Floor price issue: Leave to proceed refused

Wasantha RAMANAYAKE

The Supreme Court yesterday refused to grant Leave to Proceed with three Rights applications filed by Bharati Airtel Lanka (Pvt.) Ltd. and two mobile phone consumers against the Telecommunication Regulatory Commission's decision to fix a minimum 'floor price' for outgoing mobile calls.

The Bench comprised Chief Justice Asoka de Silva, Justice Saleem Marsoof PC and Justice P.A. Rathnayake PC.

President's Counsel D.S. Wijesinghe for the Telecommunication Regulatory Commission (TRC) submitted that the 'floor price' has been there since 2009 and the petitioners could not now challenge it; "it is now out of time," for the operators to canvas the floor price, he submitted. He submitted that all operators were bound by the floor price and the present decision of the TRC. The petitioners are now challenging clearly a 'revision,' of the floor price.

He submitted that the price war among the operators were so high that only the government should intervene to safeguard the future of the industry.

Deputy Solicitor General (DSG) Shavendra Fernando took up a preliminary objection that the petitioners could not maintain the applications since they have failed to make the subject minister, in this instance, the President, as a necessary party to the application. He submitted that the TRC has arrived at the decision with the consultation with the minister. The DSG argued that the failure to make the minister a party to the applications is 'fatal' and therefore should be rejected in limine.

President's Counsel Nihal Jayamanne appearing for intervening petitioners Sri Lanka Telecom and Mobitel Pvt Limited submitted that the TRC addressed the communication containing its decision of the floor price to all mobile operators and therefore the petitioners should make all the mobile operators parties to these applications. He argued that since the petitioners failed to make parties, the applications should be rejected.

The President's Counsel also argued that the TRC could not falter in the national interest to secure the future of the mobile telephone industry amidst the price war of the operators.

Counsel Sanjeewa Jayawardane appearing for intervening petitioner the Dialog submitted that the decision was a government fiscal policy decision which cannot be challenged by way of a rights application.

President's Counsel Romesh de Silva appearing for one of the petitioners, Bharati Airtel submitted that the TRC's decision was both ultra vires of the TRC Act and was in violation of the rights of the petitioner.

He submitted that TRC failed to consider the view of his client that the floor price could only be implemented at the cost of the consumers and the operators. He also submitted that the floor price barred the new operators such as his client gaining the market share although they could offer a good service. He also submitted that the consumers too deprived of enjoining competitive prices driven by the competition. President's Counsel Shibly Aziz and Manohara de Silva also made submissions on behalf of two petitioners who are consumers affected by the floor price.

Counsel Avindra Rodrigo for Eti Salat and Suntel also made submissions.

Petitioner company Bharati Airtel Limited sought a court direction that there will be no floor price imposed on the tariff implemented on the mobile operators and set aside the two letters issued by the TRC containing the decision. The petitioner company cited the TRC, its Director General Anusha Pelpita and the Attorney General as respondents.

It stated that it had made an investment around Rs. 20.2 billion when it began its commercial operations in January 2009. It stated that in order to attract new subscribers it has to offer attractive packages in addition to a better service. New operators such as the petitioner company could not do so when there is a floor price. It added that the new floor pricing does not affect the market leaders since they have stabilized.

It stated that in terms of the the new floor prices of the TRC, a minimum charge of Rs. 2 per minute off-net and one rupee per minute on-net or within the same operator would be applicable where the tariff is on a per minute basis. These amounts would be Rs. 2.50 a minute on the off- net and Rs. 1.25 on-net per minute on per second billing basis.

It alleged that the TRC has rejected packages below the floor price for the petitioner while it had earlier allowed similar tariff plans of other operators in violation petitioner's rights.

Two petitioners, who are consumers, stated that introducing a floor charge is of a national importance and the publics should be heard before introducing any minimum charge, where they could express their views on the matter.