Egyptian Competition Authority reports violation against Egyptian telecommunication company for abuse of dominant position

On March 9, 2024, the Egyptian Competition Authority (ECA) announced that it registered a violation against one of Egypt’s telecommunications companies for abusing its dominant position and forcing its customers to contract “fixed internet” service in exchange for obtaining “landline phone” service. This action is in breach of the Law on Protecting Competition and Preventing Monopolistic Practices No. 3 of 2005 (of the Egyptian Competition Law). This violation came as a result of numerous complaints and reports from citizens across Egypt’s governorates citing the refusal of customer service employees at sales outlets to provide landline phones without fixed internet. In case of refusal by the customers, the delivery of services by the company is delayed which ultimately forces the customers to accept both services. The credibility and authenticity of said reports has been proved by the ECA, which has accordingly obliged the said company to suspend any acts which lead to linking fixed internet services to landline telephone services.

It is worth noting that the Egyptian Competition Law prohibits any company who has control over a relevant market from conditioning the conclusion of a contract or agreement for a product on the condition of accepting obligations or products that, by their nature or by virtue of their commercial use, are not related to the product that is the subject of the original agreement, contract, or transaction. The said telecommunication company violation arises out of this law. Noting this, a person is deemed to have control over a market subject to satisfying certain conditions as set out under the Egyptian Competition Law, for having a market share of more that twenty- five percent (25%) and has an effective impact on prices or the volume of supply therein without being restricted by its competitors. The ECA is required by virtue of the Egyptian Competition Law to burden the violator to amend and remove the violation or take corrective measures immediately or within a period determined by the ECA, otherwise, the violating agreement or contract shall be deemed invalid. The ECA’s board of directors may, by a majority of its members, issue a decision to stop practices that appear from the apparent evidence under its control to violate the Egyptian Competition Law, abuse of dominant position, for a specific period of time if these practices result in serious irreversible harm to competition or the consumer, without prejudice to any liability arising out of said violation, which includes financial penalties incurred by the violator.