The Uganda Communications Commission (UCC) confirmed new directives aimed at limiting the tariff wars among mobile operators. Under the directive issued 10 June and reported by the Daily Monitor, operators will not be allowed to charge on-net rates lower than 70 percent of interconnection rates. These currently stand at UGX 131 per minute, so no operator will be allowed to offer on-net calls below UGX 91 per minute, which translates into not less than UGX 2 per second.
Currently, some companies offer rates cheaper than UGX 2 per second, largely on a promotional basis. The new guidelines also stipulate that a promotional tariff shall not be in the market for more than 90 consecutive calendar days and may only be re-introduced after another 90 calendar days from the end of the previous promotional tariff offer. Failure to comply with the regulations could result in penalties of up to 10 percent of annual turnover. The UCC said the decision was reached following a consultation process involving industry stakeholders, and the guidelines will be effective as soon as they are gazetted. Some operators told the Daily Monitor that the decision and timing of the announcement was suspect. Others said the new regulations are an affront on legitimate business competition. The new law will also require telecom operators to notify UCC in an application five days before introducing a new calling rate.