The South Gauteng High Court’s decision to implement the Independent Communications Authority of South Africa’s (Icasa’s) tabled mobile termination rate (MTR) cuts over a six-month period has been cautiously welcomed by smaller operators, but left the future of the glide path open to uncertainty, Cell C acting CEO Jose Dos Santos indicated this week.
The court on Monday deemed the regulations, meant to stimulate competition and enable lower cost to communicate, ““invalid and unlawful”, but the suspended judgment allowed the termination rate of 20c and the asymmetric rate of 44c to be implemented for the next six months, effective April 1.
In February, MTN and Vodacom took Icasa to court, challenging its Second Call Termination Amendment Regulations 2014, which had an aggressive asymmetry rate largely favouring smaller operators, and seeking to have the regulations reviewed and set aside.
The decision would see the regulator, which in March repealed its 2015/16 rate cuts for review, complete a costing exercise and follow “due process” over the interim period and, in effect, “correct” the “irrational and arbitrary” determination of the regulations fairly.
MTN South Africa CEO Zunaid Bulbulia welcomed the South Gauteng High Court’s decision to grant a final judicial review.
“MTN has been vindicated in its decision to take the matter on urgent review and request a final order. MTN now awaits a copy of the written judgment, whereafter it will consider its options going forward,” he said.
Vodacom added that its legal challenge had been justified.
"The view that the call termination regulations are unlawful has been vindicated. We're studying the decision and will comment in more detail in due course," Vodacom spokesperson Richard Boorman said in an emailed response to Engineering News Online.
But, Dos Santos believed that the “uncertainty” over MTRs over the next three years would “continue to make it difficult” for smaller operators to confirm their business plans beyond October 2014, as well as their ability to bring down call prices.
“Unfortunately, Vodacom and MTN have managed to frustrate the long-term process envisaged by Icasa to increase competition in the market, which would have resulted in lower prices for consumers in the long run,” he said.
However, Cell C believed that the ruling made by Judge Haseena Mayat was “a step in the right direction”.
Telkom, welcoming the ruling, said in a statement that it was in the “best interest” of the industry and would “go far” in reducing the cost to communicate for consumers and stimulating competition in the industry.