BH Telecom reports Telekom Srpske for unfair competition

3 Dec 2007

Bosnia’s largest telco, BH Telekom, has reported the mobile arm of rival Telekom Srpske to the state regulator over ‘unfair competition and monopolistic practices’. ‘We complained over unfair competition by m:tel,’ BH Telekom spokeswoman Nadja Lutvikadic told Reuters. But m:tel dismissed the allegations, saying it was following European Union recommendations to cut roaming charges.

Until a few years ago, there was a tacit agreement between the two operators to stay on their own side of Bosnia’s two ethnic halves: BH Telekom operated in the Muslim-Croat federation, while Telekom Srpske offered services in the Serb Republic. The enmity left from the 1992-95 war ensured there was little cross-over, and counting the entire country as a whole, BH Telecom had 50% of the fixed and mobile market, Telekom Srpske had 35% and HT Mostar some 15%, broadly reflecting the ethnic balance between Bosnia’s Muslims, Serbs and Croats.

But increased competition in mobile services crossed the ethnic divide when Serbian state firm Telekom Srbija bought Telekom Srpske in December last year. It connected its network to partner operations in Serbia and Montenegro and eliminated roaming charges for subscribers travelling to these two countries. Subscribers of Telekom Srbija or its Montenegrin m:tel service pay the same price for calls in the Serb Republic as in their native countries, but double when they connected to the networks of BH Telekom or HT Mostar, Lutvikadic said. ‘There is a single market indeed, but not of Bosnia-Herzegovina but of Serbia and Republika Srpska, created after the sale of Telekom Srpske to Telekom Srbija,’ she said.

In a summary of the complaint to RAK, obtained by Reuters, BH Telekom accused m:tel of breaking the terms of its licence and damaging healthy competition on the regional market. It said that the ‘integration of Telekom Srpske and Telekom Srbija market powers shows all elements of a united domination that is banned under the European Union regulation and under the law on the protection of competition.’

Bosnia and Herzegovina, Telekom Srpske, BH Telecom,

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