Cell operators’ Clash
14 July, 2011
Cell operators’ Clash

Magti GSM, one of the key players at Georgian cell market, hardly escaped the black list of the State Procurement Agency of Georgia after it failed to meet its assumed responsibilities against the state tender.  Magti argues that Geocell, its chief opponent cell operator, is responsible for the failure as it blocked Magti’s activity. Geocell dismisses the accusation. 

Magti accuses Geocell in a latent attempt to blackmail Magti in order to be unrivaled in coming tenders.

Magti who had won the state

tender on providing hot-line service to Tbilisi Transport Company last May, informed other communication operators acting in Georgia that a special numeration resource is earmarked for providing free hot-line service to Tbilisi Transport Company and asked them to exempt the hot-line calls from charging starting June 1st of 2011.  Magti pledged to cover all due charges for the entire call traffic. Magti managed to contract 22 companies including fixed lines except Geocell. The latter  turned down the request under the pretext that it has already refused similar requests of other communication operators as far as activation of free of charge numbers was a heavy burden to its billing system and human resources.   Geocell also reminded Magti that a provision of Georgian National Communication Commission (GNCC), has already defined a special free-of-charge numeration resource scheduled to become operational this fall and till activation of this numeration Geocell refrains itself to perform  similar service.

As a matter of fact Geocell went ahead by charging the calls requested by Magti and the latter failed to meet responsibilities assumed in frames of the state tender. The Procurement Agency consequently annulled the tender and was to put Magti on the black list that might affect both Magti’s image and commercial side alike. If been blacklisted Magti could not participate in any tender within a year and enjoy any profit out of it.

Magti accused Geocell in blackmail and appealed to GNCC to settle the dispute and impose sanctions on Geocell for violation of market rules. According to Irakli Lobzhanidze, Deputy Director General of Magti in Marketing, Geocell let Magti down so as to get rid of key competitor. Geocell counterclaimed that Magti had to agree the issue with Geocell not post-tender but before it and in this case Magti could avoid lamentable results it faced.

“No market regulation obliges us to implement free of charge services, “Sandro Sadaghashvili, Head of Legal Department of Geocell, explained to Georgian Journal. “Magti had to agree this issue beforehand, we would explain our terms and agree payment issues and no mishmash would happen. Magti could not dictate its terms, it is a matter of financial agreement. But it behaved impudently as it drew out its own decisions and informed us only afterward.”

Lobzhanidze counterclaims that Magti did not agree the issue beforehand because it was a standard thing and Geocell has no right to dismiss it.

“Geocell has no right to refuse as far as it has been implementing similar service to other market operators. It was a standard agreement, there was nothing new and that’s the reason we did not inform Geocell beforehand. We would agree things beforehand if there was anything new,” Lobzhanidze told GJ.

GNCC discussed the case on July 8, 2011 and approved Magti’s claim only partly: it obliged Geocell to activate the free of charge service to the requested numeration till the special free numeration service [accounted on all companies use for services like hot-line and other special intellectual needs] becomes operational in November of 2011. The key ground was that Geocell is performing similar service to other operators. To avoid further misunderstandings the regulatory body obliged the litigant companies to back the deal though a contract with a detailed description of possible fees and obligations.  More positive result to Magti is that the Procurement Agency did not blacklist the company thanks to GNCC decision.

However GNCC did not impose any sanctions on Geocell for violation of market rules as found apt that Magti had to agree the issues with Geocell prior to the tender.

“GNCC will not interfere in the contract details as it is a matter of private companies to outline provisions of their agreement,” Khatia Kurashvili, PR of GNCC, said.

Ultimately, the questioned contract is not as urgent as it was to Magti as the contract on provision hot-line service to Tbilisi Transport Company is revoked. A new tender has been announced but nobody participated in it as yet. Magti does not plan to appeal to it again.

