Vitalis Ndalikokule, CEO and secretary of the Namibian Competition Commission.

An investigation by the Namibian Competition Commission (NaCC) has found that a fibre infrastructure agreement between Telecom Namibia, MTC and Namibia Power Corporation (NamPower), has been detrimental to competitors of the two market leaders.

NaCC’s decision comes as a result of an investigation into a dark fibre agreement signed by the three companies.

The commission has given the parties a period of 30 days to make representations before deciding whether to institute legal proceedings against the trio.

NaCC concluded that the agreement, which was signed on 1June 2012 by the companies, is in contravention of various sections of the Competition Act, 2003, including Section 23 (1), which prohibits ‘any agreement or concerted practice between competitors that results in a substantial prevention, restriction, or distortion of competition’.

The investigation, which was launched by the commission in February 2023,alleges that the agreement provided Telecom Namibia and MTC with exclusive use of a proportional share of the dark fibre infrastructure from NamPower, for a duration of ten years from the commencement of the agreement, with an option for an automatic renewal for a period of one year.

NaCC’s investigation further alleged that while NamPower has, since 2019, offered some other market players access to its dark fibre, such access was granted on different terms and conditions to those offered to MTC and Telecom Namibia.

The commission states that the differing terms created an unfair competitive advantage to the two dominant telco players, which it says control more than 80% of the market.

NaCC has also stated that it received information that the telcos failed to adhere to regulations provided by the Communication Regulatory Authority of Namibia (CRAN), prescribing the sharing of infrastructure (Government Gazette No. 6141 of 04 October 2016), which CRAN raised in 2017.

“Following its investigation, the commission found that the three parties entered into an agreement and abused their dominance, in contravention of Section 23(1) read with Section 23(2)(b), Section 23(3)(a), Section 23(3)(e) and Section 23 (3)(f) of the Namibian Competition Act No. 2 of 2003 (the Act), including Section 26(1) read with Section 26(2)(b) and Section 26 (2) (c) of the Act,” stated the commission in a statement shared with ITWeb Africa.

“The commission found that the agreement between the respondents granted MTC and Telecom access to NamPower’s dark fibre on relevant routes, exclusively for a period of more than 10 years (01 June 2012 – 28 February 2023) to the detriment of MTC and Telecom’s competitors. Furthermore, the agreement had the object of preventing competition by virtue of various clauses,” added the commission.

Despite concluding that the telcos engaged in a prohibited conduct, the commission says no final decision has been made and has given the parties a period of 30 days to make any written submissions or oral representations.

“The commission wishes to invoke the process contemplated by section 36 of the Act and afford the affected undertakings or parties an opportunity to make written submissions and oral representations to the commission,” NACC noted.

In response to the findings, MTC has confirmed that it has been contacted by NaCC regarding the opportunity to appeal.

“MTC acknowledges the importance of fair competition in the telecommunications sector and confirms that it is cooperating fully with the NaCC during this process. As part of due process, MTC has been invited to submit written representations and indicate whether it wishes to make oral representations to the Commission within 30 days from receipt of the notice.”

Upon consideration of any written and oral representations by the concerned parties, the commission said it may institute proceedings in the High Court against the parties.