Bakcell awarded compensation in interconnection claim against Azercell

11 Feb 2013

Azeri mobile operator Bakcell has won its interconnection tariff-related lawsuit against rival operator Azercell, online news journal Trend.az reports. In the case, originally filed in July 2011 at the Baku Administrative-Economic Court #1, the authorities ruled in Bakcell’s favour on 6 February 2013 and awarded the cellco AZN15 million (USD19.13 million) in compensation and damages.

Commenting on the decision, Bakcell chief executive officer Richard Shearer said: ‘We are very pleased with the court decision and the fact that justice is served. Azercell has abused its dominant position and placed smaller operators at a disadvantage. The Court has [redressed] this situation and punished Azercell for its abusive behaviour. I would like to emphasise that as a result of this lawsuit the consumers i.e. the regular users of mobile communication services, are the real winners. Bakcell will continue providing its customers with high quality communication services at beneficial tariffs.’

Under local law, Azeri mobile operators pay each other a pre-agreed (i.e. fixed) interconnection tariff for off-net calls. In April 2009, the Ministry of Communications and Information Technologies (MCIT) set the new interconnection tariff for GSM operators at AZN0.02 per minute, and although Bakcell proposed that Azercell reduce its existing interconnection tariffs to the required level, its rival reportedly stated that it was ‘satisfied’ with previous tariff level of AZN0.05 per minute. Not surprisingly, Bakcell argued that the higher interconnection tariff acted as a bar to competition, limiting its ability to price its services more competitively for its customers.

According to TeleGeography’s GlobalComms Database, Bakcell had 2.765 million mobile subscribers at 30 September 2012, a market share of 29.9%. its mobile network currently covers more than 99% of the population and 92% of the geographical area of Azerbaijan (excluding occupied territories).

Azerbaijan, Azercell, Bakcell