CCP Orders PTCL to Separate Operations After Telenor Merger Approval

The Competition Commission of Pakistan (CCP) has directed Pakistan Telecommunication Company Limited (PTCL) to separate its operations after approving its merger with Telenor Pakistan. The move aims to stop anti-competitive practices and ensure transparency in the telecom sector after the merger.

According to the detailed order published on the CCP website, the CCP has placed strict conditions on PTCL. These include separating the new merged company, which will combine Ufone and Telenor Pakistan under the name “MergeCo,” from PTCL and all its other businesses. PTCL has formally agreed to follow these conditions.

CCP Orders PTCL to Separate Operations After Telenor Merger Approval

Once the merger is complete, MergeCo will become the second-largest cellular mobile operator in Pakistan, just behind Jazz and ahead of Zong. At present, Ufone is the only loss-making operator among the four main telecom companies. The CCP has required the merged company to show profitability, with an independent evaluator submitting performance reports every six months.

To ensure operational independence, the CCP has ordered PTCL and MergeCo to keep separate financial accounts for every service they offer. They must also operate with separate boards of directors and management teams. Currently, some individuals serve in both PTCL and Ufone, including the CEO, which the CCP says must change.

The order clearly states, “No individual may simultaneously serve on the board or hold senior management roles in both PTCL and MergeCo.” It also adds that any former executive or board member cannot join the other company for at least three years after leaving their position.

See Also: PTCL–Telenor Deal Moves Forward: PTA to Rule Within Six Weeks

Senator Palwasha Khan, Chairperson of the Senate Standing Committee on IT and Telecom, praised the CCP’s ruling. “PTCL is a state-owned company, so it is our responsibility to protect public interest,” she said. “The committee will ask for quarterly reports from MergeCo to make sure it remains profitable.”

The order further restricts the sharing of commercially sensitive information between PTCL and MergeCo. Any changes in interconnection circuits provided to other telecom operators, such as long-distance international or local loop connections, must be approved by the Pakistan Telecommunication Authority (PTA) beforehand. Interconnection pricing or capacity cannot be used to restrict other operators’ access to MergeCo customers.

A senior CCP official warned that failure to comply with these conditions could lead to strong action. This could include forcing PTCL to sell parts of its telecom infrastructure or business operations, as allowed under Clause 13.19 of the order.

Experts believe this separation will bring more transparency to the telecom industry. It will also help reduce unfair cross-subsidisation and promote fair competition, allowing consumers to benefit from improved services and better pricing.