• Telkom asked the Competition Tribunal to declare the spectrum arrangements between Vodacom and Rain as a merger.
  • It wants the competition authorities to scrutinise their relationship.
  • But Vodacom and Rain say that the authorities have already studied and approved their agreements.
  • For more articles, go to www.businessinsider.co.za.

Vodacom is fighting back against Telkom’s accusation that it has effectively merged with another competitor, Rain.

On Wednesday, Telkom asked the Competition Tribunal to declare the spectrum arrangements between Vodacom and Rain a “merger”.

Telkom says 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”. It believes this constitutes a merger, and should be subjected to scrutiny by the competition authorities.

But a spokesperson of Vodacom said that back in 2018, both the Competition Commission and the Independent Communications Authority of South Africa (Icasa) investigated the agreements between Vodacom and Rain.

“The Competition Commission found that the 2018 agreements do not constitute a merger in terms of the Competition Act. Icasa found that the 2018 agreements are not in breach of the Electronic Communications Act.”

The spokesperson said that Icasa is on record stating that the agreements helped Rain to expand as a “wholesale and retail competitor in mobile broadband, which Icasa deemed to be pro-competitive”.

“Vodacom remains confident that the agreements between Vodacom and Rain do not constitute a notifiable merger and do not contravene the Competition Act.”

Rain's chief marketing officer Khaya Dlanga also said that the company's provision of non-exclusive roaming services to Vodacom has previously been scrutinised and approved by the Competition Commission and Icasa. 

"Rain also competes fiercely in the retail 4G and 5G data markets in South Africa with innovative and affordable unlimited products.

While details of the agreements between the two companies are not public, competitors have complained bitterly about the deal between Vodacom and Rain, which reportedly includes the smaller operator getting access to Vodacom tower sites to build out its network infrastructure, while Vodacom gets to piggy-back on the valuable radio frequency spectrum assigned to Rain.

In one hearing Cell C said it estimated that access to Rain's spectrum would gain Vodacom a benefit of R11.5 billion by this year.

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