Business

MTN, Vodacom face price-fixing probe

Staff Reporter

The Competition Commission has subpoenaed key people at MTN and Vodacom for suspected price-fixing, it was reported on Monday.

The Competition Commission has subpoenaed key people at cellphone providers MTN and Vodacom for suspected price-fixing, the Business Report said on Monday.

Commissioner Shaun Ramburuth would not say how many people had been subpoenaed, saying only that the “process of interviewing them is under way”.

“I don’t want to prejudge the case,” he told the newspaper.

The allegations of price collusion relate to interconnection fees, which the operators raised by 500% to R1,25 in 2001.

This was the same year that newcomer Cell C entered the market.

Ramburuth said it had been difficult to find evidence of “explicit collusion”.

“Vodacom and MTN set the rate between themselves and in that agreement have a non-discrimination clause, which says that everyone will be charged the same.

“In circumstances like that [the difficulty is to establish] explicit collusion. The situation somehow provided a defence for the cellphone companies, who claim that they did not collude and that the regulations required them to do that,” said Ramburuth.

Recently, the government has intervened to try to get high interconnection rates lowered, and the Independent Communications Authority of South Africa is meeting the operators this week.—Sapa

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