Row between Batelco and Bahrain TRA escalates

Batelco accuses Bahrain TRA of blocking price cuts and new service launches

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By  Mark Sutton Published  March 10, 2008

The row between Bahrain's Telecoms Regulatory Authority (TRA) and leading telecoms operator Batelco continues, with Batelco now accusing the regulator of blocking price cuts for consumers in the Kingdom.

In a statement released late on Thursday, Batelco claimed that it has been "stopped on a number of occasions from launching new products and lowering tariffs by the TRA". Batelco claims that it is willing to cut prices for services, but is being blocked by the TRA which has approval of Batelco's tariffs.

The statement follows a threat of legal action action by the TRA against the operator, after Batelco ran advertisements for a new broadband service that had not been approved by the TRA.

Under the terms of Batelco's licence the company must submit all tariffs to the TRA for approval prior to publicly launching them. The TRA said that it felt that by advertising the package before approval, Batelco was attempting to pressurize the TRA, and threatened legal action if the advertisements were not withdrawn immediately.

Batelco has responded with a statement saying that it is confident that it has complied with the law, and calling on the TRA to allow greater competition for the benefit of consumers and to stimulate economic growth.

Batelco Chief Executive Peter Kaliaropoulos said in a statement: "We must not lose sight that aggressive competition benefits the consumers and makes Bahrain a more attractive destination for companies to establish their regional headquarters and contribute to the Kingdom's economy.

"It is definitely in the interests of consumers and other licensed operators to clearly know what Batelco is willing and able to offer in the market place," said Kaliaropoulos.

"As we have shown the public with the BD10 internet offer, 50% reductions in business internet services and ongoing promotional deals offering better value, Batelco is prepared to lead by example and stimulate a stronger competitive environment," he added.

The advertisement for the Broadband Plus service promised up to eight hours free calls to mobiles, unlimited free local calls, up to 70% off international calls, and internet connection speeds up to 2MB, while stating that the service would be only be available if approved by the TRA.

According to the TRA, the new tariff had been submitted for approval in December and was rejected over concerns that it might be detrimental to competition. The proposal was submitted again on 28th February, although Batelco, then ran the advertisements before the standard 30 day assessment process was up.

Alan Horne, TRA General Director said: "I have to say that I am disappointed by this latest action on Batelco's part which, from our perspective, seems to be an attempt to artificially create pressure upon TRA to approve this package. It will not work."

The row comes after the TRA released its own proposals to promote a fair competition, which included a possible relaxation of the requirement for TRA approval of Batelco tariffs. Horne's statement seems to suggest that a relaxation of the rules may however be conditional.

"TRA's recent proposals to relax the tariff approval process will require a level of confidence that Batelco will abide not just by the rules but also by the spirit of the rules TRA puts in place", said Horne. "This will require a mature and responsible attitude and approach from all operators and TRA is hopeful that Batelco will lead by example."

The TRA has previously voiced concerns about competitiveness and access to alternate operators in Bahrain. In February Horne told Reuters that some critics saw Batelco and Zain Bahrain as operating a "cosy duopoly" and Batelco, alongside other Middle East operators, has been criticized by the OECD for the high price of its broadband services.

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