𝐂𝐈𝐈 Committee Questions Communications Authority Over Review of Mobile Termination Rates

The Departmental Committee on Communication, Information and innovation today convened a meeting with the Acting Director General of the Communications Authority of Kenya (CA) to discuss the issues surrounding the review of Mobile Termination Rates (MTRs).

Appearing before the Committee chaired by Hon. John Kiarie (Dagoretti South), the Acting DG Christopher Wambua addressed the Legislators’ concerns among them: the potential impact of the review of the Mobile Termination Rate (MTR), implications of the review on limitation of access by Kenyans to telecommunication and Government services offered on e-citizen services, as well as if there was public participation in the review of the MTRs.

“The reduction of tariffs and costs mean more benefits to the consumer, and in turn, the telecommunication service providers. We know that there are teleco companies expatriating profits, and we need to ask ourselves who stands to benefit from this review.” Argued the Chairperson.

Hon Kiarie and the Committee members urged the Authority to consider the interest of Kenyans, even as they seek to review the rates. They proposed that the review should greatly take into consideration the current context, questioning the motivation behind the review.

In his submissions, the Acting DG told the Committee that the competition concern with termination rates is that each operator has a monopoly over termination of calls on its own network, and therefore it can be used by incumbent players as a barrier to exclude rivals (since they have large networks).

According to him, from the foregoing analysis, the proposed reduction in MTR is likely to have similar positive impact on the various market indicators. Given the projected increase in voice traffic, CA anticipates an increase in operator revenues. As a result, an increase in Government tax revenues will be realized.

The Director told the MPs that the Authority last year conducted a study on National Roaming, Telecommunications Tower Sharing and Termination Rates Network Cost Study in Kenya. The overall objective of the study was to develop a regulated pricing and access framework applicable to all licensees seeking capacity and/or access (towers, national roaming and interconnection), in uncompetitive markets.

The outcome of this study will be implemented with effect from 18th November 2023 after the expiry of the prevailing rates.

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