Telkom announced on Wednesday that it had approached the Competition Tribunal to declare the suite of spectrum arrangements between Vodacom and Rain as a merger that should have been notifiable under the terms of the Competition Act.
“Telkom contends that the merger is notifiable because the multiple agreements between Vodacom and Rain grant Vodacom use and control over the deployment of Rain’s spectrum, including the planning, rollout, maintenance and service of its radio access network,” the company said in a statement.
Rain works with Vodacom to share infrastructure, while Vodacom assists it in putting up telecommunications towers and equipment.
According to Telkom’s Group Executive for Regulatory Affairs and Government Relations, Dr. Siyabonga Mahlangu, Vodacom’s ability to control Rain’s spectrum entrenches its position as a dominant player in a highly concentrated market.
“It is important that the effects of spectrum arrangements on competition are scrutinised,” says Mahlangu. “Particularly, in light of the upcoming spectrum auction which will set the ground for the nature of competition in the mobile market for the foreseeable future” he continues.
Telkom is asking the Competition Tribunal to find that the arrangements constitute a notifiable merger and should be subjected to scrutiny by the competition authorities.