In November 2014, in separate media releases and through direct communications with their respective groups of customers, Cable & Wireless Communications Plc (CWC) and Columbus Communications announced plans to create a combined business operation in the Caribbean and Latin America.
The companies stated, among other reasons, that the proposed transaction would result in more benefits for consumers, stronger networks and more investment and innovation. While the providers have not made specific submissions to the regulator, Ectel deems the matter to be of sufficient public interest to provide an initial statement.
The Eastern Caribbean Telecommunications Authority (Ectel) has reviewed the preliminary information available, and in consultation with the National Telecommunications Regulatory Commissions in its Member States, notes with deep concern that this development can potentially result in a negative impact on competition.
It can also reduce choice by consumers, of both services and service providers. Since the advent of liberalisation, the prices of all telecommunications and ICT services have been significantly reduced due to competition in the region.
Ectel is mindful that over the past 15 years there has been major development in the telecommunications sector under the guidance of independent regulators in the Eastern Caribbean. Increased monopolisation therefore can erode the gains made by liberalisation, and create challenges for the entrance of new service providers.
Under the current regulatory regime, telecommunications licence holders including Columbus and CWC may be in breach of their licences, if they engage in activities which can have the effect of unfairly preventing, restricting or distorting competition. Upon the advice of Ectel the ministers responsible for Telecommunications can intervene to protect the market in the Ectel Member States.
Ectel and the NTRCs will therefore carefully monitor the situation and advise the Ministers accordingly to ensure that consumers continue to benefit from a choice of service providers and services.The recent announcement to combine businesses by the two companies can have a negative impact on the telecoms sector, and this has provided further impetus for the revision of existing legislation and rules governing competition in the sector, including the proposed new Electronic Communications Bill.
Ectel and the commissions will intensify collaboration with other regulators in the Caribbean region to seek further information in order to advise the Member Governments on the issue. Additionally, Ectel has also urged the OECS Commission to move with some haste to establish the OECS Competition Commission.