Telecommunications in Oman – Access and Interconnection

The mandatory provision of interconnection and, in certain cases, access is a common requirement in regulated telecommunication markets internationally. In April 2016, the Telecommunications Regulatory Authority of the Sultanate of Oman (“TRA”) issued the Access and Interconnection Regulation (the “Regulation”). This comprehensive Regulation is expected to open the Omani market to additional telecommunication licensees and/or re-sellers on the basis that its main purpose is stated to be the development of investments in the telecom sector and the creation of sustainable competition within the sector.

Under the Regulation, all telecommunication companies providing their services to the public in the Sultanate have an obligation to provide interconnection and access to certain physical infrastructure and other facilities to requesting parties and wholesale customers. Access and interconnection must be provided on an equal and non-discriminatory basis.

Article 1.13 of the Telecom Act (Royal Decree (“RD”) 30/2002) defines Interconnection as a combination of technical, regulatory and financial criteria that permit the connection of two or more public telecommunications networks within the Sultanate to transport the telecommunications traffic from one telecommunication network to another network, and that permit beneficiaries to communicate freely among themselves regardless of the network they are connected to or belong to or the services they are using.

Article 1.12 (Repeated 3) of the Telecom Act defines Access Services as access of a licensee to other licenced networks with the intention of being able to provide telecommunication services including the connection of telecommunication equipment using wire line or radio means and access to any infrastructure including buildings, towers and ducts for wireline and cables.

The Regulation differentiates between the obligations of dominant and non-dominant operators, subjecting dominant operators to more stringent requirements. Non-dominant operators are obliged to negotiate and provide unregulated Access & Interconnection Services (“A&I Services”) and the main duties in this respect are good faith and fair price. Dominant operators, identified on the basis of the Decision regarding Market Definition, Dominant Licensee and Remedies (Decision 74/2013), are obliged to negotiate regulated A&I Services subject to a number of “automatic obligations,” the main services as defined in Decision 74/2013, to be provided under a Reference Access and Interconnection Offer (“RAIO”).

A dominant operator providing regulated A&I Services subject to a RAIO obligation must develop a RAIO that complies with the requirements of the Regulation, setting out the structure and minimum content of the RAIO. Such RAIO must be utilised as template for the A&I agreements in respect of regulated A&I Services and must be developed and approved by the TRA in accordance with the Regulation, which sets out a detailed process, meant to lead to a swift and efficient implementation of the system. Hefty fines are provided for if the operators do not comply with the timelines and the actions required in this respect.

The dominant operator will have to submit to the TRA a first draft RAIO within 30 days from the date of the Regulation and such draft must include proposed charges and associated documentation demonstrating the operator’s compliance with the pricing related requirements set out in the Regulation.

The TRA will review the first draft RAIO and determine its adequacy with reference to the minimum scope, content and format requirements. If the TRA deems that the RAIO fails to meet the requirements, the dominant operator must amend it within a specified timeframe. The dominant operator has an obligation to publish the RAIO “in a prominent place on its website” and any party may submit comments and observations, which will be reviewed by the TRA.

Once a dominant operator submits a draft RAIO, the TRA may also provide comments and require clarifications and request further amendments. At the end of this process, the approved RAIO must be published on the operator’s website.

This process allows a stringent review by the TRA to guarantee that RAIOs comply with the Regulation and introduces a public consultation process which should allow that the interests of non-dominant operators and other interested third parties are taken into account. This element of public consultation, interestingly, has been a constant feature in the development of the Regulation from its initial stages. In order to consider the position of interested parties and of the general public, in April 2014, the TRA issued a Public Consultation Document on a Draft Access and Interconnection Regulation, the main topic of which were the scope of obligations to be imposed on all public telecommunications licensees to provide A&I Services, the scope of the additional obligations to be imposed on dominant operators and the minimum scope and content of RAIOs. The TRA invited comments from stakeholders, interested parties and the public in general on the draft Regulation and noted that it would consider such comments when preparing a final draft of the same. The Consultation proved rather successful and its results were published in a Position Paper dated March 2015, which provided a basis for the Regulation.

On the dispute resolution front, the Regulation creates an ad hoc mechanism whereby disputes arising between parties to an A&I agreement must be resolved by mediation and, if mediation fails, by the TRA pursuant to the provisions of the Dispute Resolution Regulation, based on a request of either party.

Finally, the Regulation provides for strict penalties for non-compliance that range from OMR 10,000 to OMR 100,000 for each instance of non-compliance by non-dominant or dominant operators, with (a) an additional fine of OMR 1,000 or more per day for each day the violation continues and (b) double penalties in the event that the violation is repeated.

With a continuing element of public consultation, tight deadlines to implement the process and hefty fines for non-compliance with its provisions, the Regulation appears to be potentially a very efficient instrument for the restructuring of the telecom market in Oman.