Prohibited deals: CAT dismisses appeals filed by DHA Lahore, Wateen

ISLAMABAD: In a significant ruling, the Competition Appellate Tribunal has dismissed the appeals filed by Defence Housing Authority (DHA), Lahore, and Wateen Telecom (Pvt) Limited, upholding the Competition Commission of Pakistan’s decision to impose substantial penalties for engaging in prohibited agreements that restricted consumer choice.

The Competition Appellate Tribunal has maintained the penalties levied by the CCP on DHA Lahore and Wateen Telecom. DHA Lahore was fined Rs 10 million and Wateen Telecom Rs 5 million for entering into an exclusive arrangement of limiting the provision of telecommunication and media services within DHA Lahore to Wateen Telecom alone.

The proceedings were initiated following numerous complaints from DHA Lahore residents about the lack of choice in service providers other than Wateen Telecom and the unsatisfactory quality of services offered. Investigations by the CCP revealed an exclusive arrangement between DHA Lahore and Wateen Telecom, granting the latter sole rights to provide telecommunication and media services in certain phases of DHA.

The exclusive agreement between DHA Lahore and Wateen Telecom was found to be in contravention of Section 4 of the Competition Act, 2010. Consequently, the CCP, vide its order dated 22 March 2011, imposed penalties of Rs 10 million on DHA and PKR 5 million on Wateen. The provisions of the agreement granting Wateen exclusive rights, including the right of way and soil digging permissions, were declared void and without legal effect. Both DHA Lahore and Wateen Telecom appealed the CCP’s decision before the Competition Appellate Tribunal, Islamabad. After extensive hearings, the Tribunal dismissed both appeals, affirming the CCP’s findings and penalties.

Copyright Business Recorder, 2024