The Competition Commission of Pakistan (CCP) raised concerns on Monday regarding telecommunications mergers, cautioning that such consolidations could potentially limit consumer options. The regulatory body specifically referenced the proposed acquisition of Telenor Pakistan (Private) Limited (TP) by Pakistan Telecommunication Company Limited (PTCL).
According to the CCP, a preliminary investigation has indicated that the planned acquisition of Telenor Pakistan and Orion Towers Private Limited (OT) by PTCL might lead to a notable reduction in competition within the telecommunications sector.
PTCL, a publicly listed company established in 1995, offers a range of telecommunication services across Pakistan, including cellular mobile telephony, Wireless Local Loop service, Direct-to-Home television service, and financial services.
Both Telenor Pakistan and OT, wholly-owned subsidiaries of M/s Telenor Pakistan BV, provide cellular mobile and allied services throughout Pakistan.
PTCL has already been identified as a Significant Market Power Operator in various segments by the Pakistan Telecommunication Authority (PTA). Given the existing market overlaps, the CCP has concluded that if the acquisition proceeds, competition could diminish, resulting in fewer choices and options for consumers, particularly in markets with limited competitors. This scenario could potentially lead to adverse outcomes for customers.
The acquisition of M/s Warid Telecom (Private) Limited by M/s Pakistan Mobile Telecommunications Limited in 2016 had already reduced the number of network operators in the industry. With the proposed merger, one of the remaining four players would be eliminated, further consolidating the market.
The CCP is concerned that this reduction in competition may lead to higher prices, reduced choice, or diminished quality for customers. As a result, the regulatory body has decided to refer the transaction for an in-depth Phase 2 analysis.
The move underscores the CCP’s commitment to ensuring fair competition and protecting consumer interests within the telecommunications sector.