New TRA regime to encourage competition
The country's Telecommunications Regulatory Authority (TRA) yesterday announced a new regime t?hat will give more freedom to operators to enhance competition but ruled out a third operator entering the market for the time being.
Announcing the launch of the TRA Telecommunications' Competition Framework that will govern all the services and special packages in a transparent manner with more freedom, Mohammed Nasser Al Ghanim, TRA Director-General, said the new regulation will be fully implemented by the end of the year.
Under it, the authority will assess and define the telecom sector's products and services to help protect the interests of both operators and consumers.
Al Ghanim said: "In 2009, we worked to establish a competition framework for our licencees in the country. The law has given us the power to issue specific regulations that deal with competition within the telecommunication sector.
"We have developed this framework in consultation with etisalat and du. It has been approved by the TRA board. It has three instruments – one deals with policy and ex-ante regulation, the second deals with competition safeguards and the third deals with ex-post procedures."
According to him, the new framework will give operators more freedom to introduce new packages and services to stimulate further competition. However, he said if an offer was lower than its cost and intended to hurt a competitor, it would not be allowed.
"Earlier, operators first used to submit the packages they wanted to introduce in the market to the TRA for evaluation and approval. Normally, we assess if these packages contain any anti-competitive element and are sold below cost price. Depending on these factors, we sometimes approve and sometimes reject them," he said.
Al Ghanim said under the new framework, the TRA will assess and define different products and services offered by licencees in the country and will then assess the level of competition in the market.
"If we see the level of competition is high and does not require a pre-approval procedure, we will allow more competition among the operators to offer their services without the TRA's pre-approval."
However, he added, if the TRA finds anti-competitive practices, they will be controlled. "If a customer or a company complains against one or the other party, we will investigate according to procedure and take action."
Al Ghanim also ruled out the entry of a third company in the market for the time being or in the immediate future. When asked if any international company had applied to operate in the UAE, Al Ghanim told Emirates Business: "So far we have no plans or intentions to have a third supplier in the market. There have been rumours that X or Y has applied to operate in the UAE. This is not true. We have not received any request from international companies so far.
"The more competition we have among the two existing players, the better prices will the consumer get. Hopefully, our new regulations will drive the prices down."
However, he said any proposal from international or local companies to enter the market will be looked into.
"It does not relate to a third or a fourth comer. It is a procedure that we have set in the market and it will stay regardless of the number of competitors. We are in the process of organising a national telecom policy that will set the roadmap for the sector ahead. The policy is strategic and is based on basic and specific market conditions."
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