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Anti-trust probe on China Telecom

  • Published 17 Nov 2011

The Chinese government is investigating China Telecom (0728:HKG) and China Unicom (0762:HKG), the nation’s two state-controlled fixed-line carriers for alleged monopoly violations, National Development and Reform Commission (NDRC) said. The agency claimed the two carriers were abusing their dominance in the market to prohibit competitors from entering the broadband internet business by overcharging rivals for leasing their networks. The two carriers could face fines of 1% to 10% of their annual broadband revenues if found guilty. The probe marked the first case against state-owned enterprises (SOE) under the anti-monopoly law.

Gao Hongbing, a telecom policy advisor to the government, commented that monopolistic and even oligopolistic activities in regional markets are obvious. “The telecom market is closed to competitors and monopolies harm consumers’ rights. Regulators should force dominant companies to share a part of resources with small rivals and guarantee fair competition.”

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