Trai may Re­ject CCI’s Turf Tres­pass Claim

The Economic Times - - Companies: Pursuit Of Profit - Gul­veen.Au­lakh @times­group.com

New Delhi: In­dia’s tele­com watch­dog will likely a cite le­gal prece­dent to re­ject the an­titrust body’s claim that the sec­tor con­troller had stepped on to the lat­ter’s turf by ex­am­in­ing as­pects of dom­i­nance and preda­tory pric­ing as part of a con­sul­ta­tion pa­per, fore­telling fur­ther fric­tion be­tween the Cen­tre’s two reg­u­la­tory arms. The Tele­com Reg­u­la­tory Au­thor­ity of In­dia (Trai) is likely to tell the Com­pe­ti­tion Com­mis­sion of In­dia (CCI) that preda­tory pric­ing and dom­i­nant po­si­tion are well within its reg­u­la­tory frame­work, some­thing the watch­dog had spec­i­fied while be­gin­ning the con­sul­ta­tion process on tar­iff as­sess­ment ear­lier this year, a se­nior of­fi­cial at the tele­com con­troller told ET.

The Trai re­sponse would fol­low CCI’s July 21 let­ter, which claimed that by ex­am­in­ing preda­tory pric­ing and dom­i­nance, the tele­com watch­dog had en­croached upon the ju­ris­dic­tion of the an­titrust com­mis­sion.

“We’ve been deal­ing with the is­sue of non-pre­da­tion much be­fore the CCI was con­sti­tuted and we’ve been talk­ing about ver­ti­cal price squeeze and sig­nif­i­cant mar­ket power. Th­ese are the eco­nomic prin­ci­ples be­ing fol­lowed for years to deal with com­pe­ti­tion in the sec­tor, and it is our do­main,” the se­nior of­fi­cial said.

Trai’s stance would be based on pre­vi­ous cases that in­volved the com­pe­ti­tion reg­u­la­tor and sec­tor watch­dogs, such as the Cen­tral Elec­tric­ity Reg­u­la­tory Com­mis­sion (CERC) and the Petroleum and Nat­u­ral Gas Reg­u­la­tory Board (PNGRB). Both judg­ments in th­ese cases went in favour of the sec­tor con­trollers.

“We will re­ply to them, say­ing that it is un­fair to state that the as­pects high­lighted fall only within the purview of CCI. It has a com­pli­men­tary role along with Trai, which is dis­charg­ing the role given to it as a sec­tor reg­u­la­tor… And, that we’re open for con­sul­ta­tion,” the of­fi­cial added. Although the an­titrust body had re­sponded to Trai’s con­sul­ta­tion ex­er­cise much later than the last stip­u­lated date for stake­holder re­sponses, the watch­dog is open to a meet­ing with CCI to dis­cuss the is­sues the com­pe­ti­tion reg­u­la­tor had raised. How­ever, this could end up de­lay­ing the rec­om­men­da­tions on the mat­ter by a cou­ple of months.

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