Telcos get reprieve from fraudulent foreign calls


A woman makes a call on her mobile phone. PHOTO | CYRIL NDEGEYA | NMG

A tribunal has upheld the ban on secret international calls disguised as local conversations, sealing a loophole that was used by niche telecommunications service providers to avoid paying higher tariffs.

The Communications And Multimedia Appeals Tribunal ruled that the Communications Authority of Kenya (CA) was right in its 2018 decision to ban the practice technically known as SIM boxing.

Safaricom #ticker:SCOM reported the matter to the regulator in November 2016, accusing Geonet Communications Limited of illegally terminating international voice traffic on its network disguised as local calls to take advantage of domestic mobile termination rates, which are cheaper.

The CA, among other findings, declared that Geonet was guilty of SIM boxing which it said flouted the law.

Elige Communications, another player specialising in international calls, subsequently filed an appeal at the tribunal to challenge the regulator’s decisions.

The tribunal upheld the CA’s position in its judgement issued on February 11.

“The respondent’s (CA) finding that the second interested party (Geonet) was guilty of SIM boxing by reason of the absence of international numbers in its call detail records is upheld,” the tribunal said.

The regulator’s position that the geographical location of a caller or callee determines whether a call is local or international and the terminating rates thereof in the case of internet-based calls was, however, set aside.

“In our understanding, such a call can be made from any location from a software application with a local switching platform without any carrier, and therefore attracts a local termination rate,” the tribunal said.

Through SIM boxing, providers can terminate international calls disguised as local conversations by re-originating the foreign calls using local numbers. This allows them to avoid paying the higher call termination rates applicable to international voice services.

Safaricom had been sabotaging Geonet’s illegal operations before the regulator took over the matter.

The telco would terminate calls from Geonet’s customers at just under 30 minutes to curb revenue loss.

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