Court rules that disputed MTRs will apply for six months

1 Apr 2014

The South Gauteng High Court in Johannesburg has ruled that the telecoms regulator’s decision to cut mobile termination rates (MTRs) will come into force today (1 April) as planned, but will only remain in place for a period of six months, Bloomberg reports. Earlier this year the country’s two largest mobile operators by subscribers, MTN and Vodacom, launched legal proceedings against the Independent Communications Authority of South Africa’s (ICASA’s) decision to halve their MTRs to ZAR0.2 (USD0.019) per minute this year, with further cuts scheduled to follow in 2015 and 2016. MTN and Vodacom argued that smaller operator Cell C should not gain the benefits of asymmetry as it is not a new entrant, and claimed that the regulator did not follow the correct process to determine the rates. While describing ICASA’s MTR decision as ‘unlawful and invalid’, the court nevertheless suspended the declaration of invalidity for six months, during which time the regulator will be required to review the rates. Responding to the court’s decision, Pieter Grootes, general manager for markets and competition at ICASA, told reporters that during the six-month period the regulator will ‘be conducting a further review in terms of the future of termination rates in South Africa.’ Meanwhile, Vodacom spokesman Richard Boorman said: ‘It appears that our position has been vindicated but we’ll be studying the judgment and will respond in more detail later.’

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