Reliance Jio sparks a face off between Trai, CCI
New Delhi/Mumbai: Richest Indian Mukesh Ambani’s telecom debut now has the nation’s regulators facing off in the Supreme Court.
A plea by India’s telecom regulator to the apex court, claiming it has “exclusive jurisdiction” on the sector, has pitched it against the nation’s antitrust agency, escalating the turf war in a sector grappling with uncertainty since Ambani launched Reliance Jio Infocomm Ltd. with free offerings in 2016.
The Telecom Regulatory Authority of India (Trai) filed the application before the country’s top court to oppose attempts by the Competition Commission of India (CCI) to investigate allegations by Reliance Jio against its three largest rivals. The apex court said it will start hearing the case on Tuesday.
The quarrelling regulators risk worsening the disruption in India’s telecom sector, where Jio has stoked a price war since its entry, hurting profits at even the biggest operators while smaller ones have chosen to exit or merge. In the midst of this, Ambani’s telecom unit has emerged as India’s fourth-largest carrier and reported its first-ever quarterly profit within 16 months of starting operations.
Rivals have complained of predatory pricing. Jio, in turn, has accused three incumbent operators — Bharti Airtel Ltd., Vodafone India and Idea Cellular Ltd. — of anti-competitive behaviour aimed at blocking its entry and hindering its services. The fight is so intense that Kotak Securities Ltd. stopped coverage on Bharti last month saying it can’t value the company anymore as it’s not sure how far Jio will go to establish its dominant position.
The Competition Commission moved the Supreme Court in December claiming it has the right to investigate Jio’s allegations. Its probe was last year halted by a lower court.
Any dispute pertaining to anti-competitive practice or abuse of a dominant position in the market fell within its “exclusive domain,” the antitrust regulator said in its petition to the top court, “regardless of the existence of a sectoral regulator.” Bloomberg
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