CyTA Accused Of Hindering Telecoms Liberalisation

by Lorys Charalambous, Tax-News.com, Nicosia

02 August 2002

Cyprus monopoly telecoms operator, Cyprus Telecommunications Agency (CyTA), has been exposed in an attempt to rig the international connections market against local ISPs who are competitive with its own Cytanet Internet division.

According to a report in the Financial Mirror, CyTA has demanded that all international partners of the island's ISPs, all of whom have to use CyTA's monopoly international link, known as CyTAInternet.Link, sign agreements that they will not use their capacity on the Link for anything but the ISPs' Internet traffic, effectively preventing them from marketing data or IP services in competition with CyTA.

In addition, say the ISPs, CyTA is threatening to increase the prices that they pay for the Link, when according to the ISPs it is already too high. Currently an ISP has to pay CyTA US$3-6,000 for 2Mbps capacity, which the ISPs say they could source internationally for as little as $1,000 - yet CyTA means to increase the price to $8-17,000.

If this were just a spat between telecoms operators perhaps it wouldn't matter, but the result is that businesses and individuals, who already pay several times ruling international rates for their Internet services in Cyprus, will end up paying still more. And this in a country which constantly harps on about becoming a regional electronic powerhouse!

Despite endless laws and Cabinet decisions aimed at deregulating Cyprus's telecommunications market, a process that is supposed to be complete by 2003, the reality remains that CyTA continues to behave as an old-style PTT state monopoly, and no-one seems to be able (or wants) to stop it.

The newly-appointed telecoms regulator, Vassos Pyrgos, is fully aware of such issues, and indeed he has been given wide powers by Parliament which he could use to force deregulation onto CyTA - but he has no staff and seemingly no practical possibility of enforcing any pronouncement he might make.

According to the Financial Mirror, the best hope is that the EU will make adverse comments about the situation. But the EU official in charge of policing promised liberalisation commitments among the candidate countries told the paper that he could do nothing until his report in all candidate countries is published (hopefully!) in November.

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