[kictanet] FW: PRESS RELEASE ON FIXING OF PRICES

[Wambua, Christopher]

  PRESS   RELEASE

  
 

 

 

 

23rd April 2012 

 

Listers

 

CCK's response to media reports on alleged collusion to fix retail
mobile voice prices 

 

The attention of the Communications Commission of Kenya (CCK) has been
drawn to media reports alleging a plan to fix retail voice tariffs by a
section of the mobile service providers ostensibly with tacit approval
of CCK. The CCK wishes to state as follows:

 

1.      CCK considers the retail mobile voice market as sufficiently
competitive, thus making it unnecessary to impose any stringent retail
price regulatory obligations on the licensed mobile operators.  However,
even for such competitive market segments where the Commission does not
impose retail price setting obligations, the law (i.e. clause 4(3) of
the Kenya Information and Communications (Tariff) Regulations, 2010,)
prohibits licensees from applying tariffs that distort competition,
exploit consumers and, possibly even prevent market entry. 

2.      Therefore, all mobile operators set their retail prices
independently guided primarily by their costs of providing a particular
service and are only obligated to file with the Commission their retail
rates as provided for in their respective licences. 

3.      While the CCK recently held discussions with some licensees
regarding the wholesale interconnection rate and the attendant glide
path, no request has been officially made regarding the intention to fix
the retail mobile voice tariff either by those players on any other
licensee. As such, no such approval has been granted.

4.      Retail price fixing as practiced in collusive oligopoly markets
is an anti-competitive business practice that is contrary to the
prevailing competition law and policy. Retail price fixing in the mobile
voice market in Kenya would, therefore, be in breach of the law; and as
such no approval can be granted.

5.      The Commission is currently carrying out a study to evaluate the
impact of competition on the mobile voice market on the entire economy.
We would like to clarify that the study, which is being undertaken by
the Kenya Institute of Public Policy Research and Analysis (KIPPRA), is
in not in any way meant to determine interconnection rates for the
mobile telecoms market. 

Issued by

Francis W. Wangusi

Ag. Director-General 

 

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