pricing
that was undertaken by
PricewaterhouseCoopers London
on behalf of the UCC early in the year.

New mobile competitors coming into
the Uganda market have in the past
been critical of the existing policy
of leaving the issue of interconnection
to the players themselves.

The new interconnection regime aims
to provide users with the widest
possible choices of quality service
at the most competitive prices
and gives policy makers and regulators
opportunities to foster and
enhance universal service/access initiatives.

It also requires network operators
and service providers to perform
their competitive/complementary activities
in an orderly manner and
with due regard to public interest.

Link here

Sent from Kigali, Rwanda

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