Batelco lashes out at TRA’s “baseless” allegations

Bahraini incumbent argues that regulator reneged on earlier agreement regarding access to international cables

Tags: BahrainBahrain Telecommunications CompanyComplaintFineTelecommunications Regulatory Authority - Bahrain
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Batelco lashes out at TRA’s “baseless” allegations Sheikh Hamad bin Abdulla Al Khalifa, chairman, Batelco, said the fine would deter investment in Bahrain’s telecoms sector.
By  Roger Field Published  September 16, 2009

Bahrain’s incumbent telecom operator Batelco has hit out at the country’s regulator for issuing it with its biggest ever fine for allegedly preventing other operators from accessing the country's international cables.

In the latest public dispute between the operator and regulator, Batelco denied that it had hindered access of other operators to international cables, and went on to accuse the TRA of reneging on a 15 year contract agreed between the two parties in 2004.

Batelco said in a statement released today that it had “at all times complied with its obligations under the law for the provision of access services to the FLAG and other international cables on terms and at cost oriented prices” already approved by the TRA.

“The facts are that the TRA in 2004 approved a contract between Flag and Batelco for the introduction of this international cable, mandating changes to the contract before its approval. The TRA also introduced regulations for Batelco to provide access to other licensed operators for such cable,” said Sheikh Hamad bin Abdulla Al Khalifa, chairman, Batelco.

“Batelco took the decision to enter into the TRA approved contract and invest $50 million to bring this international cable to Bahrain for the benefit of the Kingdom and its citizens,” Al Khalifa added. “Now the TRA is seeking to arbitrarily change a commercial contract and mandate new arrangements in an unjustified manner.”

Gert Rieder, CEO, Batelco, added that the company had fulfilled its obligations agreed under the 2004 contract, and that under the existing framework Batelco is unable to offer third parties direct access to the Flag cable.

“We must stress that we never had an exclusive deal with Flag and access to international capacity through this cable and other cables have always been available for other licensed operators.  Based on prices set by the TRA, OLO’s can now purchase this capacity from us on wholesale terms,” he said. 

Al Khalifa added that the TRA’s decision to “arbitrarily” alter an approved contract also demonstrated a failure to protect companies in the telecoms sector, which could in turn deter investment in the industry.

He also suggested that Batelco could reconsider further investments in international cables in light of the TRA’s decision. “Batelco is currently in negotiations with two consortiums to bring two new international cable systems into Bahrain. This behaviour by TRA is contrary to Bahrain’s 2030 vision and creates concerns for long term telecommunications infrastructure investments in the Kingdom.”

The TRA was unavailable for immediate comment.

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