Vodafone clarifies ICTQatar ruling on the introduction of Virgin Mobile in Qatar

25 July, 2010: ictQATAR has issued its decision relating to Vodafone Qatar's complaint against Qtel's introduction of Virgin Mobile Qatar.  Vodafone Qatar has since received several questions about the contents of this decision and provides this press release to further explain the terms of ictQATAR's determination, in line with Vodafone's commitment to being honest and transparent.

ictQATAR's decision which has now been published on their website, http://www.ict.gov.qa/output/Page2000.asp, can be summarised as follows:

1.       Contrary to claims made by Vodafone Qatar, ictQATAR held that Virgin Mobile Qatar is not a separate mobile services provider or a Mobile Virtual Network Operator (MVNO) - rather it is operating under a brand partnership agreement with Qtel.   Because of this, the Virgin Mobile services do not need a separate telecommunications license to operate in Qatar.

2.       Despite the above, ictQATAR found that the way that Qtel launched the Virgin Mobile services in Qatar on 13 May 2010, and the continuing provision of Virgin Mobile services to the public breached the law by implying that "Virgin Mobile Qatar" was a separate mobile provider in Qatar.  In ictQATAR's view, "[t]he potential for confusion was, and remains, high".

3.       ictQATAR ruled that Qtel's actions in launching Virgin Mobile constituted clear breaches of:

a.       Article 90 of the Executive By-Law, which prohibits misleading conduct;

b.       Article 41 of the Telecommunications Law and Article 75 of the Executive By-Law which prohibit anti-competitive conduct and abuse of dominance; and

c.       Article 51 of the Telecommunications Law which prohibits unfair dealing.

4.       ictQATAR has ruled that Qtel must pay a penalty to the State of Qatar for its unlawful actions and has referred the case to the Office of the Attorney General for assessment of the appropriate fine.

5.       Vodafone Qatar also alleged that Qtel's actions breached several provisions of the Commercial Law.   ictQATAR held that it could not rule on these claims, as they fell outside of ictQATAR's jurisdiction but has referred the claims to the Office of the Attorney General.

6.       In addition to finding that Qtel's actions were illegal, ictQATAR also issued new orders relating to how the Virgin Mobile services are delivered by Qtel.  Since the launch of Virgin Mobile, ictQATAR has twice already required Qtel to make changes to the Virgin Mobile services in order to undermine the misleading nature in which these services were launched.  ictQATAR's determination requires yet more changes to be made, stating that such changes are needed to "correct the inaccurate public perception of "Virgin Mobile Qatar" caused by [Qtel's] deceptive marketing efforts, penalize Qtel for its unlawful actions and prevent similar misleading tactics from being utilized in this future".

7.       The new orders, issued by ictQATAR on 15 July 2010, require Qtel to:

a.       to change the web address of Qtel's Virgin Mobile services to include Qtel (e.g. www.qtelvirginmobile.com.qa) and cross-link that page to Qtel's website so that those users who navigate to Virgin Mobile's website in the Qatar country domain will be aware immediately that they are being directed to a website for a service provided by Qtel over Qtel's wireless network.  Additionally, the renamed webpage should be cross-linked to Qtel's main homepage.

b.        take the necessary steps to enable Qtel-Virgin Mobile customers to be able to contact Qtel customer service directly and in the first instance.  Qtel Virgin Mobile customers must be able to have inquiries, requests or complaints answered by calling the general Qtel customer service support centre for assistance or by visiting a Qtel customer service centre.  ictQATAR specified that those customers should not be directed to a separate number or call centre dedicated to "Qtel Virgin Mobile" services only.  Qtel is ordered to provide reciprocal call transfer capacities between the general Qtel customer service support centre for assistance with their Qtel Virgin Mobile service and to provide reciprocal call transfer capabilities between the general Qtel customer care hotline and the hotline previously dedicated to serving only customers subscribed to Qtel's Virgin Mobile service.

c.       Ensure that Qtel retail outlets offer Qtel Virgin Mobile branded products and services.  Qtel Virgin Mobile branded outlets, including those within the Virgin Megastores, must also offer other Qtel products and services.  This applies to all retail locations selling Qtel services, including Qtel Virgin Mobile services.  A customer seeking telecommunications services or information about those services must have the opportunity to receive information on or subscribe to any Qtel service at any of those retail outlets.

d.       cease and desist from all actions or activities in violation of the Telecommunications Law, By-Law and these Orders. 

8.       In its complaint, Vodafone Qatar had also made claims against ictQATAR relating to its handling of the current complaint claiming that it had not conducted a transparent process and had failed to consult with Vodafone at key stages in the procedure.  In its determination, ictQATAR found that its processes were compliant with the law and that it had conducted the proceedings "in a manner that is transparent, fair, and consistent with due process and international best practices".

9.       The new Orders place Qtel on notice that repeated offences will result in the maximum penalties available under the Telecommunications Law and/or other relevant Qatari Laws and may result in ictQATAR revoking or suspending Qtel's telecommunications license.

Vodafone Qatar again reaffirms its support of ictQATAR's new dispute resolution process, which is critical to strengthen the regulatory regime in Qatar, ensure the law is adhered to and to achieve ictQATAR's stated objectives to "foster an efficient telecommunications sector to benefit society, reform and provide a sustainable business environment".

Vodafone Qatar is currently reviewing ictQATAR's determination and considering its options for further legal recourse in relation to this matter.



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