Competition Commission of Pakistan (CCP) has allowed the telecom operators having Long Distance International (LDI) license to withdraw application for exemption for their proposed International Clearing House (ICH) Agreement to be entered with the Pakistan Telecommunication Company Limited (PTCL). A statement issued by CCP said upon application filed by PTCL and other LDIs operators has allowed withdrawal of the application filed under Section 5 of the Competition Act, 2010 for the purpose of seeking exemption for their proposed ICH Agreement to be entered into between PTCL and the LDI Operators disposing the matter through its order dated February 9, 2012.
While allowing the withdrawal of the exemption application, the CCP order said that if in future the applicants enter into such agreement or arrangement, notwithstanding, any authorisation obtained from any other authority such agreement prior to its execution would require clearance from the Commission, as prima facie, it has serious competition concerns and would attract the provisions of the Competition Act, 2010. Through the proposed ICH agreement, LDIs intended to assign their rights, granted to them by the Pakistan Telecommunication Authority (PTA) under the LDI license, to terminate incoming international traffic to PTCL. During the period the ICH agreement were to be in effect, each LDI were to suspend and keep suspended all interconnection capacities in relation to Pakistan Incoming Traffic at its end. PTCL were to act as the sole LDI operator with the right to exclusively terminate all incoming traffic to the country. PTCL were to sell its call terminating services to foreign carriers at the Approved Settlement Rates (ASR) of PTA, and each LDI would get a pre-determined fixed quota from PTCL to terminate calls at its network, and receive a fixed share of revenues generated from all incoming international traffic. The arguments presented by the applicants to support the ICH agreement included stabilisation of the international incoming traffic rate as per PTA determination to curb the grey traffic and to create a vital impact on the national economy in terms of huge influx of foreign exchange in the country, increased taxes for the government due to the increase in revenue. The applicants claimed that the ICH would not fix price, but only PTA’s approved ASRs would be implemented and it would have no control on the production of voice minutes towards Pakistan thus having no impact on telephone users in Pakistan.
