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The Office of the Telecommunications Authority (OFTA) today (August 10) issued the following press statement in response to the publication of a new Unified Interconnection and Local Access Service (UILAS) tariff by PCCW-HKT Telephone Limited (PCCW) in the Government of Hong Kong Special Administrative Region Gazette No.32 Vol.11:
"In filing the tariff with the Telecommunications Authority (TA), PCCW has indicated that the existing Fixed-Mobile Interconnection Charge (FMIC), Local Access Charge (LAC) as well as existing agreements between PCCW and other fixed telecommunications operators in relation to the Fixed-Fixed Interconnection Charge (FFIC), will remain in full force and effect without any change whatsoever. Furthermore, PCCW has indicated that Mobile Network Operators, Fixed Network Operators, External Telecommunications Service Operators and other licensees may continue to enjoy the current interconnection services from PCCW pursuant to those tariffs and agreements.
Since the existing interconnection/access arrangements and the associated tariffs remain effective and unchanged notwithstanding the publication of the new UILAS tariff, there is no amendment to an existing tariff requiring the TA's approval under PCCW's licence. The new tariff will take effect on August 15, 2007.
The TA will monitor closely the market response after the publication of the new tariff, including the progress of commercial negotiations that will be held between PCCW and other licensees, and the impact that the tariff may have on the market.
Licensees should seek independent legal advice to ensure that their negotiations in relation to the UILAS tariff comply with the relevant provisions in the Telecommunications Ordinance. As the regulator of the industry, the TA will continue to strive for the maintenance of effective market competition and protection of public and consumer interests. If necessary and depending on the response of the industry, the TA may issue a statement to set out her position on any area of concern that the industry may have in relation to the UILAS tariff and its status with existing relevant tariffs and TA determinations."
Background
On July 24, 2007, PCCW filed with OFTA its UILAS tariff pursuant to Special Conditions (SCs) 2 and 7 of its Fixed Carrier (FC) Licence. The UILAS tariff is a set of bundled tariff covering the interconnection charges for all types of call, including FMIC, LAC and FFIC. It is a new set of terms and conditions which PCCW intends to offer for commercial negotiation with other carriers and service providers for interconnection with and/or access to the network of PCCW.
SC2 of PCCW's FC Licence states that, among other things, the licensee shall provide the service on its published terms and conditions and at the tariff published in accordance with SC7. SC7 states, among other things, that the licensee shall publish and charge no more than the tariffs for the service operated under the licence. Publication of a tariff shall be effected by publication in the Hong Kong Government Gazette.
PCCW obtained its new FC licence in January 2005. Under this FC licence, PCCW does not have to seek prior approval from the TA on new tariffs which come in force after December 1, 2004, including moves to offer discounts and other benefits in response to price competition. All potential anti-competitive conduct, particularly in relation to bundling and price discrimination, will be investigated and regulated under the competition provisions in the Telecommunications Ordinance (the Ordinance).
In order to maintain status quo for the interconnection arrangements in place before the issue of the new FC licence to PCCW, certain ex ante regulations on the existing interconnection tariffs of PCCW have been retained and all amendments to the pre-existent interconnection tariffs of PCCW in force at December 1, 2004 require the prior approval of the TA in addition to being subject to ex post regulation under the competition provisions in the Ordinance.
PCCW has confirmed with OFTA that in publishing the UILAS tariff, it is simply introducing into the market an additional new interconnection service option. Having noted the representations made by PCCW, the TA considers that the UILAS tariff does not fall under SC 3.4 of PCCW's FC Licence and it therefore does not require her prior approval before publication.
Ends/Friday, August 10, 2007
Issued at HKT 16:55
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