ISLAMABAD: The Competition Commission of Pakistan (CCP) on Tuesday gave conditional approval to Pakistan Telecommunication Company Limited’s (PTCL) $400 million acquisition of Telenor Pakistan (Pvt.) Ltd. and Orion Towers (Pvt.) Ltd., clearing one of the largest mergers in Pakistan’s telecom history.
The decision, announced at a press conference at CCP headquarters, ends an 18-month-long review of the transaction, during which the regulator faced delays, incomplete disclosures, and political pressure but maintained a rigorous process.
CCP Chairman Dr. Kabir Ahmed Sidhu, flanked by Member Salman Amin, Registrar Shahzad Hussain, and Head of Legal Ambreen Abbasi, said the approval comes with stringent safeguards designed to prevent abuse of dominance, ensure fair competition, and pass efficiencies on to consumers.
“This merger is a landmark case for Pakistan. We have ensured a level playing field for all operators while safeguarding consumer interests. The conditions imposed are comprehensive, forward-looking, and aligned with global best practices,” Dr. Sidhu told reporters.
Key conditions of approval:
The CCP imposed one of the toughest conditional approval frameworks in its history, drawing from precedents in the U.S., U.K., and EU:
- Separate Management & Governance: PTCL and the merged company (Ufone–Telenor Pakistan) must have independent boards and management. No person can serve on both entities, with a three-year cooling-off period before switching roles.
- Leadership Standards: CEOs and senior management must have proven telecom/digital expertise, turnaround experience, and integrity. Performance will be benchmarked against KPIs such as network quality, efficiencies, and investment.
- Independent Third-Party Reviewer (TPR): A neutral monitor will be appointed for 5 years to audit compliance, review related-party transactions, and submit quarterly reports directly to CCP.
- Related Party Transactions & Cross-Subsidization: Prohibited unless conducted competitively and at arm’s length. Sensitive commercial data cannot be shared between PTCL and the merged entity.
- Separate Accounting: Both entities must maintain distinct financial accounts for telecom segments, verified by an independent auditor and reviewed quarterly.
- Prohibition on Price Discrimination: PTCL must seek PTA’s approval for wholesale pricing of IP bandwidth, LDI, domestic leased lines, and telecom infrastructure services. Predatory retail pricing is expressly banned.
- Interconnection & Infrastructure Sharing: PTCL and MergeCo must provide non-discriminatory interconnection access to all operators, in line with PTA-approved Reference Interconnect Offers (RIOs). Decommissioning of BTS sites requires PTA approval.
- Market Access & Innovation: MergeCo must support Mobile Virtual Network Operators (MVNOs) and demonstrate progress on 5G rollout. Tariff changes require PTA approval.
- Consumer Protection: Mandatory compliance with service quality standards, innovation commitments, and efficiencies promised in the business plan.
- Divestiture Clause: In case of violations, CCP reserves the right to order divestiture of assets or business segments.
A Game-Changer for Telecom
Once completed, the merger will create Pakistan’s second-largest operator, with Ufone–Telenor Pakistan nearly matching Jazz in market size and overtaking Zong. While this raises concentration risks, officials said the conditional framework is designed to mitigate dominance while ensuring consumer benefits through improved services, reduced duplication, and infrastructure investment.
“The safeguards are unprecedented. They directly address risks of favoritism, predatory pricing, and market foreclosure,” Member CCP Salman Amin said. “If enforced effectively, this merger can deliver efficiencies, service quality improvements, and significant cost savings.”
In Line with Global Practice
The review—one of the longest in CCP’s history—mirrors timelines of international telecom deals, such as Vodafone–Three UK (23 months) and Sprint–T-Mobile in the U.S. (22 months). Officials described the case as a litmus test for CCP’s independence, with the regulator resisting corporate and political pressure to fast-track approval.
The Commission said it will remain vigilant, with quarterly compliance monitoring by the TPR and continued oversight by CCP and PTA.
