Busia Senator Okiya Omtatah has sued ICT Cabinet Secretary Eliud Owalo and Communications Authority of Kenya (CA) over their decision to increase seven times the charges levied on mobile termination rates.

In a petition lodged at the Milimani High Court, Omtatah wants the court to quash the new call termination charges imposed by the government of Sh0.41, and order the CA to impose the scientifically determined rate of Sh0.06.

He argues that the CS impugned MTR of Sh0.41 recently introduced by the state is void for contravening clear provisions of the Constitution and the law.

The Senator who has sued the Minister, CA and the Attorney-General Justin Muturi says he is extremely aggrieved by their move to set as March 1, the Mobile Termination Rate (MTR) for calls per minute at an arbitrary Sh0.41 per minute instead of the much lower scientifically derived MTR of Sh0.06 per minute, which was recommended by the network cost study the Authority commissioned to determine interconnect charges.

“This application and the petition are extremely urgent because on March 1, 2024, the Communication Authority of Kenya (CA) unilaterally imposed the new Mobile Termination Rate (MTR) of Sh0.41 per minute. Though it reduced the MTR from Sh0.58 per minute, it is seven times more than the Sh0.06 recommended by the consultants the Authority hired to conduct a network cost study two years ago,” Omtatah says.

Cost of interconnection

He contends that the new rates of ShO.41 are very high since the same does not reflect the true cost of interconnection in Kenya, and it hinders service providers from offering consumers more affordable and competitive prices.

“It is unacceptable that Kenya should have such high rates when other East African countries have much lower ratings, and Rwanda has a zero rated MTR,” Omtatah states.

The Senator says the network cost study was commissioned to comply with an order made by the Communication and Multimedia Appeals Tribunal on August 4, 2022, to settle a case which Safaricom Limited had filed to challenge the CA’s decision made on December 23, 2021, to reduce the MTR from Sh0.99 per minute to Sh0.12 per minute.

Omtatah wants Safaricom, the CA and other parties to the case before the tribunal settled the dispute by agreeing on an interim basis that the MTR be raised from Sh0.12 to Sh0.58 MTR per minute for 12 months from August 1, 2022, pending conclusion of a Network Cost Study.

The court papers show that not only did the CA arbitrarily extend the twelve months period past August 1, 2023 to March 1, 2024 but it has arbitrarily imposed rate of Sh0.41, which is seven  times higher than the rate of Sh0.06 which was scientifically determined by the Network Cost Study.

“The petitioner is aggrieved that instead of implementing the recommended MTR of Ksh 0.06 per minute, the CA unilaterally and irregularly extended the application of the interim MTR of Ksh 0.58 per minute to last from August 31 2023 to September 15 2023 and again further to November 15, 2023,” the reads the petition.

Disregarded study

Omtatah says that in arriving at the MTR of Sh0.41 per minute, the CA disregarded the cost study undertaken by their own consultants and, in setting the rate to run for a period of 2 years, it fails to demonstrate a plan to move the rate towards the scientifically derived MTR of Sh0.06 per minute.

“The cost study that set the MTR at Ksh 0.06 per minute went through public participation as required by law. But in setting the MTR of Sh0.41 per minute the CA did not undertake any consultations with the stakeholders nor the public. Hence, the CA disregarded public interest,” He adds

Further, the senator argues that by disregarding the recommendations of the cost study, the CA failed to account for the public funds used to fund the study, and this determination goes against prudent management of public funds.

According to Omtatah, it is a matter of public knowledge that the cost of making phone calls in Kenya is inflated by the high mobile termination rates (MTR) charged by telephony service providers for facilitating calls across rival networks.

“The lower termination rates, which should lead to lower calling rates will benefit subscribers already grappling with reduced spending power due to the adverse effects of inflation and a raft of new taxes,” he says.

The senator has sued the CA for disregarding the orders and decree issued in the Communication and Multimedia Appeals Tribunal Appeal No. E003 of 2021 as regards the setting of the Mobile Termination Rate (MTR) for local service providers.

He has also sued the Authority for allowing local mobile phone operators to exploit their subscribers by setting the MTR at Sh0.41 per minute, which is  seven times more than the Sh0.06 recommended by the consultants the Authority hired to conduct a network cost study.

Omtatah avers that CA is bound by the Constitution and other laws of Kenya, and has no capacity to act beyond or outside the law and must uphold the provisions and the spirit of the Constitution, and statutes.

“ It is therefore  extremely urgent that the Court intervenes to protect the Kenyan public, which relies heavily on mobile telephone for social and economic undertakings, from exploitation from the CA,” Omtatah seeks.

Mobile and Fixed Termination Rates (MTRs/FTRs) are charges that are paid between Mobile and Fixed Network Operators (MNOs/FNO) whenever they exchange traffic.

The charges are levied by one telephone service provider on other providers for terminating their calls on its network.

Justice Chacha Mwita has ordered the ICT, CA and the IG to file their responses before June, 2024 when the matter will be mentioned for further directions.