Legal fight looms over Iraq's $20m mobile fines

Iraq's Ministry of Communications may have to take the country's mobile operators to court if it wants to extract just over US$20 million worth of fines it has imposed on the telecom companies for providing what it describes as a "bad service".

Last week government spokesman Ali Al-Dabbagh is reported to have said in a statement that the fines were the result of "the bad service provided by these companies" and that the operators "should respect the contracts and the conditions laid down by the government".

Zain was fined $18 million, while Asiacell and Korek were both fined just over $1 million each. Neither Zain or Asiacell have received official confirmation of the fines.
Asiacell's marketing manager, Mohammed Serieh has questioned the ministry's right to issue the fines.

He told CommsMEA: "As a mobile operator the contractual relationship between us and the Iraqi government is with the regulator. The ministry of telecommunications has no power whatsoever under mobile telecommunications.

"We'll wait until we receive official notice about the fines and then we will take it from there," he said

Both operators contend that jamming devices used by security services to prevent the detonation of roadside bombs and improvised explosive devices are to blame for outages and poor network quality.

It is the second time that the operators have been fined by the ministry for the standard of their network coverage. Earlier this year, Zain Iraq was ordered to pay $9 million, while Asiacell was hit with a $300,000 fine.

Zain Iraq CEO Ali Al Dahwi said Zain paid that sum of money in order to draw a line under the affair, and "as a gift to the Iraqi people". But he appears reluctant to part with any of Zain's money this time around.

When asked if he would pay the latest fine, he replied: "Let the law be the judge. What we are doing is going to keep and honour all of the legal rights we have in Iraq under the licence and let the law be the judge.”

Both operators have also questioned the way the fines were calculated. According to Serieh, operators were fined according to the percentage of complaints made by customers who called a free phone number.
"They took some sort of a weird formula of this," Al Dawhi said. "Basically, [this method] is not accepted in the world, it is heresay. The terms of the mobile licence talks about engineering and scientific formula, and a drive test to be used to determine whether there is to be a penalty or not.

"There are accepted ways and norms in the world, and the Iraqi government did not use these norms. This is twice in a row,” he said.

Al Dahwi added that he has "no clue" as to how they arrived at the figure of $18 million, but he said that Zain is being singled out because it is "without any strong political power" in Iraq.

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