October 15, 2009 / 6:31 AM / 9 years ago

REFILE-UPDATE 2-Vodacom, MTN deny price collusion allegations

(Refiles to correct to “deny” in headline) (Recasts with Vodacom, MTN comments, writes through)

By Gugulakhe Lourie

JOHANNESBURG, Oct 15 (Reuters) - South African telecom groups Vodacom (VODJ.J) and MTN Group (MTNJ.J) denied anti-competitive activities after the competition watchdog said it was investigating possible collusion over prices in the industry.

Vodacom, owned by UK-based Vodafone Plc (VOD.L), said in a statement on Thursday it was not involved in any anti-competitive behaviour, while MTN also denied it was engaged in collusive conduct related to interconnections.

“The Competition Commission has investigated three complaints against mobile operators, including MTN, relating to interconnection,” it said. “MTN denies there is any merit in these complaints and the competition commission has not instituted any action against MTN pursuant to the complaints.”

Their comments come after the country’s Competition Commission said it would investigate possible collusion over prices.

“We’ve got three cases that we are investigating (in the mobile phone industry), but they deal with the same issue,” Nandi Mokoena, the Competition Commission’s manager of strategy and stakeholder relations, told Reuters in a telephone interview.

“The allegations are that cellular phone companies have agreed on the rates they charge.”

Mokoena said mobile phone operators had been notified about the probe.


Asked when the Commission would complete its investigation, Mokoena said it was impossible to provide an exact date but the finalisation of the case depended on many things.

“For instance, there are aspects of regulations here in the case. So we are having to work with the communications watchdog on these cases to try and sift out the aspects that are purely about competition and regulation.”

The Commission said it had not yet made any decision about the case.

The South African government earlier this week held public hearings as part of plans to push mobile and telecom operators to reduce interconnection fees in an attempt to lower telecoms costs.

On Tuesday, the government ordered a cut in mobile phone charges by the end of November, saying it had been forced to act because the communications regulator would not do so.

Siphiwe Nyanda, minister of communications, directed the regulator to lower interconnection rates, a charge to transfer calls to rival networks.

The committee has proposed interconnection rates should be cut to 60 cents per minute during peak times by November and then by a further 15 cents annually until 2012. Operators currently charge each other 1.25 rand per minute during peak times. (Editing by David Holmes)

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