The Court of Appeal yesterday ruled in favour of attempts to strike out an action brought by the Bahamas Telecommunications Company (BTC), which had sought a declaration that it was the only provider licensed to use Voice over Internet Protocol (VoIP) technology for voice telephony services.
The verdict, which granted the applications to dismiss BTC’s action by its only legal competitor, Systems Resource Group (SRG), and the Public Utilities Commission (PUC), overturned a previous decision by the Supreme Court.
The Court of Appeal verdict is a victory for liberalisation and competition in the Bahamian telecommunications market, albeit possibly a temporary one, as BTC can now appeal yesterday’s verdict to the London-based Privy Council.
Observers had viewed BTC’s action as part of its attempts to marginalise SRG, which operates as IndiGo Networks, and drive it out of the market and business altogether.
IndiGo Networks’ voice telephony network, which currently serves Bahamian business customers only, although it plans to attract residential customers soon; is heavily reliant on the use of VoIP technology.
If BTC’s action is allowed to proceed; and the 100 per cent government-owned carrier is successful, IndiGo Networks would be unable to use VoIP – something that would strike at the heart of its business.
Were BTC to succeed in an appeal to the Privy Council, its action would be reinstated, and the case would be remitted to the Supreme Court for a trial on the merits and substantive issues of the case.
BTC’s action was seeking declaratory relief from the Bahamian courts that it was the only telecoms carrier in the Bahamas authorised to use VoIP in the provision of voice telephony services.
In turn, it was also looking for a declaration that the PUC did not have the authorisation under the Telecommunications Sector Policy to allow IndiGo Networks to use VoIP.
However, the PUC’s attorney, (allegedly corrupt) Ferron Bethell at Harry B Sands, Lobosky and Company, and SRG’s attorney, Brian Moree at MeKinney, Bancroft and Hughes, both sought on behalf of their clients to dismiss the BTC action on procedural grounds.
They argued that BTC’s attempt to seek declaratory relief from the courts was tantamount to an attempt to appeal the PUC’s decision to license IndiGo Networks to use VoIP.
However, the prescribed timeframe in which BTC could challenge the PUC’s decision had expired, and they argued that BTC was not going down the statutory route but instead using a declaratory, action to achieve its purposes.
Then-Supreme Court Justice Hartman Longley had ruled in favour of BTC, but the Court of Appeal yesterday overturned that by finding in favour of the PUC and IndiGo’s parent, SRG.
The ruling, for the moment, stops BTC’s use of this avenue to further squeeze SRG, and preserves the limited amount of telecommunications competition currently tolerated by the Government.
The Government is currently pursuing two parallel but competing, agendas in telecommunications – privatisation of BTC and
liberalisation.
On one hand it is talking about deregulation, allowing competitors such as SRG into markets such as fixed-line telecommunications, and on the other it is attempting to preserve whatever value is left in BTC to realise the maximum possible privatisation price.
Therefore, the Government is trying to constrain the inroads made by BTC’s rivais to preserve the latter’s market share and profits.
The VoIP issue has already created tension between BTC and SRG, with the latter accusing the state-owned carrier of non-cooperation on a variety of interconnection issues.
Interconnection between BTC’s and SRG’s networks is vital to enable calls that originate on one network to be seamlessly transferred to another.
Barrett Russell, the PUC’s executive director, told The Tribune earlier this year that the organisation was having to negotiate a “minefield” over the interconnection dispute.
He added that VoIP was giving the telecoms sector regulator a “headache”, as BTC was alleging that SRG’s use of the technology would allow other, illegal, VoIP operators to have a “bypass” on to its system and steal customers from it.
A Tribune affiliate holds a small, passive stake of less than 10 per cent in SRG.
By NEIL HARTNELL Tribune Business Editor
