From Charles Webb.
AS the executive director of the Jersey Competition Regulatory Authority, I write in response to the letter by the chief executives of Sure, Airtel-Vodafone and Newtel which appeared in the 4 February edition of the JEP concerning the JCRA’s response to the recent increases in certain wholesale prices by Jersey Telecom.
As the telecommunications regulator for Jersey, we, too, are very concerned at the scale of some of the increases recently announced by JT. As an authority vested with responsibilities under Jersey law, however, it is crucial that our regulatory decisions are legally sound, based on robust evidence.
With these considerations in mind, in our 2009 aims and objectives we have committed to undertake major reviews of JT’s wholesale fixed-line product offering and separated accounts methodology.
As reported in the JEP on 21 January, this project will be a root-and-branch review of how JT conducts its wholesale business and may result in greater JCRA regulation in this area. We will be soon publishing more detailed project timelines for these reviews.
In addition, we have included in our 2009 aims and objectives consideration of whether JT should be required to publish its separated accounts, in addition to providing them to the JCRA, as called for by the other operators.
JT has decided to increase certain wholesale prices prior to our completion of these reviews and the JCRA currently has an insufficient basis for objecting to these increases. However, we have put JT and the other operators on notice that should our reviews conclude that JT’s price increases constitute one or more infringements of Jersey’s competition law, JT runs the risk that the JCRA’s infringement decision, and any associated penalties, would be based on the date JT introduced these prices.
In addition to the potential regulatory action we may undertake, the other operators have commercial means to challenge JT’s price increases. Under the terms of the agreements covering wholesale access, the parties may resort to arbitration to resolve commercial disputes, and as reported in the 22 January edition of the JEP, the other operators have expressed an intention to challenge JT’s recent price increases through this mechanism.
Finally, in their letter the chief executives emphasise the importance of a review of the role and powers of the JCRA and the telecommunications law. As called for at the conclusion of the States’ recent consideration of JT’s potential privatisation, the Economic Development department is currently undertaking a review of the JCRA’s powers, resources and functions as a telecommunications regulator. The JCRA has been supportive of, and fully co-operative in, this pending review.