Bermudan regulator issues emergency order on North Rock-Logic merger

1 May 2013

Bermuda’s new telecoms industry Regulatory Authority (RA) has issued an emergency decree concerning the proposed merger of domestic internet service providers (ISPs) North Rock Communications and Logic Communications, amid worries the move ‘raises potentially serious competition concerns’.

As reported by TeleGeography’s CommsUpdate earlier this week, Logic Communications and North Rock Communications said they planned to merge and trade under the Logic Communications name, although both firms will retain their individual brands for the short-term. The new enlarged company will be 100% owned by KeyTech Limited – which already owns Logic Communications – and the tie-up comes at a time when the RA is looking to level the playing field by replacing segmented licensing with a unified single licence, the Integrated Communications Operating Licence (ICOL), allowing service providers to offer a full suite of integrated telecoms products pursuant to the new regulatory framework established by the Electronic Communications Act, including internet, local and long-distance phone services and mobile.

The Royal Gazette writes though, that although the emergency order does not stop the merger taking place, it does place a ‘temporary stop’ on ICOLs being issued to the enlarged entity to allow the RA time to review that internet market again, in light of the new development. Furthermore, the paper goes on to say that the government intends to hold a news conference on the matter in the wake of the issuance of 19 ICOLs to domestic operators yesterday. The CEO of the independent regulator, Philip Micallef, is quoted as saying that North Rock has been informed that it must ‘continue giving services as they were doing prior to ICOLs’ being issued. ‘The ICOL for North Rock cannot be issued as North Rock no longer exists as a legal entity,’ he said. ‘We would then need to transfer North Rock’s ICOL and associated spectrum licences to Logic’. He went on to say however, that this process is not expected to take long.

Bermuda, North Rock Communications