1st REGULATORY MEETING FOR THE ARAB REGION. INTERCONNECTION: THE MOROCCAN EXPERIENCE. M. ELKADIRI, Technical Director ANRT [email protected] Algiers 19-21 April 2003. WHY INTERCONNECTION?. Interconnection is one of the main issues of the liberalization process :.
1st REGULATORY MEETING FOR THE ARAB REGION
INTERCONNECTION:THE MOROCCAN EXPERIENCE
M. ELKADIRI, Technical Director ANRT
Algiers 19-21 April 2003
Interconnection is one of the main issues of the liberalization process :
The access of a new entrant to the market is conditioned by the current interconnection policy.
Interconnection tariffs are the “Hard-core” of competition
*In Europe, long distance network often considered as part of core network
**Point of Interconnection
Source:Team analysis Mckinsey
INTERCONNECTION IS ONE OF REGULATORY LEVERSAND CANNOT BE CONSIDERED IN ISOLATION
Example regulatory levers
MOROCCAN REGULATORY FRAMEWORK OF INTERCONNECTION
Respect of principles and rules of interconnection.
Produce all necessary information to the regulator.
Operators with market share more than 20% of a telecommunications service must submit an interconnection offer to the regulator for approval. They have to inform the regulator of the modifications concerning the RIO.
THE ROLE OF ANRT
Ensure clear terms, conditions and fair prices
Make sure that the interconnect agreement is in
accordance with interconnection decree
and approve the interconnection offer
Impose sanctions and penalties for violation of regulation
Play a role of arbitrator in the interconnect dispute
LEGAL FRAMEWORK: Dispute resolution
REFERALL TO THE ANRT
of the dispute file made
the Director of the
No conclusion of the
Decision of the
Resolution of interconnection Dispute
The first interconnection dispute that the ANRT had to arbitrate was over termination tariffs :
1- The dispute: Disagreement between IAM (the incumbent) & Medi Telecom (the new entrant) about interconnection Tariffs.
2- The dispute inquiry :
ANRT entrust the inquiry to an internal Interconnection comity, which was supported by international experts.
3- The inquiry process :
- Audition of both parties.
- Analysis of the interconnection cost models of both parties
4- The decision of the administrative comity of the ANRT :
With reference to the commission inquiry report, the administrative commission of the ANRT decided that Interconnection tariffs proposed by the interconnection commission are applicable.
IAM proposal 41,5%
MédiTél proposal 20%
IAM proposal 61%
MédiTél proposal 80%
Approval of interconnect offer
The principal difficulty : INFORMATION ASYMMETRY
MOROCCAN COST ALLOCATION MODEL
- MCAM is based on historic costs.
MOROCCAN COST ALLOCATION MODEL
There are many issues related to interconnection to be faced:
The LRIC (Long run Incremental cost) method will allow the regulator to assess the operators efficiency through the orientation of their interconnection tariffs toward costs.
Introduce adaptation to the legal framework of interconnection in order to take into account the specification related to advanced services like UMTS, IP telephony, GPRS etc…
“healthy” interconnection process :
Independent team with wide ranging expertise
Good calculation tools
Good benchmark knowledge
For sure, your decision will be challenged