No plans to split the Business of Players in Telecoms Market
CA Chairman Mr. Ngene Gituku( centre) addresses the media during the Press Conference at the Authority. On his left is Director General Francis Wangusi and the Acting Director Consumer and Public Affairs Mr. Christopher Wambua.
The Communications Authority of Kenya (CA) has no intention of splitting the business of market players in the telecommunications sub-sector or take such drastic actions create disruptions that may destabilize dominant market players. Chairman of the CA Board, Mr Ngene Gituku confirmed that Authority’s spirit is to undertake take modest regularity measures that are focused on the progress of the sector.
While addressing a press conference earlier today, the Chairman also confirmed that CA plans to release the Competition Study in May. The study, carried out by Analysys Mason, on behalf of the Authority, aims at establishing the degree of competition and its effectiveness in various telecommunications markets in the country.
“Dominant Market Power and Regulated Services reports will be released once the required processes as stipulated in the constitution, ICT sector law and the Fair Competition and Equality Treatment as well as the Tariffs Regulations have been concluded.” Mr. Gituku said.
The assurance came amidst claims that the report had already been released by the Authority. Mr Gituku, said, “The Authority is targeting to finalize and release the final report in May 2017 after consultation with stakeholders in line with constitutional requirements.” Mr Gituku noted that the study was undertaken in close consultations with the industry and the Competition Authority of Kenya (CAK) as envisaged in the ICT sector law. CAK reverted to CA with comments on the report on 6th March 2017 and the report is now under review by CA.
The law mandates CA to develop ex-ante competition safeguards to prevent any potential abuse of dominance. The safeguards are meant to deter the degeneration of dominance into anti-competitive behaviour to the detriment of sectoral growth, investments and consumer welfare.
The Authority has affirmed that dominance in any market segment is not in itself an offence. It is the abuse and the potential of abuse of dominance that must regulated. Uncompetitiveness in the sector has the potential to compromise consumer welfare in terms of limited access to services, poor quality of service, high tariffs and limited choice, if it is not regulated. Abuse of dominance could also lead to barriers to entry into the market and ultimately result in market failure.
The objectives of the study include the identification of players and respective market shares, as well as market barriers that may prevent entry or competition or growth of players. The study is also expected to provide proposals on elimination of the identified barriers, establish anti-competitive behavior and also recommend regulatory response to competition issues that will have been identified in the existing regulatory framework.
The Authority’s goal is to maintain a competitive telecommunications landscape, which promotes consumer welfare and lays a conducive environment for investment in the sector. Such a landscape serves to foster growth of the sector and by implications the socio-economic development of the country. The Authority’s focus is to stimulate innovation and catalyze other sectors of the economy.
The Full Statement can be accessed from here.