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Icasa loses rates battle, but cuts remain

MTN and Vodacom succeeded in quashing rate regulations, but the ruling is suspended for 6 months.

FILE: Members of the Complaints Compliance Committee of Icasa are seen at the Icasa offices in Johannesburg on 12 November 2012. Picture: Sapa.

JOHANNESBURG - The South Gauteng High Court on Monday ruled new regulations governing mobile termination rates (MTRs) are unlawful and invalid.

But the Johannesburg court says the declaration of invalidity is suspended for six months, allowing the Independent Communications Authority of South Africa (Icasa) to go ahead with the planned cuts.

Judge Haseena Mayat says the new rates can be implemented as planned, but has ordered new regulations be drawn up within the six-month period.

Mayat says the new rates will ultimately affect everyone, including consumers, and must be well calculated in order to allow fairness across the board.

Last week, the country's two largest mobile operators, MTN and Vodacom, took Icasa to court over its decision to regulate the fees.

MTRs are the rates operators charge competitors to carry calls on their networks.

The two companies argued new MTR tariff structures would unfairly affect them while benefitting smaller competitors.

Operators such as Cell C and Telkom Mobile are likely to see rates decrease from 40 cents to 20 cents per minute, while bigger companies will pay 44 cents during calls to smaller networks.

The change will still come into effect on Tuesday and new regulations are likely to prevent any return to the previous rates.

The judge ordered all parties to pay their own costs.

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