On December 27, 2013, the Vietnam Competition Authority (VCA) under the Ministry of Industry and Trade issued an official document on signs of competition law violations of three major mobile operators, namely VMS Company (MobiFone), Military Telecom Group (Viettel) and VinaPhone Company (VinaPhone). These three companies simultaneously have revised up 3G internet access service charges since October 16, 2013. VCA concluded that the three carriers did not “shake hands” to hike service tariffs and their price changes “followed policy orientations.”
No abnormality
According to the Ministry of Industry and Trade, in answer to public opinions, VCA collected and assessed information and documents to find out the truth. The corroboration results show that:
The price revision on October 16, 2013 by Viettel, MobiFone and VinaPhone followed the guidance and orientation for telecom charge adjustments specified in Decision No. 32/2012/QD-TTg dated July 27, 2012 of the Prime Minister on approval of the national telecommunications development plan till 2020 (Decision No. 32/2012/QD-TTg) and followed the compliance to laws on charges of telecommunications services required by State telecommunications management agencies. When they made changes to their service tariffs, these companies separately filed registration documents. The time of document filing and the time asked for new service tariff application in registration documents were different.
After the Vietnam Telecommunications Authority (VNTA) under the Ministry of Information and Communications approved 3G data rate adjustment plans of three companies on the same business day, that is October 4, 2013, and they issued decisions on new service rates at different times.
Price adjustment options (increased, decreased or unchanged) and data package supply options filed and applied by the three companies were also quite different.
The same day of new service tariff application, on October 16, 2013, was based on billing cycle and system technical operation which usually fell on the starting day of a month or mid-month. As the Vietnam Telecommunications Authority approved on October 4, 2013, the three companies chose to apply on October 16 to suit their billing cycles.
In reply to the same amounts of increase in some options, the Vietnam Telecommunications Authority said that service tariffs applied the same changes because they based on service tariff adjustment plans adopted by VNTA. Apart from common service options, they have many different options with various rates and technical features to meet the needs of their users.
Based on verification results and proofs, VCA did not find any signs of abnormal collusion or agreement among Viettel, MobiFone and VinaPhone in the latest service tariff changes applied on October 16, 2013.
Is there the market manipulation?
Regarding signs of abusing market dominance to impose unreasonable service prices that cause harm to customers, according to the Clause 2, Article 13 of the Law on Competition, the information substantiation results show that:
Based on information on market and market shares collected, according to the Point B, Clause 2, Article 11 of the Law on Competition, VCA defined that Viettel, MobiFone and VinaPhone held dominant positions on 3G data service market.
Regarding the act of abusing market dominance to impose unreasonable service prices that cause harm to customers, according to the Clause 2, Article 27 of the Governmental Decree No. 116/2005/ND-CP dated September 15, 2005 detailing the implementation of some articles of the Law on Competition (Decree 116/2005/ND-CP), VCA considered three factors used to determine signs and acts of imposing unreasonable goods and service prices to cause damage to customers. VCA found that:
With respect to tariff increase degrees, the aforementioned price adjustment was based on the guidelines and orientations on telecommunications price adjustments stipulated in the Prime Minister’s Decision No. 32/2012/QD-TTg and was approved by State telecommunications management agencies. As regarding price rate increase degrees, according to data from the Ministry of Information and Communications, the average increase in the mentioned price change was in the region of 20 percent, in excess of 5 percent allowed, as specified at Point A, Clause 2, Article 27 of the Government’s Decree 116/2005/ND-CP.
With regard to the abnormal change that leads to an increase in cost price of 3G data services, according to cost price reports submitted by Viettel, MobiFone and VinaPhone and confirmed by VNTA, the planned cost price in 2013 reduced in comparison with that in 2012. This confirmation showed that there was no abnormal change in 3G data service cost prices of the three carriers by more than 5 percent as specified at Point B, Clause 2, Article 27 of the Government’s Decree No. 116/2005/ND-CP.
With reference to supply-demand relation in the market, based on the report on 3G mobile information data service price changes submitted to the Prime Minister by the Ministry of Information and Communications appended the Official Document No. 3304/BTTTT-CVT dated November 6, 2013, the number of data subscribers served by the three companies reached 18.9 million as of September 2013 and the increased amount of data required also exceeded the supply capacity of the service providers.
VCA concluded that, given the above arguments, particularly the increase in subscribers in excess of supply capacity of the three companies, based on Clause 2, Article 27 of Decree 116/2005/ND-CP, there is not enough evidence to see the price adjustment as an act of imposing unreasonable service prices that cause harm to customers as provided by the Law on Competition.
Huong Giang
Đăng ký: VietNam News
