One day after the Telecommunications Authority of T&T (TATT) approved the US$3 billion merger of Cable and Wireless Communication (CWC) and Columbus Communication International, the Barbados Fair Trading Commission (FTC) has followed suit.
In a statement, the FTC said that it had considered the overall efficiencies of the merger and the anti-competitive effects it will create in the telephony and fixed data services and is approving the merger subject to certain conditions.
The regulatory agency has given 14 conditions. Among them is that CWC/Columbus divest one set of fibre cables in the zones where there exists total overlap of the Lime and Flow networks and that customers of the fixed voice residential and commercial business and the fixed broadband residential and commercial business "be released from any contracts, if they so desire, so that they are able to exercise the option to choose a service provider."
The FTC further stated that during the transitional period customers are not to be disadvantaged and that the applicants submit an independent valuation of assets to be divested within 60 days.
"The responsibility lies with the merged entity to find a suitable buyer that has the economic and technical capacity to maintain a viable network. The company or companies interested in acquiring the divested assets must be approved by the Commission before divestment occurs," the FTC said, noting that within 45 days "the merged entity must vest such assets in a holding company."
The FTC will appoint trustees of the holding company who will be responsible for monitoring ongoing management of the divested assets. This will ensure the divested assets are maintained intact and made available for sale, the agency said.
In the event of the failure, by the merged entity, to find a suitable buyer for the assets of the holding company within 180 days of the announcement of the merger decision," the Trustee(s) will also assume the responsibility to seek out a buyer for the assets for a maximum of five years."
The FTC added: "After five years the trustee(s) will place the holding company for sale in the open market."
The regulatory body gas also stipulated that within three months of the date of the merger being effected, the new entity "must offer the same prices, products and service standards to customers in areas not passed by any competing fixed voice network as those offered to customers in areas passed by a competing fixed voice network."
CWC/Columbus announced their merger plans in a joint statement last November. They have said this will enable the combined company to significantly accelerate its growth strategy, improve service delivery to customers in the region, offer customers a comprehensive portfolio of high-quality products and services and strengthen their position against larger competitors.