PCC finds basis to open probe on Dito complaint vs Globe, Smart

THE Philippine Competition Commission (PCC) has found reasonable grounds to open a preliminary investigation into the complaints filed by Dito Telecommunity against Globe Telecom and Smart Communications.

In a news statement issued on Friday, the country’s competition watchdog said, “The PCC Enforcement Office (CEO) will look into the allegations in the complaints for possible violations of Section 15 of the Philippine Competition Act (PCA) pertaining to abuse of dominance.”

PCC said its enforcement arm would also study whether other violations of the PCA pertaining to anti-competitive agreements have been committed.

As it proceeds with the investigation, the competition watchdog will coordinate and consult with the National Telecommunications Commission (NTC) and other relevant authorities for regulatory and technical considerations.

Without prejudging the outcome of the enforcement office’s investigation, the PCC reminded players with substantial market power, not only in the telecommunications industry but across sectors of their responsibility to compete fairly and to adhere to the principles of competition.

“The PCC takes complaints of anti-competitive behavior very seriously,” PCC said in the statement.

The BusinessMirror earlier reported that Dito Telecommunity Corp. has sued both Smart Communications Inc. and Globe Telecom Inc. for allegedly abusing their dominant positions by imposing commercial demands for interconnection.

The third telco filed the cases before the Philippine Competition Commission (PCC) on August 8, according to Dito Chief Administrative Officer Adel Tamano.

Tamano said the cases stemmed from the limited capacity that both Smart and Globe provided Dito for interconnectivity. Interconnectivity allows subscribers to call from one operator to another.

Tamano said Dito subscribers are finding it hard to call Smart and Globe subscribers because the interconnectivity capacity was not enough.

The quality of interconnectivity is measured by the so-called grade of service, a metric set by the National Telecommunications Commission (NTC).

Dito sued both Smart and Globe for allegedly violating Section 15b and 15c of the Philippine Competition Act or Republic Act No. 10667.

Both provisions pertain to the abuse of dominant positions by imposing barriers to entry or committing acts that prevent competitors from growing in the market and making a transaction subject to acceptance by the other parties even without connection with the transaction.

In a statement, PCC Officer-in-Charge Johannes Bernabe said Interconnection is an essential component of the telecommunications industry as it allows interoperability and exchange of calls, SMS, and other information from one network to another.

Dito is seeking compensatory damages, as the lack of interconnection has resulted in losses—both in subscribers and revenues—for Dito.

Meanwhile, Globe Telecom Inc., in a separate statement a day after Dito sued Globe and Smart Communications Inc., said an average of 1,000 fraudulent calls—identified as international in origin but masked as local calls—are allowed to pass through Dito’s network to Globe users every day in violation of interconnection rules.  

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