Print
Other Stories
The World Digital Mining Summit to be held in Georgia
The summit is scheduled to take place between 21st-23rd September in the Hualing Hotel, Tbilisi, Georgia.
Galt and Taggart - Tourism Boom Continues in Georgia
Tourism has become one of the key drivers for the Georgian economy. Galt and Taggart has recently published research about the Georgian tourism sector in the first half of 2018.
"The worst dream for Putin is that Russians want to live in Georgia"
This year, visitors to the Adjara region would notice that there is a boom in construction in and around Batumi.
Underground gas storage facility to be built in Georgia
KfW, a German government-owned development bank signed a EUR 150 million promotional loan with the state-owned Georgian Oil and Gas Corporation (GOGC) for the construction of the first underground gas storage facility in Georgia.
New gambling rules for Georgia
Georgian lawmakers are preparing a new draft law relating to online-casinos and gambling that will seek to curb gambling addiction in Georgia.
How expensive is it to visit Georgia?
The Georgian Lari (GEL) is the official currency of Georgia and is the only legal means of payment in the entire territory of Georgia.
Trade with the EU and the Commonwealth of Independent States (CIS) has grown significantly
Trade with the EU and the CIS has grown by 26% and 33.5 % respectively, says GeoStat, the Georgian National Statistics Office.
The unemployment rate decreases in Georgia
The unemployment rate decreased in Georgia by 1,9% and amounted to 12.1% in the 2nd quarter of 2018 compared with the previous quarter,
Memorandum of Understanding to be signed between Georgia and Malaysia
According to the Georgian Ambassador to Malaysia Nikoloz Apkhazava, Georgia plans to sign a Memorandum of Understanding (MoU) with Malaysia.
“Blauenstein Georgia” due to expand in Georgia
“Blauenstein Georgia” is planning to open more shops in Georgia. It is an agriculture company that sells meat products, meat and convenience food.
The amount of Direct Foreign Investment rises in Georgia
According to the information of the National Statistics Office of Georgia, the amount of direct foreign investment in Georgia has risen
It’s going to get  harder for foreigners to get residence permit in Georgia
It’s going to get harder for foreigners to get permit of residence in Georgia.
Mziuri Park in Tbilisi to be renovated soon
It was the dream of prominent Georgian writer Nodar Dumbadze that when the original Mziuri park was constructed and opened in 1892 that it should be a park for children,
Winemakers to produce Kvanchkara in its place of origin - Racha
Khvanchakara is a semi-sweet Georgian red wine which originates from Racha, in the western part of Georgia. Kvanchkara is made of two types of grape Mujuretuli and Aleksandrouli.
The level of Georgian wine and Chacha exported has increased
The National Wine Agency of Georgia has recently published statistical information about the level of Georgian wine and Chacha exported between January and July, 2018.
New fire engines to be Manufactured in Georgia
The Acting Head of the Emergency Management Agency Shalva Khutsishvili said that the old Zili fire engines (which were made in the USSR) will be phased out and replaced with new ones, manufactured in Georgia.
Georgia witnesses a record number of tourists
The Georgian National Tourism Administration publishes statistical information about international visits to Georgia.
Canadian businessman plans to build a hotel in Bakhmaro
Canadian businessman Vadim Malishev plans to build a hotel in Bakhmaro resort, Guria, in the western part of Georgia.
Coffee Factory will open in Tbilisi in October
The first coffee factory (which will be located on the Kakheti highway) in Tbilisi will open in October.
Places in Georgia where real estate is the most expensive
The real estate market in Georgia is growing annually. In Tbilisi as well as other regions of Georgia new developments are increasingly taking place.
How much does a vacation cost in Tbilisi?
It is the middle of summer and those who have not yet taken a vacation are looking for an appropriate place for sure!
The price for extreme sports in Georgia
Georgia offers a variety of options to extreme sport lovers.
The number of Georgians who own property abroad increases
The number of foreign properties owned by Georgians is increasing.
How much does Taxi cost in Tbilisi?
Stories how Taxi drivers try to deceive passengers and charge them with more money than they should pay are known for everybody all over the world.
What are the highest paid areas in Georgia
According to the data collected by the National Statistics Office of Georgia in the first quarter of 2018 the highest paid jobs in Georgia are found in the financial and insurance fields.
PHOTO OF THE DAY
Exchange Rates
GEL Exchange Rate
Convertor
20.09.2018
21.09.2018
USD
1
USD
2.6179
2.6179
EUR
1
EUR
3.0606
3.0606
GBP
1
GBP
3.4517
3.4517
RUB
100
RUB
3.9087
3.9087
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange
USD
1
USD
2.6179
EUR
1
EUR
3.0606
GBP
1
GBP
3.4517
RUB
100
RUB
3.9087