Tuesday, July 13, 2010

Ministerial Decision Clarifies Telecommunications Dispute Procedures

For telecommunications companies that have grappled with uncertainty over the handling of disputes between licensees, a recent Ministerial Decision provides some welcome clarity. Ministerial Decision No. 44/2010, issued by the Omani Telecommunications Regulatory Authority (“TRA”), has set out clearly the procedures for the resolution of such disputes, as well as the process whereby Licensees can appeal TRA decisions.

Preliminary Settlement Attempt Required
Prior to filing any case, a petitioning licensee must serve a notice on the other licensee. Within 14 days of this notice, senior executives of the respective licensees are required to meet and attempt to reach a settlement.

If a settlement cannot be agreed, the matter must be escalated to the respective chairmen of the two licensees within 20 days of the original notice, and the two chairmen must attempt to reach a settlement within 30 days of the original notice (although the chairmen may agree to extend the settlement period).

Minutes must be recorded for all meetings, but non-compliance by one licensee will not delay any of the procedures.

TRA Disputes Hearings: Key Features
If the settlement attempts described above have taken place and have failed to resolve the dispute, the petitioning licensee may file a claim with the TRA. Within 15 days of this filing, the TRA will perform preliminary scrutiny of the case and decide whether, prima facie, the dispute falls within the TRA's purview. If the TRA deems that it does, it will constitute a panel to hear the dispute.

Perhaps the most important thing for companies to understand from the outset about the TRA dispute hearing process is that Ministerial Decision No. 44/2010 grants these panels very extensive powers, such as the discretion to: (i) introduce additional parties to the dispute; (ii) appoint an expert to provide an opinion; (iii) require any party to take measures or refrain from any action until the end of the dispute; or (iv) issue orders for interim or precautionary measures.

Another noteworthy feature of TRA dispute resolution hearings is that the proceedings are required to take place in Arabic, although the chairman of the panel may at his discretion approve the use of a foreign language for all or part of the proceedings. Regardless of the languages used in the proceedings, the final decision will be rendered in Arabic (although if some of the proceedings have taken place in another language, there may be limited use of that foreign language in the decision).

Panel Proceedings
Once the TRA has constituted a panel to hear the dispute, the chairman of the panel will provide the defendant licensee with a copy of the petitioner licensee’s statement of claim, together with any decision the chairman has made concerning the language of the proceedings. The chairman shall grant the defendant licensee a period of at least 15 days to file a reply, and once the chairman receives this reply he shall provide a copy of it to the petitioner licensee.

If either party requests a quasi-court hearing based on grounds deemed acceptable by the panel, then the panel must convene such a hearing, and the chairman of the panel will be responsible for the conduct of the hearing. The panel may also convene a quasi-court hearing on its own initiative, if it deems this necessary.

When the panel has concluded its deliberations, the parties will be notified that the matter is reserved for a decision, which will be rendered within two weeks of such notice. This notice marks the cut-off point beyond which neither party may submit any further documentation. The panel’s decision will be given in writing and signed by the chairman.

Appealing the Panel’s Decision
Either party may appeal the panel’s decision by filing an appeal with the TRA within 30 days of being notified of the decision.

Although the filing of an appeal does not automatically suspend the enforcement of the decision, enforcement may be suspended if deemed necessary by the TRA. Within 30 days of the appeal being filed, the TRA will issue a judgment to (i) uphold the decision, (ii) amend/revoke the decision or (iii) refer the dispute, or any part of it, back to the original panel, or to another panel, for resolution. Article 35(4) of Ministerial Decision No. 44/2010 states that the ultimate judgment on the appeal will be final and binding.

In summary, this new Ministerial Decision promulgated by the TRA provides a helpful measure of clarity for understanding the dispute process for the telecommunications sector, yet it also prescribes a very lengthy and detailed set of rules to which the parties must adhere. We therefore suggest that companies consult legal advisors as early as possible in the process when a dispute arises.