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Egypt's mobile carriers accused of forming a cartel: ECA

Egyptian Competition Authority accuses three mobile operators of forming cartel, illegally burdening customers

Ahram Online, Sunday 8 Dec 2013
Vodafone, Mobinil and Etisalat Logo
Vodafone, Mobinil and Etisalat Logo
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Egypt’s three mobile operators have been referred to the public prosecution on accusations of monopolistic practices, following a request by the Egyptian Competition Authority (ECA), the regulatory body stated Sunday.
 
The ECA added that the Egyptian Company for Mobile Services (Mobinil), Vodafone Egypt, and Etisalat Misr have illegally formed a cartel to collectively raise prices for mobile services, costing consumers more than LE500 million ($72.6 million) annually.
 
Last year, the ECA opened an investigation regarding mobile carriers after receiving a notice accusing them of simultaneously burdening consumers with a stamp tax.
 
"Even though implementing a stamp tax in itself is not illegal, the way the companies went about it breaks the cartels law," said Mona El-Garf head of the ECA, in the statement.
 
In March 2012, the mobile operators agreed to levy a stamp duty of LE0.5 per month per customer, ahead of notifying the National Telecommunications Regulatory Authority (NTRA).
 
The operators claim that though they had hitherto borne the burden of the tax on behalf of their subscribers, the current economic situation obliged them to charge their customers.
 
The simultaneous imposition of the stamp duty by all three companies on pre-paid subscribers at the exact same rate is a violation of Article 6 of the Egyptian Antitrust Code, according to the authority.
 
Mobinil is majority-owned by France’s Orange SA, which owns 93.92 percent of the shares. The British multinational Vodafone Group owns 55 percent of its Egypt subsidiary. Etisalat Misr is 66 percent owned by United Arab Emirates-based Etisalat Group.
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