Communication Regulatory Body’s Activity Questioned
03 October, 2013
Communication Regulatory Body’s Activity Questioned
The case of activities of the Georgian communication regulatory body may be transferred to the Prosecutors’ Office for further investigation as the Temporary Investigation Commission of the Parliament, perusing activity of Georgian National Communication Commission at the moment, finds that certain breach of law the GNCC committed is of criminal nature. In particular, violation of market competition rules, protectionism, murky tenders and suspicious tariff calculation tools cast a shadow on the GNCC activity.
GNCC activity has long been a subject
of ardent discussions and suspicion of economic analysts who argued that the communication regulatory body fell far below its role of independent and unbiased referee. Opponents believe the GNCC was guided by the ex-ruling party, polluting rather than insuring fair market competition. Association of Young Financiers and Businessmen for example insisted the GNCC is the culprit that a Georgian consumer is charged by one of the highest tariffs [globe over] for cell calls. Market operators also claimed discrimination and unfair treatment some trying to find truth through courts. However, the outcry against GNCC has remained as a voice in the wilderness during the previous regime. As the power changed past fall a special investigative parliamentary commission was set up to delve in the GNCC activity. Having scrutinized the issue, parliamentary commission found GNCC activity even criminal in several aspects which will be passed to Prosecutors office. As Tina Khidasheli, Chairperson of the said Temporary Investigation Commission at Parliament, is reported by Commersant.ge, GNCC very likely misshaped itself into some sort of punishing body to market operators instead of operating as a protector of their rights as one normally would have expected.
First of all, investigation commission questions relevance of the tender held in 2010 to hire an operator company for performing service to “porting” of phone numbers. While Georgian legislation requires selection of the best out of reputable and experienced companies who offer best pricing terms, a completely unknown operator making the worst pricing proposal won the tender in completion with one of the prominent international players in porting business. As a result, according to Khidasheli, now Georgian companies pay GEL 7 million based on the entire available number pool, making 6.7 million throughout country, while they might pay just GEL 660 thousand for porting service of 124 thousand numbers (as the defeated bidder offered). The extra expenses of cell and fixed line operators reflect in the consumer tariffs eventually and they float high. Another major question falls on regulatory tariff that GNCC charges market operators for service. Investigative commission found out that GNCC artificially increased the regulatory tariff rate from 0.5% to 0.75% and thanks to adopting sophisticated calculation method it enjoys more than 1% in fact. Commission also doubts that the high regulatory tariff rate is related with allegedly falsified cell license purchase from the Prosecutors’ Office fund. This will be estimated as a crime if confirmed.
The third major malfunction of GNCC is the protectionist policy it applied toward Beeline cell operator thanks to which two other cell companies Magti and Geocell practically subsidize the favorite as far as they pay by 3 tetri higher inter-company-connection tariffs to Beeline than beeline pays them back.
GNCC did not make comment to Georgian Journal at the moment saying that it prefers to remain silent until it presents counter arguments at the special parliamentary commission meeting scheduled on 5 October. “We do have answers on all questions in fact but we do not make comments until the meeting of the special commission where GNCC is called to respond to the Parliament,” a spokesperson of GNCC Khatia Kurashvili said.
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