Africa

Africa’s Biggest Telco Is Suing Ghanaian Authorities In Monopoly Scuffle


July 6, 2020

The MTN Ghana monopoly debate has taken quite the turn. The telco is suing Ghana’s telecoms regulator, the National Communication Authority (NCA), for declaring it as a Dominant/Significant Market Power (SMP) in Ghana’s telecom space.

MTN Ghana, the Ghanaian subsidiary of Africa’s biggest telco, MTN Group, currently controls nearly 70 percent of the country’s data subscriptions market share and just under 60 percent of voice. It also owns the leading mobile money platform in Ghana, by far outstripping other telcos and even outdoing banks.

MTN Ghana’s mobile money service accounted for more than 90 percent of the country’s mobile money deposits with a combined value of USD 453.8 Mn as of October 2017. AirtelTigo claimed second place, controlling 3.6 percent of the total, while Vodafone took third place, with 2.5 percent.

Last month, it was revealed that Ghana has decided to adopt a set of policies to dilute the dominance of MTN in the country’s telecommunications market, the government said in a recent statement. 

“The NCA will, in the coming days, begin the implementation of specific policies to ensure a level-playing field for all network operators within the telecommunications industry,” a portion of the statement reads.

The NCA had declared MTN a significant market power, making it necessary for the regulator to take corrective action to allow more market competition and prevent the creation of an unhealthy monopoly that might suffocate the competition and lead to poor standards of service and bloated pricing, ultimately.

The corrective interventions talked up by the NCA include implementing a “favourable” connection rate for disadvantaged operators, the setting of minimum and maximum pricing on all telecoms and mobile money services, and ensuring that the various operator vendors are not subject to exclusionary pricing or behaviour.

But MTN Ghana is now seeking judicial review of this development. In simpler terms, MTN Ghana is taking the NCA to court for designating the telco as a dominant market power on the cusp of full-on monopoly.

In a statement issued by the company’s Corporate Services Executive, Samuel Koranteng, the telecom giant argued that the designation essentially provides that a target or special regulatory restrictions would be, at any given time, enforced possibly on MTN Ghana to potentially limit the company’s growth, performance, innovativeness, and its competitiveness in the telecoms market.

It further stated that after much consultation, and as a last resort, MTN Ghana made the difficult decision to resort to the Law Courts for redress in the form of a judicial review of NCA’s decision. This, it claims, would ensure the observance of the requirements of procedural fairness.

“We believe that the regulatory authority must follow the applicable legislation and global industry best practices. As a responsible and ethical leader, MTN is neither aware of any industry economics/market study to establish market failure nor has MTN taken any steps or engaged in anti-competitive behaviour,” reads the company’s statement.

The telco, however, acknowledges that despite taking to the courts, it is also open to dialogue that can bring about a speedy resolution of the matter.

In Kenya, the telco, Safaricom, has a similar grip on the country’s telecoms and mobile money markets, controlling 68 percent and 98 percent of both segments respectively. Attempts to check Safaricom’s dominance in Kenya haven’t yielded much fruit. 

The NCA seems to be wary of MTN Ghana pulling off a Safaricom in Ghana and has moved to check its dominance early. But the Ghanaian arm of the South African telco is fighting back, albeit maintaining that it is not opposed to steps by the regulator to further enhance Ghana’s telecoms industry provided those steps are fair and legal.

The emergence of another court battle would add to the telco’s growing list of ongoing legal faceoffs, as MTN Group is also currently embroiled in an anti-terrorism suit filed in a US court.

Featured Image Courtesy: TandaaBiashara

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