Pelephone ordered to pay USD40m royalties to MoC

14 Sep 2010

An Israeli court has ordered Pelephone, the mobile subsidiary of fixed line incumbent Bezeq, to pay the government ILD150 million (USD40 million) relating to unpaid royalties. According to Reuters, the payment is for royalties owed by Pelephone for the period between October 1994 and February 1996, and the judgement against the cellco comes despite it claiming that it was not obliged to make payments during the period in question as it did not have an operator’s licence. Having filed the case some ten years ago, in 2000, the Ministry of Communications (MoC) said that its decision to pursue the matter was a ‘clear message that the government stands up for its rights and takes all measures to collect royalties owed it’.

According to TeleGeography’s GlobalComms Database, Pelephone is Israel’s third largest mobile operator by subscribers , reporting a customer base of 2.81 million at end-June 2010, giving it a market share of 28.9%. Market leader Cellcom and second-placed Partner Communications meanwhile held 34.4% and 31.8% of the market respectively at that date, while iDEN operator MIRS Communications accounted for the remaining 4.9%.