The Competition Commission of Pakistan has approved Pakistan Telecommunication Company Limited’s acquisition of Telenor Pakistan and Orion Towers shareholdings, subject to strict conditions designed to maintain fair competition and protect consumer interests. The approval, announced at a press conference held at the CCP headquarters, marks a major development in the telecom sector as it paves the way for the merger of Telenor and Ufone, a PTCL subsidiary.
According to the commission, a comprehensive review of the merger transaction was conducted, analyzing market structure, concentration levels, efficiencies, and potential risks to competition. CCP Chairman Dr Kabir Ahmed Sidhu, along with Registrar and Head of Legal Ambreen Abbasi and members Salman Amin and Shahzad Hussain, outlined the findings. Dr Sidhu emphasized that the decision ensures a level playing field for all operators while also safeguarding consumer welfare. He noted that the merger is expected to improve service quality, expand product offerings, and accelerate technological advancements including the rollout of 5G. Abbasi added that the approval was conditional, with safeguards specifically designed to prevent anti-competitive behavior.
The CCP detailed several requirements to ensure compliance. PTCL and the merged entity must operate under separate boards and independent management structures, with leadership vetted under strict competency and integrity standards, overseen by Etisalat. An independent third-party will monitor compliance, audit transactions, and submit quarterly reports to CCP for five years. Provisions have been made to prevent cross-subsidisation and ensure that all related-party transactions are carried out at arm’s length. In addition, non-discriminatory access must be granted to capacity and infrastructure for all operators, while PTCL and the merged entity are required to submit all Reference Interconnect Offers to PTA for approval. Wholesale pricing for IP bandwidth, domestic leased lines, LDI, and infrastructure services must also receive PTA clearance to avoid predatory pricing.
Further, PTCL and Telenor must demonstrate that efficiencies gained from the merger are passed on to consumers through improved pricing, services, and infrastructure investments. Service quality benchmarks, tariff approvals, and innovation policies remain mandatory, with CCP reserving the right to direct divestiture of assets or business segments in case of violations. Amin stated that these safeguards are particularly aimed at preventing favoritism, predatory practices, and barriers to market entry while ensuring effective regulatory oversight by CCP and PTA.
The approval comes after CCP previously raised concerns about PTCL’s delay in providing critical information required for merger evaluation. The watchdog had warned against risks of cross-subsidisation between PTCL and Ufone, both operating under joint management. With this conditional approval, the commission aims to strike a balance between enabling market growth and ensuring transparency in Pakistan’s telecom sector, which continues to evolve under increasing regulatory scrutiny.
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