Pursuant to Law No.10/2003, the NTRA is in charge of monitoring and protecting competition policy in the Telecom market. Accordingly the NTRA sets the limits for free competition, which if exceeded will result in the occurrence of monopolistic practices in any of the fields regulated by Law.
A general framework for free competition policy is issued by NTRA to determine the policy to be followed to ensure a free competitive and liberalized environment.
First: Main Definitions
There are two aspects to definition of relevant market - the product, including a service, and the geographic area in which it is applied.
Barriers to market entrance:
These are barriers to new entrants that include and are not confined upon the following:
- Governmental restrictions such as monopolistic privileges or licensing procedures;
- Macro-economies where the service costs decrease by increasing the outcome production;
- Absence of transitional conditions for new competitors, to enable them to spread the service and complete their own coverage plan;
- Ownership of scarce resources such as frequencies, numbering, and rights of way that may affect the availability of the competitor’s basic inputs and outputs.
Market power means the ability of a company or an institution to raise the prices independently above the market levels for a non-temporary period without losing customers or sales in return.
Significant Market Power:
The significant power is measured by different methods including:
- The percentage of market share, depending on the study of the telecom sector in Egypt;
- The volume of investment and profits compared to the volume of the market;
- Vertical integration of services and bundling of services packages;
- The ability to influence the market and to control means of service access.
- Exclusivity of experience and knowledge.
The situation in which the influence of the market power prohibits the existence of an effective competition in the relevant market.
The networks or services provided by one or by a limited number of service providers and which are irreplaceable on the economic and technical levels.
Second: General Framework of Competition and Anti-Monopoly Policy
The licensee shall not, solely or jointly with others, practice, continue in, or intentionally accept any harmful or anti-competition practices, including the following:
Abuse of Dominance Status :
The licensee shall not abuse the dominance status by means of practices that are detrimental to the concept of competition, such as refusing or delaying the provision of basic facilities to the competitors. The licensee shall particularly abide by the following:
- Provision of basic services and facilities to the competitors at affordable prices;
- Non provision of services at prices lower than cost-based prices with the purpose of causing dumping;
- Non-bundling of services packages with the purpose of attaining exclusivity;
- Setting no restrictions on subscribers’ shifting to other competitors;
On violation of these regulations, the licensee shall immediately respond to the NTRA resolution in this regard. The licensee shall also compensate other subscribers and competitors harmed.
Refusal to Supply Basic Facilities
The licensee shall abide by the following:
Cooperating with the other licensees to enhance telecom services;
Making its network and basic facilities available to the competitors, without unjustified delay and at affordable prices;
Non-discrimination between the competitors in provision of basic facilities;
Adherence to interconnection agreements with the other licensees, providing these agreements shall be within the license conditions and approved by the NTRA.
Cross - Subsidization
- The licensee, providing more than one authorized telecom service shall not subsidize one of the services at the expense of another;
- The licensee enjoying the significant market power shall separate the accounts of its different services and activities. NTRA enjoys the right to audit these data.
- In cases of cross subsidization that result in harming or curbing competition, structural separation (on the financial and organizational level) shall be considered, NTRA is the decision maker in this case.
Vertical Price Squeezing
- When the licensee competes in offering lower-activity services (retail services) which require higher-activity services (wholesale services), the licensee shall ensure the non occurrence of vertical squeezing of prices in specific services that are basic inputs to the competitors in the lower level markets where these same inputs are used by the licensee in the same market.
- The licensee shall not provide services lower than cost-based prices in a way that harms the competitor with the purpose of monopolizing the market.
- Before service provision, the NTRA shall approve the cost- based tariffs proposed by the service provider.
Misuse of Information
- The licensee shall not misuse the other competitors’ information, which has been obtained in the context of the interconnection arrangements.
- The licensee has no right to retain subscribers by means of long-term agreements, which makes it difficult for the customer to shift to another operator or service provider;
- The licensee shall not conclude agreements that define the technology or equipment provided to the customer;
- The licensee shall allow the option of Number Portability to the new competitors so that any subscriber can shift to another operator without changing his/her number
The licensee shall have the right to provide services packages provided that they have no harmful effect on the consumers or the competitors, according to the following conditions:
- The service package shall cover the costs of services;
- To provide the option of individual services;
- The competitors shall be able to offer their services packages.
The licensee shall not conclude competition-curbing agreements which may include:
- Price determining agreements in an unrealistic manner;
- Tender manipulation agreements among the competitors;
- Market segmentation agreements;
- Independent agreements with any other service provider granting exclusive usage of utilities.