PCC opens 'preliminary' probe into Dito's antitrust complaint vs Globe, Smart
MANILA, Philippines — Antitrust regulators said Friday they will open a preliminary inquiry into a complaint filed by nascent telco player Dito Telecommunity, which accused long-serving incumbents Globe Telecom Inc. and Smart Communications of abusing their market dominance in their interconnection agreements.
In a statement, the Philippine Competition Commission (PCC) said it “found reasonable grounds” to look into the allegations of Dito, the China Telecom-backed telco start-up of Davao-based businessman Dennis Uy, an ally of former President Rodrigo Duterte.
The PCC said its enforcement office will check if Globe and Smart violated the Philippine Competition Act. In its complaint filed before the PCC, Dito claims that only 30% of calls originating from its network are able to connect with Globe and Smart users.
The PCC said it will coordinate and consult with the National Telecommunications Commission, the telco regular, and other relevant authorities “for regulatory and technical considerations” as it conducts the investigation.
“The PCC takes complaints of anti-competitive behavior very seriously,” the commission said.
“Without prejudging the outcome of the (enforcement office’s) investigation, the PCC reminds players with substantial market power, not only in the telecommunications industry but across sectors, of their responsibility to compete fairly and to adhere to the principles of competition,” it added.
Interconnection between telco companies is required under the law. The interconnection issues have been going on for “almost a year”, Dito said, adding that the problem has been stunting the company’s growth.
That said, Globe and Smart would be in big trouble if the PCC sides with Dito and finds that the two telco giants are preventing Dito users from making successful phone calls. Smart is the wireless subsidiary of PLDT Inc.
Meanwhile, Globe has asked the NTC to compel Dito to pay for interconnect penalties amounting to P622 million brought about by “fraudulent calls placed through DITO's network to Globe, bypassing proper voice traffic channels.”
READ: After Dito's antitrust complaint, Globe wants them to pay P622-M penalty
Reacting to the PCC’s move, Dito chief administrative officer Adel Tamano said in a statement that “today is a historic day for Filipino telco subscribers.”
“From the onset, this case has not been about mere commercial terms but rather is about public interest in interconnection between the telco players and fostering genuine competition in the industry,” Tamano added.
Sought for comment, Terry Ridon, convenor of InfraWatch, an infrastructure think tank, explained that the PCC’s preliminary inquiry is essentially just the first step towards determining anti-competitive behavior exists in contracts relating to interconnection among telcos.
“This is by no means an initial victory for Dito, as this merely provides the PCC an opportunity to further study the complaint, particularly the specific market and the commercial arrangements on which the complaint is based,” Ridon said. — Ian Nicolas Cigaral with Ramon Royandoyan
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