C. 02 -14 th
El Salvador, January 17 , 2014.
Platinum filed complaint against five telephone companies for blocking competition The Competition Superintendence (CS) began an investigation against five telephone companies after PLATINUM ENTERPRISES filed a complaint for having been denied interconnection for local and international calls termination in those operators´ networks. According to the complainant, the aforementioned situation impedes it to compete, under identical conditions, in rendering telephony services. The Salvadoran Telecommunications Law imparts a duty to deal on the part of telecommunication providers to confer access to an essential resource to any operator who requests said access1. “It´s the Superintendence´ duty to legally and economically analyze the case; listen to the defendants; and, decide pursuant to the Competition Law”, stated Francisco Diaz Rodriguez, Competition Superintendent.
The Competition Superintendence initiated, pursuant to the complaint filed by the company PLATINUM ENTERPRISES, S. A. de C. V., a formal investigation against five of its competitors for allegedly committing the anticompetitive practice set forth by Provision 30 letter a) of the Salvadoran Competition Law (CL), which prohibits actions constituting abuse of dominance by creating obstacles for the entry of competitors or for the expansion of the existing ones. The investigated operators are: TELEMÓVIL EL SALVADOR, S. A.; CTE TELECOM PERSONAL, S. A. de C. V.; CTE, S. A. de C. V.; TELEFÓNICA MÓVILES EL SALVADOR, S. A. de C. V.; and, DIGICEL, S. A. de C. V. In accordance to PLATINUM ENTERPRISES´s complaint, since 2010 the above cited providers have been denying it the interconnection for local and international calls termination in their networks, putting the plaintiff in a disadvantageous situation, making it impossible to compete, under identical conditions, in the provision of telephony services.
The complainant asserts that DIGICEL and TELEFONICA have not answered its multiple interconnection requests, while TELEMÓVIL, TELECOM, and CTE have excessively and unjustifiably delayed the negotiation processes, notwithstanding the mandate established by Provision 20 of the Telecommunications Law, which states: “Every operator of commercial telephony networks must confer access to essential resources to any operator who requests said access, by means of the corresponding payment and without any discrimination, under the obligation to offer interconnection unbundled charges, as well as access to the network´s unbundled elements…”.
Essential resource or facility: A network element used, owned, or controlled by an operator for rendering telephony services and which is simultaneously vital for the interconnection of another operator who wants to provide telecommunications services, without existing feasible alternatives to substitute said element. Telecommunications Law Regulations, Provision 4; Executive Decree n. 84, July 15 th, 2011; published in the Official Gazette n. 133, Volume n. 392, July 15th, 2011.
The Superintendence admitted the complaint and began the investigation against the five telephony operators th who have 30 calendar days, starting January 16 (a day after the resolution initiating the investigation was notified) to exercise their defense. If the alleged abuse of dominance is proven, the Superintendence could, amongst other actions: a) order the infringers to immediately cease committing the anticompetitive practice; b) impose remedies or obligations to the sanctioned economic agents; and, c) impose said economic agents the respective fines which may not exceed five thousand minimum monthly urban wages in the industrial sector. Case for interconnection blockage in the electric sector In 2007, the Superintendence ruled on a case where the company EDESAL filed complaints against the electricity distributors CAESS and AES CLESA for denying the complainant the interconnection in order to distribute electricity in the two suburban housing developments, thus, impeding the entry to this new competitor, and, hence, its expansion. The CS imposed each distributor a fine amounting US$17,040.00 for infringing the 2 Competition Law, Provision 30 letter a) , and ordered these economic agents to cease the anticompetitive practice. The sanctioned companies sued the Superintendence before the Administrative Contentious Tribunal. Said Tribunal decided in favor of the Superintendence ordering CAESS and AES CLESA to comply with the CS´ ruling: pay the fine and restrain from rejecting in the future interconnection requests of an operator in order to affect the market´s competition conditions.
Provision 30 of the Salvadoran Competition Law: “Any action that constitutes an abuse of dominant position by economic agents in a given market is forbidden, such as the following, amongst other cases: a) creation of obstacles to impede the entry of competitors or the expansion of existing competitors”.