Kcell Returns Money to Customers Resulting from Competition Law Violation

ASTANA – Kcell, one of Kazakhstan’s biggest cellular operators, received an order to return more than 1.5 billion tenge (US$8 million) to its customers as a result of violations of the competition law, according to an announcement by the country’s committee on regulation of natural monopolies and protection. Following consideration by the courts, including the Supreme Court of Kazakhstan, the decision was recognised as lawful and justified.

Photo credit: kapital.kz

Photo credit: kapital.kz

According to the Kcell press service, the money will be returned to clients due to the fact the operator did notstop the connection after the customer exhausted his funds, resulting indebt to the network provider.

“Despite the fact that the Supreme Court of Kazakhstan confirmed the right of the operator to stop or not stop the connection (radiotelephone conversation and the Internet) in the case of customers runningout of money, the claim of the antimonopoly authority has not been cancelled. In this connection, Kcell will begin to return money to customers for not disconnecting,” reported Tengrinews, citing the company’s representative.

“The investigation in respect to Kcell was launched on the basis of customers’ complaints and was completed in early 2014. The investigation by the antimonopoly authority found that the operator abused a dominant position (Article 13 of the law “On Competition”) and did not disconnect radiotelephone conversation or Internet access when the customer’s balance reached zero,” said in the committee’s official response.

Funds will be returned for the period from 2012 to September 2013. For the period from October 2013 until now, the company decided to return funds on a voluntary basis. The operator said customers will receive a text message or written notice, but the exact number is still unclear.

“As the refund will be made for actually-rendered services, Kcell JSC income tax liabilities will decrease in the amount of up to 1 billion tenge (US$5.33 million),” said the company.

Kcell has operated in the Kazakh market since 1998, providing mobile and Internet services. TeliaSonera, the Swedish-Finnish telecommunications holding, owns most of the company’s ordinary shares.

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