South Africa fines Telkom $54.8 million for unfair practices

A government tribunal fined South Africa’s Telkom SA Ltd. US$54.8 million Tuesday over a decade-long case alleging the company used its monopoly to put unfair prices on its competitors.

The decision by the Competition Tribunal of South Africa found Telkom charged its competitors high prices for using its Internet services, while charging much lower fees to its subsidiaries and its customers. The tribunal looked at Telkom’s business practices from 1999 to 2004 in making its decision.

“Telkom’s conduct caused harm to both competitors and consumers alike and impeded competition and innovation,” the tribunal’s decision read.

A spokesman for Telkom said the company had no immediate comment about the ruling.

Regulators had sought a fine of as much as US$390 million for Telkom’s practices. While describing Telkom’s practices as “bullying,” the commission held back on a fine that could have crippled the struggling telecommunications company.

The case began in 2002, with Internet service providers alleging Telkom charged them excessive fees for accessing its bandwidth.

The South African government still owns part of Telkom SA Ltd., once an entirely state-run company. The company, with operations in other African nations, has had financial troubles in recent years. Subscribers also have increasingly dropped fixed telephone lines, the backbone of Telkom’s business, for mobile phones.

Copyright 2012 The Associated Press