Telkom to pay R449m fine for abuses - TechCentral

Telkom to pay R449m fine for abuses

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The competition appeal court has agreed to allow Telkom and the Competition Commission to withdraw their separate appeals in the long-running case involving anticompetitive abuses by the telecommunications operator between 1999 and 2004.

TechCentral reported in March that the two parties had dropped their separate applications to the court related to last August’s decision by the Competition Tribunal to hand down a R449m fine on Telkom for past anticompetitive behaviour when the company was owned and effectively controlled by Thintana, whose shareholders were SBC (now AT&T) of the US and Telekom Malaysia.

Telkom will now pay the R449m fine.

Telkom had filed an appeal hoping to have the quantum of the fine reduced; the commission filed a cross-appeal seeking a heftier fine to be imposed. The commission had originally asked the tribunal to impose a find of about R3,5bn.

The complaint that led to the fine was brought to the commission by the South African Value Added Networks Services Association and a number of Internet service providers. The case was delayed for years after Telkom challenged the Competition Commission’s jurisdiction to hear the matter. The operator lost an appeal brought by the commission at the supreme court of appeal in Bloemfontein.

Each party has agreed to pay its own legal costs.

“Telkom will pay the fine of R449m that was originally awarded by the tribunal,” Telkom said. “The terms of the agreement provide for Telkom to pay 50% of the amount within six months of the date of the withdrawal of 12 April 2013. The balance is to be paid within 18 months of the said date of the withdrawal.”

The agreement with the commission does not mark the end of Telkom’s woes. A second case, involving similar complaints but covering a later time period, is still pending. This case is set to be heard by the Competition Tribunal in mid-2013. The principal complainants are Internet Solutions, the Internet Service Providers’ Association, MWeb and MTN.  — (c) 2013 NewsCentral Media

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