HomeTopicsBusinessCosta Rican Electricity Institute appeals ₡2 billion fine by regulators

Costa Rican Electricity Institute appeals ₡2 billion fine by regulators

The Costa Rican Electricity Institute (ICE) is challenging a ₡2.2 billion ($4 million) fine levied by the Telecommunications Superintendency (SUTEL) for unfair competition involving discounted offers for ICE phone service.

SUTEL sanctioned ICE alleging the carrier carried out anti-competitive practices in 2011 and 2012 that affected its new competitors Movistar and Claro. The investigation was prompted by a complaint filed by Spanish telecom Telefónica, which operates in Costa Rica as the brand Movistar.

The regulatory agency alleges that ICE’s unfair practices consisted of rate discounts offered under a promotion called “Chip Extremo” aimed at attracting prepaid mobile phone users. The promotion was conducted twice in two years, first from November to December 2011, and then from October to November 2012.

ICE’s appeal calls the SUTEL action illegal, inconsistent and flawed due to a “lack of proof and evidence to justify the sanction.” It also argues that ICE’s promotions did not cause any of its competitors to exit the market or block entry to new competitors.

On Wednesday, ICE Telecommunications Manager Jaime Palermo said “SUTEL itself has recognized that the mobile telecommunications’ market is vulnerable to competitive practices from all carriers, as all of them sell below operating costs.” He added that, “even Telefónica has reached the same conclusion.”

The appeal also states that Telefónica filed the complaint with SUTEL only 15 days after launching operations in Costa Rica as a measure to prevent ICE from conducting its promotions.

“During the investigated period this carrier managed to increase its market share and even conducted more aggressive promotions than those from ICE, and yet only ICE was sanctioned,” Palermo said in a public statement.

SUTEL’s council will analyze ICE’s appeal, and in the case that the resolution does not favor the state-owned company, ICE has the right to proceed with a challenge in court.

The regulatory agency last month announced that in coming weeks it will conduct a study to determine which markets have the apropriate conditions to be open for competition. Such a resolution would mean that each carrier would be free to set rates.

ICE, under its brand name kölbi, leads Costa Rica’s mobile market with a 72 percent share, followed by Mexican carrier Claro with 13.6 percent, Movistar with 13.4 percent, and locals Tuyo Móvil and Full Móvil with less than 1 percent each.

Trending Now

Costa Rica Could Be Home to More Than 40,000 Fungal Species, Study Finds

Costa Rica is known around the world for monkeys, sloths, toucans, sea turtles and an enormous variety of plants, but one of the richest...

Costa Rica Falls Six Places in FIFA Ranking After Two Losses

Costa Rica’s national soccer team has taken another hit after a rough start to the Concacaf Nations League, dropping six places in FIFA’s live...

Margaritaville at Sea Adds Limón as Its First Costa Rica Port

Margaritaville at Sea will make Limón its first Costa Rica port of call in 2028.

Costa Rica Authorities Find Dock Inside Protected Río Tárcoles Area

Environmental authorities are preparing legal action after inspectors found a long walkway, dock and floating platform extending into a protected area along the Río...

Panama Rescues Three Costa Rican Fishermen After Six Days Adrift in the Caribbean

Three Limón fishermen missing since Sept. 21 were found alive off Panama's Caribbean coast after their boat's engine failed and a cellphone call to 911 led rescuers to them.

Costa Rica Ombudsman Condemns Justice Minister’s Prison Video

Costa Rica's ombudsman condemned a Justice Ministry video showing inmates on a prison floor. The minister says her opinion isn't binding.

Costa Rica Takes Two Top Honors in National Geographic UK Travel Awards

British travelers have placed Costa Rica at the top of two major travel categories, naming it their favorite destination for both adventure and responsible...

Costa Rica Faces Haiti at a Packed Saprissa With Bryan Ruiz’s Future Undecided

Costa Rica closes its Concacaf Nations League group stage tonight against Haiti, and a national team that went nearly a year without a win...

Costa Rica’s Capital Brings Its Forgotten Tram History Back Into View

A piece of San José’s transportation history is coming back into view, but not in the way one might expect. The Municipality of San...
L. Arias
L. Arias
Reporter | The Tico Times |
Loading…

Latest News from Costa Rica

Costa Rica Coffee Maker Chorreador
Costa Rica Car Rentals
Costa Rica Travel Insurance
Costa Rica Travel