Regulator says can’t compel telcos into deal with US-based GeoNet

The Communications Authority of Kenya (CA) says it does not have the mandate to compel any parties to enter into a contractual agreement with GeoNet, a US-based firm offering international call services.

Through lawyer Wambua Kilonzo, the regulator told High Court Judge George Odunga that there was no statutory provision that allows it to compel mobile network operators to interconnect with any international gateway service (IGS) provider at a particular fee.

“The September 21 decision by the authority to compel the parties to conclude the interconnection agreements in four weeks was an acknowledgement that interconnectivity is an obligation under the law but it was for the parties to agree on other commercial aspects,” he said.

GeoNet’s local subsidiary had filed a case against the regulator for failing to intervene in the partnerships with local mobile phone operators that would see people in the diaspora easily make calls terminating on the local networks.

The firm, which operates several licences, including as an IGS provider, says it has paid the CA more than Sh32 million in IGS fees alone but has not been able to use the licence because of the stalemate.

Mobile network operators Safaricom, Airtel and Telkom Kenya are listed in the suit as interested parties to the case and GeoNet wants the court to issue orders to the regulator compelling the trio to enter into interconnection agreements with the multinational.

READ: CA seeks 14 days to respond to suit by US-based telco

In its written submissions, the regulator argues that the service GeoNet will be providing will have calls originate or terminate from the diaspora and there is no law that grants it power to determine or set the applicable termination rates for international traffic.

The CA argues that the granted licence conditions require the holder to construct, install and operate an international electronic communications system which Geonet did not have.

The firm claimed that the interconnecting rates charged by the three telcos was above the normal agreed rates and would restrict Kenyans from enjoying competitive international call rates.

Airtel wanted to be paid at the rate of Sh20 per minute while Safaricom and Telkom Kenya’s Orange want to charge Sh10 per minute for international voice traffic terminating on their networks, instead of Sh0.90 stipulated in the regulations, according to GeoNet.

Mr Kilonzo, however, told the court that the mobile termination rates and the fixed termination rates that Geonet are referring to were determined after CA conducted a network cost study in 2010 that considered the market structure and used network and financial specific information relevant to local traffic origination and terminating from and into networks of mobile operators.