CCP Moves to Approve PTCL-Telenor Merger

Staff Report

Islamabad: The Competition Commission of Pakistan (CCP) has started to move towards granting approval for PTCL-Telenor Merger following interventions of Special Investment Facilitation Council (SIFC).

The merger application by the PTCL has been pending for by almost a year as the PTCL management was not providing the relevant documents over several queries.

The letter forwarded by the CCP to the lawyer of the PTCL, Rahat Kaunan Hassan in the case has referred to the Section 11(11) of the Competition Act 2010, offering a new settlement option to the PTCL.

Sources in the PTCL informed that the option provided by the CCP includes investment of around $1 billion by the UAE based – telecom company e& (erstwhile Etisalat) that has the management control of the PTCL.Starlink to Start Internet Services in Pakistan by Nov

Sources added that the CCP has sought timeline and details about the areas of investment to be made by PTCL.

The letter forwarded by the CCP has referred to the clause 11 of section 11 states that in case the Commission determines that the merger transaction under review does not qualify the specified criteria the Commission may prohibit the consummation of the transaction.

The law further states that the CCP can approve such transaction subject to the conditions laid by the Commission in its order and also approve such transaction on the condition that the said undertakings enter into legally enforceable agreements specified by the Commission in its order. 

Sources in the ministry if IT and telecom added that the decision over the merger application by the PTCL has been pending for by almost a year as the PTCL management was not providing the relevant documents over several queries.

The senior official of IT ministry said that at the same the issue of pending payment of $800 million also remains unresolved, while the settlement was reached between the previous government and the PTCL management at $640 mn but the PTCL has not even paid that amount.

The new option of investment amounting to $1 bn has been reached after intervention of the SIFC, as the PTCL management had approached the Council. 

Meanwhile, the PTCL was also facing notices by the telecom regulator Pakistan Telecommunication Authority (PTA) for being Significant Market Player in several sections of the telecom industry.

During the second phase review of the merger application the Commission sought details related to the market position of the PTCL from the PTA to determine that the intended merger does not lessens competition or strengthen the dominant position of the parties concerned.

The documents submitted by the PTA to the CCP showed that instead of addressing the objections by telecom regulator, the PTCL management had challenged the notices in Sindh High Court.

However, responding to the query by CCP that the PTCL was already enjoying a dominating position in the telecom sector.

The PTCL had submitted the application for the merger of Telenor Pakistan with the CCP on 29th February, 2024, but there were flaws in the application that was corrected on 6th March, 2024