Regulatory chief reconsiders fine on TPSA for anticompetitive behavior

Witold Graboś, the new president of the Office of Telecommunications and Postal Regulation (URTiP), may drop a stiff fine levied on Telekomunikacja Polska (TPSA) last month for anticompetitive behavior, Graboś told the WBJ last week. The former vice chairman of the National Radio and Television Council (KRRiT), who earlier this month was appointed head of the newly combined agency for telecom and postal regulation, said he was ready to reverse the zł. 350 million ($85 million) fine issued by his predecessor if TPSA "consents to the (URTiP's) decisions and withdraws all cases from court." Kazimierz Ferenc, the former president of the telecom regulatory office, slapped two fines on TPSA in late March - one for zł. 300 million for not executing an agreement with alternative domestic long-distance (DLD) operator Niezależny Operator Miźdzystrefowy (NOM) and a second for zł. 50 million for publishing false data about its revenue from rental lines. TPSA called the decisions unjustified and has appealed them.

"The fine should not be a target in itself (but they) should serve as important market solutions and support the development of the (telecoms) market," Graboś said. "Today this market is very paralyzed because of a simple reason: On one hand, TPSA is using every pretext not to consent to the decisions of the office, on the other, the office is trying to abuse TPSA. This is not proper because it leads to paralysis of the market." Graboś called the fines "a bit too high" and said TPSA recently showed signs of acquiescence when its president, Marek Józefiak, did not object to the regulator's statement that it hoped TPSA would acknowledge its dominant position on the market. The comment was made during the signing of an agreement between TPSA and NOM regarding billing procedures for the alternative DLD operator's clients. Witold Rataj, TPSA's spokesman, said he was surprised that Graboś may reverse the fines, adding that the company's management had not yet received any proposals from the regulator. "Such a proposal would be of extreme interest for us," Rataj said. "If we receive such an offer, we will analyze it with the utmost scrutiny." Graboś added that he was not in favor of fines as punishments for anticompetitive behavior but had to consider them because the telecommunications law required it. He added that establishing "civilized conditions of cooperation in the market" was one of his main tasks as regulator.

"I will never be a Robin Hood of the Polish telecommunications market and will never take from the rich and give to the poor," Graboś said. "I only want to reasonably modify the market according to state policy. In the long term I am concerned about the development of telecommunication services and infrastructure. The target is to create more and cheaper services." Graboś also said he was critical of the agreement between TPSA and NOM, which forced the alternative operator to stop offering call-by-call DLD services and to sign individual contracts with its clients. He blamed the outcome of the row between TPSA and NOM on ill-prepared and inconsistent regulations in the telecoms law.

Regarding international long-distance (ILD) calls, Graboś said he did not intend to issue a ruling that would declare ILD calls via voice-over-Internet protocol (VoIP) - a means of sending voice communication in digital packets over data transmission lines rather than through traditional telephone networks - as a voice service. Several industry watchers predicted that the regulator would soon declare the service to be a form of voice communication instead of data transmission, thereby prohibiting existing VoIP ILD providers from continuing to offer their services via Internet wires. Under the telecom law, TPSA has a monopoly on ILD services until Jan. 1, 2003, when the telecom market is fully liberalized. "I have no such competence derived from the law," Graboś said, referring to issuing a decision on the definition of VoIP service. "I can see no reasons for regulating that but this is still ahead of us." He added that although he had no such intentions, he planned to consult with experts on the matter.