Batelco should be fined for breaching obligations, says panel

The verdict, in line with the findings of Bahrain's Telecommunication Regulation Authority (TRA), also finds the telco breached the terms of its Reference Offer, although the arbitration board chose to reduce the fine to BD750,000.

In 2009, the TRA ordered Batelco to enable other licensed companies to gain direct access to international capacity provided by Flag Telecom, which is housed in a Batelco facility, in order to boost competition in the kingdom.

Following the failure to comply with this draft order, the TRA issued a further final order in 2009 that imposed a fine upon Batelco for the breaches of its regulatory obligations now upheld by the arbitration board.

Commenting on the award, Dr. Mohammed Ahmed Al Amer, Chairman of Bahrain's TRA said: "Since its inception TRA has sought to primarily protect the best interest of consumers, telecommunications companies and investors for the development of a telecommunications market based upon fair and effective competition, promoting investment and supporting the national economy."

"A breach of the nature committed by Batelco required TRA to take enforcement action," he continued. "All the actions taken by TRA pursuant to its powers as an independent regulatory authority for the telecommunications sector in the Kingdom of Bahrain are based upon its commitment to the standards of transparency, credibility and fairness," he added.

The arbitration board's award means that the TRA's original order to Batelco has been vindicated as a result of such violations. The dispute has lingered for three years and, came to an end in favour of the Bahrain telco market, according to a statement from the TRA, enabling it to take enforcement actions to support the development of competition while providing adequate appeal mechanisms.

"This ruling will primarily serve the best interests of the Bahraini consumers and TRA believes that the parties have achieved collective progress through this arbitration," read the statement.

"The award, delivered by a team of international arbitrators and highly experienced experts, is the first of its kind in the history of arbitration in the Kingdom of Bahrain that is delivered in such disputes and especially in the telecommunications sector. It is a credit to the achievements of the Kingdom of Bahrain in creating a free and liberal climate that promotes competitiveness," it said.