GRTU charges Vodafone and Go Mobile of abuse of duopoly

GRTU charges Vodafone and Go Mobile of abuse of duopoly in their imposition of mobile telephony “E-talk” and “Ready to Go”

GRTU has today requested Malta Communications Authority and the Office for Fair Competition to order Vodafone and Go Mobile to suspend the increase in prices that the duopoly Vodafone and Go Mobile have decided to charge to all resellers of “E Talk” and “Ready to Go” cards to consumers.

GRTU charges Vodafone and Go Mobile of abuse of duopoly in their imposition of mobile telephony “E-talk” and “Ready to Go”

GRTU has today requested Malta Communications Authority and the Office for Fair Competition to order Vodafone and Go Mobile to suspend the increase in prices that the duopoly Vodafone and Go Mobile have decided to charge to all resellers of “E Talk” and “Ready to Go” cards to consumers.

GRTU on behalf of card resellers contends that these price increases were imposed on the strength of the two firms dominating the market. These dominant firms are imposing their will irrespective of the impact on resellers who have no option but to accept the imposition even at a price which is below the cost of the service they offer.

Please find below copy of GRTU protest to MCA and to OFC.

Dear Sirs,

I write on behalf of the Chamber of Small & Medium Enterprises, (GRTU).

Reference is made to a recent combined decision taken by Vodafone Malta Limited and Mobisle Communications Limited acting as “Go Mobile” whereby they informed their business partners who effectively are businesses retailing the above mentioned entities’ mobile telephony Top-up Cards (“E-talk” and “Ready To Go” respectively), that as from October 2005, the retailer’s commission on the sale of these products is being reduced form 7% to 5%, hence effectively re-pricing their respective products. This information was given by means of two circulars sent from the two said entities, copies of which are being attached hereto.

In terms of Article 5 and Article 9 of Chapter 379 of the Laws of Malta this is a serious case of an anticompetitive measures and an abuse of a dominant position taken by what effectively is a duopoly existing in our country, both entities having over 40% of the market share.

Moreover this information was given without any prior notification to the Director General of the Malta Communications Authority, which is in clear breach of the provisions of Chapter 418 of the Laws of Malta

Therefore in the light of the above I kindly ask you to start investigations forthwith, and in terms of Article 13(1) of Chapter 379 of the Laws of Malta I am instructed to ask the Director of Fair Trading to issue an order for the two said entities to cease and desist from continuing the above described practice with immediate effect, which practice is seriously prejudicing the income of the mobile telephony top-up card retailers, members of the GRTU.