THE Pancyprian Association of Retail Telecom Companies (PARTC) yesterday welcomed the massive fine imposed on local telecoms monopoly CyTA this week, but wondered why action had been so long in the coming.
On Tuesday, the governmental Competition Commission slapped a mammoth £20 million fine on CyTA for abusing its dominant position in the market, raking in over £133 million in net profit in the past two fiscal years.
Following the imposition of the penalty, a number of deputies rounded on CyTA, saying the semi-governmental organization should readjust call rates to consumers’ benefit.
This prompted PARTC president Ioannis Diakos to wonder yesterday “what were parliament and deputies doing all these years when approving CyTA’s budget? Were they misled, as they now claim? Do they mean to tell us that they did not know what bills they were passing?
“While welcoming the commission’s decision, we cannot help but wonder why it was so late in coming.”
Diakos went on to suggest that “games” were being played behind the scenes. He said that when his association turned to the Competition Commission in late 2000, the commission’s report did not find CyTA accountable for abusing its dominant market position. But now, went on Diakos, the commission conducted an investigation on its own initiative and reached the exact opposite conclusion. “What happened in th emeantime?” asked Diakos. “Why the sudden shift in stance?”
PARTC’s main gripe with CyTA is that it used its assets to enter the mobile telephony retail market, dealing a devastating blow to retailers, who simply could not compete. “For example, they sent out 400,000 leaflets to customers – their subscribers essentially – advertising their mobile services.”
As things stand, the £20 million fine, if paid, will go directly to the state coffer and it would take additional legislation to return to consumers the overcharging imposed on them over the past year. One hike involved raising the monthly fixed fee for a telephone line from £1.75 to £5.
For its part, CyTA has described the commission’s decision as “unjustified” and says it will appeal to the Supreme Court. PARTC has also long since appealed to the Supreme Court, though for a different reason: to reverse the commission’s findings in early 2001 that CyTA was not at fault.
Sources suggested that the Competition Commission’s slap-in-the-face to CyTA was not, as some pundits have said, related to the government’s concerns to meet EU accession criteria by ending monopolies in the telecoms sector. Rather, they said, the move was more tangibly linked to the recent decision to allow one more service provider to enter the market. With two corporations, that might leave mobile retailers out of the loop.
Another question raised by Diakos regarded the manner in which CyTA was fined. “The penalty was most severe – almost the maximum penalty the Competition Commission is allowed by law to impose. And to cap it all, it was given no prior warning. It’s as if CyTA is being treated as a criminal.”
Asked what measures PARTC would take in the event CyTA ended up not paying the fine, Diakos said the association would consider these matters if and when they came up. In the past, PARTC members had “occupied” a CyTA outlet, and it took 20 police officers to end the sit-down protest.
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