ISLAMABAD: The long-delayed merger of Telenor Pakistan with Ufone has hit a wall as the Competition Commission of Pakistan (CCP) openly accused Pakistan Telecommunication Company Limited (PTCL) of blocking scrutiny, withholding data, and abusing its market power.
Regulators went so far as to call PTCL’s conduct a pattern of “defiance and dominance,” saying the company has a history of collusion, regulatory defiance, and abuse of its dominant position. The CCP told the Senate Standing Committee on IT & Telecom that PTCL has repeatedly dragged its feet, failed to submit a clear investment plan, and deliberately withheld critical documents needed to assess the deal.
The Commission pointed out that PTCL often resorts to stay orders against the Pakistan Telecommunication Authority (PTA) in courts to escape oversight, a tactic that undermines regulatory authority. It further warned that PTCL’s dual role—with an LDI (long-distance international) license and management control of Ufone’s CMO (cellular mobile operator) license—creates serious risks of cross-subsidisation that could tilt the telecom market in its favor.
Even after a year since the first open hearing in September 2024, PTCL has not provided complete documentation. On August 26, 2025, it submitted agreements with Jazz, Zong, and Telenor—but intentionally withheld its agreement with Ufone, the very heart of the merger under review. The CCP described the company’s responses as incomplete, overly technical, and deliberately misleading.
The regulator also reminded lawmakers of PTCL’s past misconduct, including its leading role in the anti-competitive International Clearing House (ICH) cartel, which resulted in penalties upheld by the Competition Appellate Tribunal and more than Rs 70 million in recoveries.
Beyond transparency, the CCP questioned PTCL’s ability to manage Ufone at all, citing the operator’s consistent losses under PTCL’s control. Instead of creating efficiencies, the merger, regulators warned, risks entrenching PTCL’s dominance, raising barriers to entry, and shrinking consumer choice.
While acknowledging that mergers can encourage growth and innovation, the CCP cautioned that this deal could result in a “Substantial Lessening of Competition (SLC).” The Commission said it is considering three options: outright rejection, conditional approval with strict compliance, or approval tied to binding commitments from PTCL. Until then, consummation of the deal remains prohibited under Section 11(11) of the Competition Act.
The CCP’s warning was blunt: PTCL cannot be allowed to dictate terms to regulators. Without accountability and strict safeguards, Pakistan’s telecom sector could fall deeper under the control of a company already marred by dominance, collusion, and defiance.
