The government has decided to frame competition rules in an attempt to bar telecom companies from any possible monopolistic practice in the new telecommunication policy 2015.
Officials familiar with the development said that the Economic Coordination Committee (ECC), which approved the policy in its meeting on December 11, has directed the IT ministry to have it vetted by the Law, Justice and Human Rights Division before enforcement.
Telecom Policy 2015 termed positive development
The new policy was initially considered by the ECC on August 12, before the body directed the IT ministry to review the draft policy document in light of the observations and suggestions made during the meeting.
The ECC had specifically directed the IT ministry to ensure that provisions of para 5.1 of the policy are not in contravention with the Competition Commission Act 2010. It also directed the ministry to review para 5.13 regarding industry status in context of associated fiscal aspects.
The IT ministry informed the ECC that concerns regarding the competition commission were discussed with Special Assistant to the Prime Minister on Law, Justice and Human Rights on September 1, 2015.
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Subsequently, the Law, Justice and Human Rights Division had confirmed that the federal government (Ministry of Information Technology) was well within its right to frame the rules regarding competition matters related to telecommunication sector.
What Dar said
Finance Minister Ishaq Dar, in a meeting of ECC, held on August 12, had opposed the proposal of establishing a parallel competition framework in an attempt to take action against telecom companies that are involved in monopolistic practices.
Dar, who is also the chairman of ECC, had said that the proposed new telecommunication policy did not clearly reflect the structure of tax rationalisation framework. The policy should be reflective of commitments rather than proposals, he stressed.
He was of the view that the classification of telecommunications as an industry would not be appropriate and suggested that both fiscal and constitutional aspects of the policy were important, which should be addressed.
Telecom market: Dar opposes parallel competition framework
Dar pointed out that the establishment of a parallel competition framework, as envisaged in the draft policy, would not be an appropriate step as the Competition Commission of Pakistan (CCP), being a statutory body, had already been working with powers to perform such functions.
Secretary of the Ministry of Information Technology explained that a clause, pertaining to the competition framework, was part of the policy in view of the legal obligations of the Pakistan Telecommunication (Re-organisation) Act 1996, which was amended in 2006.
However, the Finance Division secretary argued that financing and licencing targets and goals were not visible in the proposed policy, nor was the distinction between information technology and telecommunication appropriate, and suggested that there should be one ICT policy. He said the Finance Division would give suggestions relating to some clauses of the policy.
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The ECC was updated on the process of consultation with the stakeholders, undertaken by the Ministry of Information Technology, for formulating the telecom policy draft.
The major goals of the policy approved by ECC include efficient markets with straightforward entry and existence of qualified entities that have sufficient financial resource to invest in and deliver quality service.
It focuses on widespread availability of affordable brand services provided over fixed or mobile networks with characteristics that support contemporary and new digital applications and contents.
Policy’s objective is allocation and assignment of spectrum to maximise social and economic benefits derived from the use of this scarce resource and a legal and regulatory environment that further promotes the development of efficient markets and that safeguards consumers.
It will ensure available and affordable telephony and universal broadband access to cover undeserved and un-served population.
Published in The Express Tribune, December 24th, 2015.
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