ISPA welcomes fine imposed on wailing Telkom

Its hardly a week when the Competition Tribunal fined Telkom’s South Africa R499(US$61,184,426.84) for monopoly practices between 1999 and 2004 in South Africa.The Internet Service Providers Association (ISPA) termed the penalty as essential for streamlining the telecommunication industry.

In a statement, ISPA said it was happy with the ruling and the fine imposed.

“I will like to thank the Competition Commission’s commitment in dealing with this issue. It has been a long battle that ISPA and other complainants joined in 2002 and now the end is more important as competition in the market will be on mutual grounds,” ISPA co-chair, Marc Furman, said.
“ISPA extends its grateful to all the other parties to the original complaint, especially ISPA and SAVA member’s who took their time and suffered losses in testifying against Telkom,” Furman noted.
Experts view it as a smart move in dealing with competition cases and expect it to be a lesson to the entreprises in country and other African countries that engage in monopoly. The vice tends to derail creativity, innovation and socio-economic progress that fuelled competitions in the market.
Furman further stated he hopes the judgement would mean a lot to Telkom and other firms in the telecommunications industry to stop practicing such unlawful acts.
The case dates back to February 2004 when South Africa Vans Association (SAVA) and 20 other Internet Service Providers presented the case to the Competition Commission who referred it to the Tribunal.
Telkom was accused for refusing to supply facilities to independent Value Added Network Services (VANS) providers, stopping its customers from dealing with them directly in addition to hiking price for services.
In the ruling, the Tribunal found the telecommunications service provider guilty of monopoly practices and termed it as “unfair” as it interferes with business development in the country.
Telkom South Africa has 18 months to settle the fine of R499 million (US$61,184,426.84) following the ruling. Half of the penalty should be paid within six months while the rest at a period of 12 months after the previous payment.
Reports from ISPA state the company is analysing the judgment before it comes up with a decision. It further revealed it has the ball in their court and could consider appealing.

At the same time, those affected by Telkom’s activities may use the decision to sue the company for damages, according to the reports.

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