Companies
Airtel, ATC under Comesa watchdog probe over towers deal
Friday February 16 2024
Airtel Kenya headquarters in Nairobi. File | Nation Media Group
The Comesa watchdog has launched investigations into alleged anti-competitive conduct by telecommunication firms American Tower Corporation (ATC) and Airtel Africa.
The Common Market for Eastern and Southern Africa (Comesa) Competition Commission (CCC) said it has received a complaint that a recent deal between the two firms contravenes the trading bloc’s competition regulations.
“The Commission has commenced investigations into potential violation of Article 16 of the Regulations by American Tower Corporation and Airtel Africa operating in the Common Market,” said CCC chief executive officer Willard Mwemba.
Read: Pay TV firms under probe for World Cup outage in East Africa
Article 16 prohibits all agreements which may affect trade between member states and have as their object or effect the prevention, restriction or distortion of competition in the Common Market.
In the said agreement, Airtel and ATC entered a “strategic partnership”, which would see the latter develop new telecommunication sites for Airtel based on ATC’s green site specifications to cut Airtel’s carbon footprint.
ATC develops and leases telecommunication towers to mobile network providers. In Kenya, its local subsidiary ATC Kenya owns some 3,645 telecommunications towers.
Read: American tower firm takes Sh953m revenue hit on weak shilling
However, the complaint alleges that the deal is for “Airtel to take up a certain amount of ATC sites annually and in return, ATC provides Airtel with a financial rebate” which is seen as anti-competitive.
The agreement was announced in October 2022 and was touted as a move to increase connectivity in Africa and extend digital inclusion, while advancing both firms’ carbon emissions reduction objectives.
It would see all Airtel’s new connection sites in Kenya and Uganda (both Comesa members), and in Niger and Nigeria, developed by ATC.
Old sites would also be upgraded to the latest green site standards to cut emissions from the telco’s network towers.
Read: Airtel Africa to build data hub in Kenya after Nigeria project
“The Commission will thus assess the conduct of ATC and Airtel to determine its effect in the Common Market and apply appropriate measures as provided in the Regulations,” Dr Mwemba said.
Based on the Comesa competition regulations, should the two companies be found to have breached the competition requirements of the bloc, they would be asked to cease the agreement, pay a fine of an amount determined by the Commission, or both.
Airtel Africa has a presence in 15 African countries, seven of them — Kenya, Uganda, Rwanda, the Democratic Republic of Congo, Madagascar, Seychelles, and Zambia — being Comesa members.
ATC, on the other hand, currently operates in seven African countries, but only two – Kenya and Uganda – are Comesa members.
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